Crude Oil, Chemical and Fiber Market Week 36 Sept 6, 2020

Please check the updated market trend of Week 36

Data this week – W36

#WTIPTAMEGPET SDBOTTLEPSF1.4DVSF1.2D
2020-9-341.373565.003910.000.630.710.761.26
2020-8-2743.043550.003765.000.630.710.741.25
Change-1.6715.00145.000.000.000.010.01
Ratio-3.88%0.42%3.85%0.61%0.55%2.00%0.83%
 POY150DFDY68DDTY150DP30RINGV30RINGV30OEV30MVS
2020-9-30.710.850.881.271.651.551.67
2020-8-270.710.860.891.251.641.551.64
Change-0.00-0.01-0.000.020.010.000.02
Ratio-0.27%-0.90%-0.44%1.55%0.55%0.08%1.41%

Market this week – W36

Summary: Oil closed down, PTA fluctuated, MEG moved up, Polyester chip rose slightly, Polyester filament yarn promoted and returned, PSF rebounded and VSF rose slightly.

1,Oil prices closed down slightly this week. Oil prices fluctuated slightly in the first half of the week; there was a sharp drop on Wednesday. Although data released by the U.S. Energy Information Administration showed that the value of changes in U.S. crude oil inventories last week fell for six consecutive weeks, the largest decline since the week of July 24, but in the Russian opposition Navaline was found to be poisoned by “Novijok” and OPEC’s key ally also increased oil production last month, resulting in lower oil prices. With the global economic recovery stagnating in many key economies and crude oil demand stabilizing at a level much lower than the level before the epidemic outbreak, oil prices continued their downward trend on Thursday. Industry analysts believe that the rebound wave of international crude oil prices has actually ended in early June. Since then, the only kinetic energy for oil prices to continue to rise slowly comes from the continued decline in the US dollar exchange rate. In the process, the oil market supply and demand fundamentals has not been further improved. Since then, the difficult transportation situation caused by the global epidemic will still suppress the demand for crude oil. At the same time, the willingness of OPEC + countries to continue to forcefully reduce production has become less and less, which means that the oil price outlook will still fall into a see-saw situation.  Only when breakthroughs are made in vaccine research and development and the end of the global epidemic is imminent, oil prices may record a breakthrough upward trend.

2,PTA futures first rose and then fell, and the spot price rose. Due to the good overall commodity atmosphere, PTA futures fluctuated and rose, and then due to the delay of the maintenance of some PTA devices in September, supply and demand maintained their accumulated expectations, suppressing the increase. At the beginning of the week, the buying was active, and the transaction volume was increased. In the second half of the week, the hurricane ended and the supply resumed, and the cost-end prices dropped slightly. The commodity atmosphere was slightly weaker. PTA futures fluctuated and fell, and the spot market showed a weak performance. During the week, the spot transaction volume performed generally. Polyester factories had weak buying momentum and often needed replenishment. In addition, basis fluctuations were limited, and the activity of traders also declined. In next week, some PTA plant such as Fuhua, Luohua, Reignwood will restart, the operating rate will rebound, polyester load will be adjusted at a high level, and supply and demand are expected to remain stable. However, as the delivery date approaches, the source of warehouse receipts has gradually flowed out. Considering factors such as quality and freight, the digestion of old goods needs to be exchanged for better price. Considering this condition, the PTA price is expected to be weak.

3,MEG rose first, then consolidated. On Monday, MEG prices went up strongly, market transactions were active, and buying momentum followed up well. The daily commodity market trend was strong, the market sentiment was obviously boosted, and the MEG port inventory dropped sharply. On Tuesday, MEG prices rose sharply, market buying followed up well, and some traders were active in restocking. On Wednesday, MEG prices fluctuated within a narrow range, and market transactions were fair. On Thursday, the MEG price range was sorted out, and market discussions were general. Affected by the typhoon last week, the MEG port was closed for shipping, and the overall ship warehousing was relatively slow. At the beginning of the week, the MEG port inventory dropped significantly. In addition, due to the impact of the US hurricane, the shutdown time of some installations has been extended, and the supply of ocean cargo is expected to be reduced. In the short term, the MEG range is mainly consolidated.

4,Polyester chips rose slightly, mainly driven by upstream raw materials. During the week, MEG rose significantly. In addition, PTA once went up, the market trading atmosphere rebounded, low-level transactions moderately increased volume, and prices gradually rose. The volume of transactions was moderately high, mainly concentrated in the first half of the week. The demand for low replenishment increased significantly, but the momentum of chasing high in the second half of the week weakened. The upstream raw materials continue to fluctuate, and the cost-end fluctuations are still limited. At present, the cash flow loss of polyester chips is expanding, and the price downside is limited, but the downstream buying momentum is also insufficient. It is expected that the short-term polyester chips will mainly fluctuate.

5,Polyester filament yarns in Jiangsu and Zhejiang returned to original price after the sales promotion at the end of the month. At the beginning of the week, the production and sales of polyester yarns will be rushed at the end of the month due to the sale promotions ; after the increase of production and sales, the polyester yarn factory discounts was canceled and prices returned; The price of polyester yarn in South China is stable. In the export market, export quotations have mostly risen, mainly due to the soaring ocean freight and rising exchange rates; recent export orders have declined slightly compared with the previous period, and the high freight rates have made orders relatively cautious. At present, ocean freight is still rising. South America has even increased 3-4 times, and it is difficult to decline in the short term. At the same time, the RMB exchange rate is also strengthening, and export prices are expected to remain firm.

6,Polyester staple fiber have been smooth this week and prices have increased. The raw material EG continued to rise, and the downstream concentrated replenishment. PSF transactions gradually improved and the discounts narrowed. In the first half of the week, the production and sales for three consecutive days were 100-300%. and then price increased. In the second half of the week, as raw materials adjusted, PSF stopped rising and stabilized, and transaction volume fell. the PSF loading rate increased to 97.9%, the highest this year. Except for some long-term idle devices, most of them run at full load. Downstream polyester staple yarns and polyester-cotton yarns have followed up, sales are relatively smooth, and inventories continue to decline.

7,Viscose staple fiber market performed quietly, with transactions moving up slightly. Due to the better execution of pre-orders, the inventory pressure of viscose staple fiber factories has gradually reduced, and the willingness to increase prices is higher; downstream replenishment operations have increased. Recently, the downstream viscose staple yarn transaction has been improved significantly, the industry inventory has dropped rapidly, the price of various type viscose yarns have moved up slightly, and the increase of vortex yarn has slowed down; but stimulated by the sharp price increase of vortex yarn and the surge in transaction volume last week, other type viscose yarns are improved significantly too, which caused the industry’s inventory to drop rapidly.

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