Market this week – W26

Summary: Oil hit new high, PTA rose, MEG rebounded, Polyester chip rose quickly, Polyester filament yarn promoted and increased, PSF rose with heavy volume, VSF stabilized weakly.


1,Oil prices fluctuated and closed up this week. Oil prices both closed up on Monday, and the US WTI and Brent crude oil futures prices both hit their highest closing prices since 2018. Although price indicators and inventory data show that demand exceeds supply, there are still people who worry that OPEC+ will increase production, and the two major crude oil futures failed to continue the gains of the previous trading day on Tuesday. Benefiting from increased vaccination and relaxation of COVID-19 epidemic restrictions and exports, US oil inventories fell by 6.3 million barrels. At the same time, there are reports that OPEC+ is considering increasing its daily oil output by 500,000 barrels, which is lower than the generally expected 1 million barrels per day, which has boosted oil prices. The two major crude oil futures edged higher on Wednesday. As demand rebounded from the slump in the epidemic, the Oil price has soared above the $75 mark, reaching its highest level in two years. However, Saudi Arabia has stated that as the market is still fragile, the group of oil-producing countries will only be cautious about restoring production when they meet next week. The two major crude oil futures continued their gains on Thursday.


2,PTA spot prices rose broadly, setting a new high since 2020. Crude oil are still strong, supply growth is slow, and the PX device declines,which also boosted the increase in the cost side. Mainstream suppliers announced a 30%-50% reduction in July contract volume supply. The market is worried about liquidity issues in the later period, and there is a general reluctance to sell. The polyester load is still supported, but with the increase in prices, the purchasing enthusiasm has weakened, which inhibited the market’s transaction atmosphere. On the whole, the cost side support is obvious, and the short-term supply of PTA is limited. Under the support of polyester load, PTA follows the cost side fluctuations.


3,MEG rebounded. On Monday, MEG prices went down, and the intention to sell on the market was strong. On Tuesday, MEG prices rose strongly, and market negotiations were fair. On Wednesday, MEG prices rose strongly, market negotiations were general, and the spot basis on the market weakened. On Thursday, MEG prices fluctuated and firmed, and overall market negotiations were deadlocked. Some coal chemical plants have been overhauled, and the coal-based operating rate has dropped to around 42%. From June to July, MEG’s overall inventory accumulation is limited, and social inventory is still accumulating slightly, and most of it is reflected in explicit inventory. However, the crude oil market has performed strongly recently, and the cost end is well supported. It is expected that the MEG market will fluctuate widely in the short term.


4,Polyester chips is rising rapidly. As crude oil continued to surge and hit new highs, polyester raw materials continued to rise, and polyester costs rose sharply, driving the polyester market’s trading atmosphere to recover significantly, and chip prices continued to rise. The short-term polyester cost end support is strong, and the current terminal demand is still weak. The downstream bargain-hunting is mainly demanded and the willingness to speculate and stockpiles is limited. The short-term polyester chip range is expected to fluctuate strongly.


5,Polyester filament yarns in Jiangsu and Zhejiang are mainly sold by promotion. The overall quotations are raised. The cost side continues to rise, but considering new capacity in July and the relative weak terminal fabric business, the polyester yarn factory promoted on Tuesday. From Wednesday to Friday, the quotation of polyester filament factories rose due to the boost from the cost side: South China polyester filament quotations rose this week, driven by costs. As for the export market, export quotations have been raised overall. Recently, export orders have continued to improve. After a period of adaptation, some foreign customers have gradually begun to accept the current high freight rates. Market inquiries have increased significantly, and orders for replenishment have been relatively good. The short-term forecast for polyester filament yarn is strong.


6,Polyester staple fiber futures rose strongly with heavy trading volume. At the beginning of the week, factory prices remained stable, and the rising futures pushed up the current low prices. The transaction gradually improved and rose slightly. In the middle of the week, futures rose sharply, the basis of the futures was appropriate, and a large number of purchases were made. Traditional traders and spinning mills also made moderate cover-ups, and prices rose rapidly. Then downstream customers gradually wait and see.


7,Viscose staple fiber remained stable and fell, with few new transactions in the market. Although the quotations of the two high-end factories are relatively high, the actual transaction is difficult, and they are mainly based on preferential negotiations for fast shipments. The quotations of the mid-range fiber segment have tentatively increased, but the actual signing prices vary. In the export market, Pakistan has a certain demand this week. Affected by the high sea freight, it is still difficult to export. The short-term VSF market is expected to have weak and stable prices.