Weekly Report: PTA (Nov.14- Nov.18)

Driven by the crude oil and stock market, PTA futures slightly increased this week. Ended by this Friday, main force contract 1201 of PTA Futures in ZCE (Zhengzhou Commodity Exchange) closed at 8196 Yuan/ton; increased 48 Yuan compared with the close price on Monday, up 0.59%.

Influenced by the weak cost and the low demand in the downstream market, the discussions of PTA price stayed around 8050-8100 Yuan/ton in domestic market. The overseas market also kept steady. Taiwan cargo stayed at 1065 dollars. Korean goods stayed at 1045 dollars.

The overall crude oil futures market was unstable this week. Wednesday, the futures price surged 3.2% at the close and reached the highest point in five months, 102.59 dollars. However, affected by the concerns of global economy, oil price fell below 100 Yuan/ton. The unsteady situation of crude oil led the petrochemical products lack of confidence, and MX, PX price showed downtrend this week. Ended by this Friday, Heterogeneous MX decreased 42 dollars/ton to 1163 dollars/ton FOB Korea in Asia. PX price decreased 35 dollars to 1388 dollars/ton FOB Korea in Asia. European PX price accumulatively decreased 35 dollars to 1310 dollars/ton FOB Rotterdam.

For the downstream market, polyester products followed the previous situations. There are few orders in the foreign trade market as well as the home trade market. Most weaving manufacturers are having high inventories. Weak consumption caused polyester products prices kept downtrend. This week, discussions of polyester bottle chips price decreased to 11000 Yuan/ton. The polyester semi-dull chips price reduced to 9900 Yuan.

To sum up, the shaking macro market and weak consumption in the downstream market greatly suppressed the PTA prices. Recently, European debt crisis spread to Italy, Spain and even to France. Consumption of polyester products was weak due to increased inventories of weaving manufacturers, low operating rate of looms and the manufacturers’ cautious attitude. Hard situations of the polyester products market will drag the PTA market down and the PTA price will keep a weak tendency in a short term.