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More PTA plants to shut for maintenance under waning demand

2022-12-07 08:08:54 CCFGroup

PTA market has been under the downward pressure since November as new PX and PTA capacities are scheduled to start and more polyester plants are to cut output. Based on TA2301 and PX January paper goods, PTA margin has been compressed to very low level. In PTA spot market, the spot liquidity remained relatively tight and the monthly average spot/TA2301 was still sustained at a premium of 400yuan/mt.

Downstream polyester plants continued to cut the output, leading to a gradual supply surplus of PTA. Under the bearish outlook, PTA margin will also decline and PTA producers may start to cut output also. Besides, some PTA plants facing PX supply shortage and relatively high PX prices also plan to shut the units for maintenance such as Fuhaichuang, Billion, Ineos, OPSC and Yisheng New Materials.

Plant	Capacity	Operation
Honggang	1500	Shut on Mar 15 and restart time not confirmed
Fuhaichuang	4500	O/R at 80%, but planned to lower later
Yisheng	2000	shut on July 23
Yisheng New Materials	7200	O/R up to above 90% and plans to shut 3.6 million tons/year unit in late Dec
Yisheng Hainan	2000	O/R at 90%
Yisheng Dahua	6000	O/R at 70%
Energy Investment	1000	O/R at 80%
Hengli 2	2200	Shut on Oct 25 and restart has not confirmed
Billion	2500	O/R down to 90% in late Nov-Dec
OPSC	750	to shut for 10-day T/A on Nov 27
INEOS	1100	1.1 million tons unit planned to be shut on Nov 26 and restart in end-Dec

Jiatong Energy and Weilian Chemical's new units are both under test run and Weilian may have on-spec product in end-Nov, so the supply increment will be limited in December.

According to the output cut plans of polyester plants, PTA inventory accumulation will accelerate. If polyester polymerization rate keeps at 72~73%, PTA inventory is estimated to increase 300kt in December.

In the short term, PTA supply in Zhejiang is sufficient as many polyester plants cut the output and PTA plants mostly run stably, while in Jiangsu and Shanghai, the spot liquidity remains tight due to shutdown of Hengli and Yisheng and low turntable inventory at the terminals. After more polyester in Jiangsu cut the output and Yisheng New Materials shuts for turnaround later, the regional price spread may narrow.

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