News from CCTV, Beijing, June 7 (Reporter Tang Jing) PTA is one of the important bulk organic raw materials. On the 6th, PTA futures rose 6%, once rising to 7,142 yuan/ton, hitting the daily limit and setting a new high since October 2018. What causes PTA prices to strengthen? What impact will it have on industrial production?
PTA is the English abbreviation of purified terephthalic acid, with petroleum as the top and polyester as the bottom. It is an important bulk textile raw material that can be widely used in chemical fibers, light industry, electronics, construction, etc. Each field should be said to be closely related to the daily life of the public. PTA futures is a trading product with PTA as the underlying object. It was listed on the Zhengzhou Commodity Exchange in 2006. On June 6, PTA futures once rose to 7,142 yuan/ton, hitting the daily limit and setting a new high since October 2018. As of the afternoon of the 7th, PTA closed at 7,366 yuan/ton, up 4.28%.
Dong Dandan, chief researcher of CITIC Futures Energy and Chemicals, said that the strength of PTA prices is mainly due to the following two reasons: “First, the price of crude oil, the source of the entire energy and chemical products, has made an upward breakthrough. The entire overseas country is currently in the midst of an epidemic. After the compensatory consumption period, global oil consumption is still on the rise, which provides relatively strong support for crude oil prices. When crude oil prices rise, PTA, a downstream derivative, also rises. Second point, PTA The price of PX, the direct raw material, is also relatively strong, which leads to a significant increase in the cost of PTA, and PTA passively follows the increase.”
What impact will this PTA price increase have on industrial production? Wei Zhehai, an analyst at Yongan Futures, analyzed that this may cause certain obstacles to the resumption of production of downstream textile companies. Wei Zhehai said: “Because the inventory of textile companies is relatively high this year, their cash flow situation is relatively not so good. In this process, on the one hand, the demand may not be able to keep up, and on the other hand, during the normal resumption of production , PTA is an important raw material, and the rapid rise of raw materials may lead to a relatively large discount in confidence in the future, which will have a certain impact on the recovery of the entire downstream industry.”
Dong Dandan suggested that polyester companies and textile companies downstream of the industrial chain can use PTA futures for risk management. “Even if crude oil is rising, there will be adjustments in the process. If the crude oil price adjusts and drives PTA back down, we believe that polyester companies can still use PTA futures for hedging to avoid the risk of prices rising again in the future.” Dong Dandan said.
Will PTA prices continue to rise? Wei Zhehai said that it may be difficult for crude oil prices to fall sharply in the short term. As a downstream derivative of crude oil, PTA prices will be difficult to turn downward in the short term. Wei Zhehai said: “In the absence of an obvious shift in overseas refined oil products, a sharp decline in PTA may not be seen for the time being. At present, with the return of domestic PX device supply, domestic PX factories may have some say in returning , PX prices may ease in the future, but the center of the entire price may remain at a high and volatile level, at least in the next one-month cycle.”
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