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2018 PX-PTA supply-demand and market outlook
!!Gao Younian, Chief director of synthetic raw materials, Sinopec

2018-03-29 10:44:21
Gao Younian, Chief director of synthetic raw materials, Sinopec, presented his report of 2018 PX-PTA supply-demand and market outlook 

PX industry cycle is not booming. There are intensive plant turnaround in the second quarter, so the industry is optimistic. In the first quarter, the average price of crude oil was 67 US dollars, higher year on year. Naphtha product prices increased, but not largely. Downstream markets were influenced by feedstock market. 

For PTA, domestic supply and demand conditions are at a neutral level. There is limited new capacity in the second half of the year. From PTA supply and demand, PTA prices have reversed. Downstream markets have also seen a significant improvement. Profit began to recover substantially from last year, and the operation rate improved significantly. After destocking in 2016 and 2017, downstream inventory is low. The market is rising overall. Such a good condition may maintain. 

For PX, contrary to the PTA, PX production characteristics are different from those of the PTA. Production depends on ethylene and oil side. PX social inventory would increase, and PX prices would be around 950-1,000 US dollars for the entire year, the lowest at 900 US dollars. The entire processing cost would be high first and then low. PX inventory is high in the fourth quarter, while PTA inventory is low. However, PX inventory will decline and PTA inventory will rise in the second quarter. PX investment in Asia increases significantly. The growth in downstream demand is relatively higher than upstream investment growth. 
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