With Weakening Costs and a Simultaneous Slowdown in Supply and Demand, PTA Prices Edged Down

Regarding costs, in the international crude oil spot market, Saudi Aramco sold approximately 60 million barrels of crude oil to Asia via ship-to-ship transfers. This move boosted crude exports from the Gulf region back to a daily average of 1.0-1.5 million barrels, efficiently offsetting the export shortfall caused by harm to the pipeline at Yanbu Port; the resulting ample supply in the Asian market exerted downward pressure on spot crude prices. On the futures front, expectations of looser crude supplies intensified, and the impact of rising tanker freight rates was largely offset by the increase in supply volume, keeping crude futures prices under pressure. As of September 18, the settlement price to the November contract of U.S. WTI crude futures stood at $96.08 per barrel, while the settlement price to the November contract of Brent crude futures was $103.87 per barrel.

On the supply side, multiple PTA units that had previously undergone maintenance are restarting in quick succession, pushing the sector operating rate up to around 72%; the volume of marketable supply is gradually rising, with further increases expected to materialize. while a few units have briefly shut down to maintenance, this is unlikely to alter the overarching direction of production resumption. Consequently, the market is highly likely to shift from destocking to a phase of inventory accumulation during the latter half of September, thereby capping the possible to price upside.

Demand has fallen short of expectations to the traditional peak season, acting as the primary constraint on market performance. Operating rates in the downstream polyester sector have retreated to around 74%; producers of PET bottle chips and staple fibers are facing mounting pressure from losses, leading to increased production cuts and maintenance shutdowns. Operating rates to looms in the Jiangsu-Zhejiang region have declined against seasonal trends, and follow-through on end-market textile orders remains weak. Downstream players show clear resistance to high raw material prices and are cautious about restocking, hindering the transmission of value along the supply chain and perpetuating a negative feedback loop. The anticipated "Golden September" peak season has yet to fully materialize, and with downstream companies planning concentrated production cuts around the National Day holiday, a significant boost in demand is unlikely in the short term.

Looking ahead, analysts at SunSirs believe that while PTA prices face immediate pressure from recovering domestic supply and weak demand, they are underpinned by crude oil and PX costs, resulting in a direction of range-bound fluctuation. Key variables to monitor include: first, fluctuations in international crude oil and PX prices; and second, whether downstream textile orders see a substantial recovery—specifically, whether polyester operating rates stop falling and rebound. If peak-season demand continues to underperform expectations alongside a continued ramp-up in supply, PTA prices risk a pullback; conversely, if downstream orders surge beyond expectations, there is possible to upward price movement.