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PX supply and demand remain tight with low plant O/R

2022-04-06 10:34:50 CCFGroup

PX-naphtha spread has been recovering losses gradually since mid-Mar. It is currently hovering in the range of $220-250/mt, reflecting relatively better profits than other products in polyester chain, though the improvement in PX-naphtha spread is partly attributed to the squeeze of naphtha to crude oil spread.

Compared to downstream plant operating rate which still remains on the high side, PX plant operating rate has reduced and is expected to keep low in the near future. Besides from some scheduled plant maintenance, some PX plants cut run rates due to lower feedstock availability or poor economics.

Company	Capacity (kt/yr)	Location	Turnaround
Sinopec HRCC	1000	Hainan, China	Dec 28 2021 - early May, 2022
Sinopec HRCC	660	Hainan, China	Mar 15-May 11
Sinopec Yangtze	890	Jiangsu, China	Late Mar, for 2 months
GS Qingdao Lidong	1000	Shandong, China	Mar 25 - end of Apr
ZPC		Zhejiang, China	O/R cut by 15% in Apr
Sinopec ZRCC	750	Zhejiang, China	May 26 - late Aug
Zhongjin PC	1600	Zhejiang, China	1-week maintenance, date undecided
FCFC	300	Taiwan	Apr, for 45 days
Petronas	550	Malaysia	Early Feb, for 50 days
Idemitsu	210	Japan	Apr, for 2 months
OMPL	920	India	Shut in early Nov 2021
Oman Aromatics	820	Oman	Shut in late Dec 2021

The operating rate of PX plants is estimated to stay low through Apr-May. However, any reduction in PTA plant operating rate could be limited in spite of negative profits, unless polyester plant operating rate declines fast. Therefore, China PX supply and demand are expected to remain relatively tight in Apr-May, with inventory anticipated to shed by 200-300kt in that two months.

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