Analysis Of The Impact Of Taiwan Explosion On PX Market

The three aromatics factory of maoliao six light industrial area in Yunlin County of Taiwan was exploded 14 hours in March 7th, and the fire department decided that the liquefied petroleum gas (LPG) pipeline was broken by the butane tower.

The fire was controlled at 16, and no casualties were found.

The six light is known as the "sixth sets of light oil cracking plant". It is located in the Islands type basic industrial zone in maoliao District of Yunlin county. It is invested and developed by the Formosa Plastics Group. It is the sixth light oil cracking plant in Taiwan and first private refineries in Taiwan.

In July 1994, the government formally launched the new land on the west coast of the maoliao River by means of reclamation and was officially operated in 1998.

Taiwan chemical fiber Limited by Share Ltd is divided into three departments, one chemical, two and three.

The annual capacity of the aromatics plant's total BZ, PX, OX and TOL is 1 million 280 thousand tons, 1 million 720 thousand tons, 480 thousand tons, 100 thousand tons and 20 thousand tons respectively.

Its docking of the three chemical industry, PTA capacity of 1 million 100 thousand tons / year.

It is understood that Taiwan aromatics three plant is not the first accident.

The explosion of pipeline hydrogen in September 2015 led to gas explosion. The aromatics plant returned to supply within two weeks, resulting in a PX price increase of about 30-40 US dollars / ton.

A total of 1 million 720 thousand tonnes of PX installations have been installed on the platform. At present, the line 3 of the PX plant is in a shutdown state with a capacity of 870 thousand tons / year, and the 3 line is scheduled to be shut down for one month.

The other 1 line PX installation 270 thousand tons / year and line 2 PX device 580 thousand tons / year is still normal boot.

In addition, the company plans to overhaul the No. 1 installation in mid April to the end of May for 45 days, and repair the 2 line in the middle of August for two to three weeks.

In March 8th, after the first trading day of the Taiwan Trade explosion, the spot trading price of PX rose sharply. In May, the volume of paper goods was $1070 / ton CFR, which was up 38 US dollars / ton compared with the previous trading day.

PTA futures opened trading, but by Hengli Petrochemical 2 million 200 thousand tons and Yanda Grand 3 million 750 thousand tons PTA device resumption of production, PTA futures prices fell, night plate PTA futures prices bottom shocks.

The price of PX began to fall in the afternoon, and the price of PX rose by 13.67 US dollars / ton on the same day, to 1052 US dollars / ton CFR China and 1033 US dollars / ton FOB Korea.

In 2018, China's PX imported a total of 15 million 900 thousand tons. In 2018, the top three of the countries or regions imported by PX were Korea, Japan and Taiwan, and the import volume reached 66.83%.

Taiwan accounted for 9.99% of imports, with an average import of 132 thousand and 400 tons per month.

At present, Taiwan is the only PX manufacturer in Taiwan, and another PX plant CPC is in a state of shutdown for a long time.

Affected by the temporary shutdown of the platform device, it is expected to affect the supply of 72 thousand and 500 tons. As the PX is mainly dominated by long contracts, some of the downstream PTA factories that have purchased PX have been heard to discuss with other factories about the purchase of goods.

However, due to the limited capacity of the Mai Liu shutdown facility, the impact on PX is limited.

The main factors that will affect the price of PX are:

Cost side: because of the continuous good news of OPEC production cut, oil price broke through 70 US dollars / barrel, naphtha price increased with crude oil, resulting in PX profit continued to decline.

Demand side: downstream PTA inventory is low on the whole and processing fee is high.

Polyester is in low inventory and high profit state.

Terminal weaving appears slow shipping, high inventory, thin profit or loss, and terminal market is weak.

At present, the profit and price of polyester industry chain are in a high position. It is unlikely that the downstream market price will continue to rush high, and the short-term price will be supported. There will be some risks in the long term market.

Supply side: Recently, the overhaul of the PX device is much more, and the device to be overhauled is also in the majority.

The news of the first phase of Hengli petrochemical PX has basically been digested. Due to the low supply, the short-term PX price is expected to be narrowed. In the long run, prices will continue to fall.

Appendix: 2019 PX global overhaul schedule