In 2010, new paraxylene production capacity expanded by 800,000 tons to reach 9.06 million tons, while PTA production capacity increased by 4.4 million tons to reach a total capacity of 19.96 million tons.
Based on the calculation that 0.655 tons of PX is needed to produce 1 ton of PTA, there is serious mismatch between PX and PTA capacities, therefore, the tight supply situation of PX is expected to aggravate in 2011.
Due to the supply constraints, PX price is anticipated to stay above US $1,350 / ton in 2011. The average profit of PTA producers was 1,000 Yuan / ton based on spot price of PX in 2010, about 50 percent higher than 2009.
PTA production profit will be compressed with higher price of PX in 2011, but PTA producers have large scale capacities, leading to higher pricing power. This in turn will push PTA prices higher in 2011 coupled with high PX prices.
Experts are of the opinion that, PTA industry will continue to maintain high profits in 2011.
Fibre2fashion News Desk - China