PX Destocking to be Seen in Q2, 2024
The majority of PX plants in China are integrated refining and chemical facilities that use catalytic reforming methods. As a result, they often follow the same maintenance schedule as refineries. Refinery maintenance is typically performed between March and May, with major maintenance occurring every four years and minor maintenance occurring every two years. At the same time, because many PX units operate in an integrated production mode, shutdown and restart incur substantial costs and risks, therefore PX producers rigorously adhere to maintenance plans.
The maintenance timetable for PX units in Asia in 2024 remains consistent with prior years, beginning in March and running until the end of the second quarter. In terms of maintenance scale, China's Spring maintenance involves PX capacity of 12.4 million mt/a, whereas foreign maintenance involves 1.5 million mt/a. China’s maintenance intensity is higher than that of other countries, owing to China’s decreased reliance on PX imports in recent years, and the operating rate of PX units in Japan, South Korea, and Southeast Asia has already been low, with a significant increase in long-term shutdown units. Overall, the current maintenance plan is broadly consistent with market expectations.
By March 20, the operating rate of the PX industry was 86.08%, a relatively high level in history. The latest maintenance will be Zhejiang Petroleum & Chemical’s 2 million mt/a PX unit from the end of March to early April. China’s domestic PX market has been in a cumulative inventory cycle since 2024, with the market’s supply-demand mismatch worsening, resulting in a relatively weak trend in PX prices. In terms of PX unit maintenance arrangements for the second quarter, the market is focusing on two points. The first is the progress of PX unit maintenance; second, if PTA processing fees are reduced, the stability of some PX units would suffer. As a result, the market negotiation atmosphere is often cautious. At the same time, cost and variations in oil-blending demand will have an impact on the future PX market fluctuations. As a result, China's PX inventory is projected to drop, but the degree of destocking needs to be tracked.
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