China PX Import Remained High in H1, 2019

China’s PX import dependence keeps high. PTA demand keeps rising, while PX output fails to keep pace. Against the backdrop, imports from South Korea, Japan and India keep swarming into China. Though the newly added capacity at Hengli Petrochemical started up in 2019, the output failed to meet expectations. In addition, annual contracts at some enterprises lasted to June. Therefore, high PX import volume continued in China in H1, 2019.

China’s PX import volume recorded at 5,657.60kt in January-April 2019, up 8.37% Y-O-Y. Entering 2019, the PX import volume each month was as high as 1,300kt. There were three reasons. First, the demand from PTA was strong. Downstream uses ran at highs overall, and they showed strong replenishing appetites ahead of the Spring Festival holiday. Moreover, newly added capacity at Sichuan Energy Investment came online as scheduled, boosting the demand for PX further. Second, though Hengli Petrochemical put its 4,500kt/a PX capacity into operation, it still imported a large quantity of PX, considering the annual contract. Third, turnarounds at a host of companies in China were ongoing in H1, 2019, such as Sinopec Luoyang Petrochemical, Sinopec Urumchi Petrochemical. Therefore, China’s PX import volume remained high in 2019, and average import prices showed a downtrend, tracking crude oil and oversupply.

China mainly imports PX from Asian countries, such as South Korea, Japan and India. Japan and South Korea, adjacent to China, enjoy high PX output. India expands its export to China by virtue of newly added capacity.

China mainly imports PX via Dalian, Nanjing, Ningbo, Hangzhou and Xiamen customs, which are close to PTA production and consumption.

China mainly imports PX via the trade mode of general trade. With the continuous development of China free trade zone, the volume via inbound and outbound goods in supervised bonded areas will be increasingly high.

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