The rapid squeeze in PX margin was mainly caused by disruptions of China domestic PTA plants

The rapid squeeze in PX margin was mainly caused by disruptions of China domestic PTA plants. Due to dual controls policy and unexpected issues, PTA plant operating rate declined sharply by 14.1 percentage points from end-Sep to 58.9% on Oct 9. Billion cut the operating rate of its 2.5 million mt/yr PTA plant to 50% on Sep 19, and was expected to recover in mid-Oct. Fuhua reduced PTA operating rate by 20% to 70% on Sep 30 and had recovered to 90%. Hengli shut its 2.5 million mt/yr PTA plant on Oct 8 for maintenance lasting 2 weeks. Yisheng Dalian shut its PTA plants with capacity of 6 million mt/yr on Oct 8 for 4 days. Jiaxing (Tongkun) shut its 1.5 million mt/yr PTA plant on Oct 9 temporarily. In addition, Honggang (Shenhong) shut its two PTA lines with combined capacity of 4 million mt/yr on Sep 14 and Sep 15 respectively.