China's two major PTA makers to reduce run rates to 80% amid thin margins

03-Jul-15

China's two major purified terephthalic acid producers -- Zhejiang Yisheng Petrochemical Co. and Hengli Petrochemical -- announced plans to cut production rates due to thin margins, sources close to the companies said Thursday, as per Platts. The announcement by China's two biggest PTA producers Thursday have resulted in a sharp upsurge in PTA futures on the Zhengzhou Commodity Exchange. Zhejiang Yisheng Petrochemical Co. will cut run rates at two of its PTA plants in Dalian to 80% effective Thursday, while Hengli Petrochemical will cut rates to 80% at three of its PTA plants also in Dalian, sources close to the two companies said. Zhejiang Yisheng's two PTA facilities at Dalian have a combined capacity of 5.95 mln tpa -- the No. 1 PTA unit with 2.2 mln tpa and the the No. 2 unit with 3.75 mln tpa. Both units were operating at 95% prior to the production cut, said a source close to the firm.