In early September, the textile raw material market did not usher in an across-the-board peak season; instead, it exhibited a typical divergence pattern of strong materials and weak demand. Zheng cotton futures closed at 17,110 yuan/ton, up 50 yuan from the previous settlement, while the spot 3128B price index fell 53 yuan to 18,357 yuan/ton, widening the futures-spot spread to 1,247 yuan/ton—a clear reflection of divergent views on future supply and current demand.
Futures-Spot Divergence and Supply Expectations
The divergence in the cotton market is not accidental. Futures remained firm mainly due to expectations of tight supply before new cotton hits the market, with some ginners in Xinjiang having started pre-purchasing seed cotton, drawing attention to output and acquisition costs. However, spot transactions were dull, with mills refraining from large-scale stockpiling and old cotton consumption proceeding at a moderate pace, indicating limited acceptance of current prices.
This state of hot futures and cold spot suggests the market is pricing in supply pressure from the upcoming new cotton harvest. As harvesting approaches in northern Xinjiang, a massive influx of new cotton will likely weigh on futures, capping upside and suggesting a wide range-bound market rather than a sustained rally. For buyers, chasing prices now carries more risk than opportunity; it is better to wait for clearer new cotton pricing.
Cotton Yarn Order Divergence and Inventory Pressure
The cotton yarn market shows firm prices but divergent orders. Futures edged up and spot quotes rose in tandem, yet the recovery is limited—the anticipated large peak-season orders have not materialized, with transactions dominated by small and short orders, reflecting unstable end-demand recovery.
Product structure divergence is pronounced: medium-to-high count compact yarns sell smoothly, while low-count yarns face sluggish demand with rising finished goods inventories. This stems from limited improvement in downstream weaving mill operating rates and high grey fabric inventories. Procurement strategies vary: small mills continue hand-to-mouth buying to avoid price risks, while large and medium mills restock moderately, using post-pricing models to lock costs, showing divergent views and caution.
For yarn prices to break higher, sustained order releases from end-users are essential. The current state of rising prices without volume implies a tug-of-war between upstream and downstream—weavers avoid high-priced stockpiling, while spinners resist price cuts. The deadlock will break depending on the actual landing of autumn/winter orders.
Polyester Staple Fiber: Cost-Driven Surge and Risks
Polyester staple fiber (PSF) emerged as a bright spot, with mainstream quotes surging to 8,080 yuan/ton, up 200 yuan in a single day, outpacing cotton-related products. This rally is primarily cost-driven: upstream PTA and MEG prices strengthened, coupled with maintenance at some chemical fiber plants and industry output cuts to support prices, tightening spot supply.
However, demand has not exploded in tandem; downstream weaving enterprises are only purchasing on a need basis, with no concentrated stockpiling. This suggests the rally's foundation is not solid—if upstream feedstock prices fall or maintenance ends and supply increases, PSF prices will face downward pressure. Short-term cost support remains, but the sustainability of the rally hinges on actual end-consumption.
Strategies Amid the Game
Overall, the textile chain at the start of the golden September is in a tug-of-war between costs and demand. Cotton awaits direction from the new harvest, cotton yarn depends on downstream orders, and PSF is highly linked to petrochemical feedstock fluctuations. For textile enterprises, chasing highs blindly is inadvisable; rational inventory risk management is key.