A 21% average sales-to-output ratio, down another 4.8 percentage points from the previous trading day—this is the scorecard for the polyester filament market on September 4. When high prices meet weak demand, the market is voting with its feet, and the ripple effects of this standoff may just be beginning.
Signals from the Data
Sales-to-output ratio is a sensitive gauge of the chemical fiber market. A 21% figure means sample enterprises sold only a little over a fifth of their output that day, down from 25.8% the day before. Public data shows that among more than 30 enterprises, most ratios fell between 10% and 20%, with some at zero and only a few reaching 40%. This divergence indicates that downstream weakness is not isolated but widespread.
What is more telling is the timing. September is traditionally the prelude to the textile peak season, when downstream weaving mills usually stock up for autumn/winter orders. However, this year's restocking enthusiasm has been dampened by high prices. Polyester filament prices remain elevated, downstream resistance has accumulated, and buying is limited to essential needs. This "the higher the price, the less buying" mentality is breaking the industry's usual "buy on rising prices" inertia.
Price Transmission Fails, Inventory Pressure Builds Upstream
The low sales ratio points directly to a fact: cost increases are not being smoothly passed down the chain. For polyester plants, this means product inventories may accumulate rapidly. If the ratio remains low, factories will face a choice between discounting to stimulate sales or cutting production to support prices. Historical experience suggests that when the ratio stays below 30% for several consecutive days, the pressure for price adjustments increases significantly.
For downstream weaving enterprises, high-priced raw materials squeeze profit margins, while final order recovery is insufficient to support high-priced purchases. This tug-of-war between upstream and downstream has led to a stalemate in transactions. Notably, some enterprises still achieved 40% ratios, indicating the market is not monolithic—some are still bargain-hunting or executing earlier contracts. This divergence provides a window for observing future price trends.
Adjusting Procurement Strategies Based on Sales Ratios
Fluctuations in the sales ratio are not just a barometer of market sentiment but also a reference for procurement decisions. When the ratio declines continuously, it often signals potential price softening, allowing buyers to slow restocking and wait for better entry points. Conversely, a rapid rebound may indicate demand recovery, warranting caution against price rebounds.
Current data suggests an increasingly buyer-friendly market, but this does not mean complacency. Raw material costs remain high; if factories cut production, supply contraction could push prices up again. Therefore, buyers should closely monitor factory operating rates and watch for consecutive rebounds in the sales ratio.