The day Brent crude crossed the $100 mark, polyester futures surged across the board, only to see gains steadily erode by the afternoon. That reversal is more telling than the rally itself: the cost-side impulse failed to translate into sustained downstream buying.
Cost Side: A Tug-of-War Between Geopolitical Premium and Supply Recovery
With Middle East tensions showing no sign of easing and Houthi attacks on Saudi oil facilities intensifying supply risks, the geopolitical premium was quickly priced into polyester feedstock. Yet the supply picture is diverging internally.
On PX, with units at Weilian, Shenghong and Fuhua restarting, domestic operating rates rebounded sharply from below 60% to around 77%, with Asian units also improving. The Huajin Aramco new facility is expected to come online in October-November, while Fuhua, Hainan Refining and Yangzi Petrochemical have restart plans for mid-to-late September. This means PX domestic supply is rising systematically, though Asian refiners remain constrained by strait navigation issues, making a large-scale load increase difficult.
PTA supply recovery is more definitive. Previously idled units continue to restart, with Dushan Energy, Yisheng New Materials and Jiaxing Petrochemical resuming operations. Operating rates have climbed noticeably, and processing fees have fallen to around 400 yuan/ton. For PTA producers, this level means profit margins are significantly squeezed, and supply pressure is shifting from expectation to reality.
MEG follows a completely different logic. Widespread shutdowns in the Middle East combined with strait navigation disruptions mean the import gap cannot easily be filled by domestic idle capacity or other regions. Imports have plummeted since Q2, supply has tightened continuously, and geopolitical tensions keep delaying the expected return of imports. MEG imports are forecast to stay below 200,000 tons in September-October, keeping spot liquidity tight.
Demand Side: Production Cuts and Pulse Buying
Downstream polyester performance stands in sharp contrast to the feedstock frenzy. Staple fiber and bottle chip have seen the most pronounced run cuts. Since mid-August, profits at both have been compressed, processing fees have hit new lows, forcing more producers to reduce output. Staple fiber operating rates have fallen to around 70%, while bottle chip plants have dropped to a historic low of 60%.
The implication is that downstream factories are not without orders. Rather, amid high and volatile feedstock prices and recurring geopolitical tensions, they have chosen to cut runs and control inventory. Purchasing behavior is pulse-like—buying on dips, watching on rallies—with broadly cautious sentiment. September polyester loads are expected to stay below 80%, and peak-season performance will likely fall short of expectations.
For buyers, this means spot liquidity in certain grades, especially MEG-related, may continue to tighten, making the timing of restocking more difficult. For factories, with processing fees under sustained pressure, cutting output to defend prices may become a阶段性 norm.
Outlook: Passive Gains and Potential Rebound
Despite weak demand, polyester futures and spot prices have been passively lifted by continuously rising costs. Hongye Futures believes that Middle East geopolitical disruptions will be hard to resolve in the short term, and the polyester market is expected to remain relatively strong on cost support.
The core logic: current price gains are cost-driven, not demand-driven. Once geopolitical tensions ease, suppressed downstream demand could rebound, providing a boost. Until then, the polyester chain will likely maintain a cost-supported, range-bound upward bias, with inter-product divergence—PX and PTA supply recovering, MEG supply tight—becoming the key variable for processing fees and spread structures.