Jiangsu Polyester Staple Fiber Spot Price Drops 65 Yuan Amid Cost and Demand Pressures

The spot price of polyester staple fiber (PSF) in Jiangsu experienced a notable decline on June 12, dropping 65 yuan/ton to 7,825 yuan/ton. Morning negotiation ranges were concentrated at 7,800-7,850 yuan/ton, with some lower-end deals touching 7,700-7,750 yuan/ton. This decline, uncommon in recent PSF trading, reflects a dual pressure from weakening upstream cost support and sluggish downstream demand.

Cost Side: PTA and MEG Weaken in Tandem

Both PTA and MEG, the direct raw materials for PSF, have seen price declines in early June. PTA spot prices in East China have fallen below the 5,800 yuan/ton threshold, down about 150 yuan/ton from late May, tracking the volatility of international crude oil. MEG has also weakened, with East China spot prices dropping to around 4,400 yuan/ton, down nearly 100 yuan/ton from the start of the month, as port inventories continue to accumulate. The collective weakness in raw materials has directly lowered the polymerization cost for PSF, leaving producers with little support for pricing.

Supply and Demand: Weaving Operating Rates Decline, Procurement Remains Just-in-Time

On the demand side, operating rates at downstream weaving and texturing mills have slipped slightly in early June. The comprehensive operating rate for water-jet looms in Jiangsu and Zhejiang has fallen to around 70%, down 2-3 percentage points from late May. New orders for garment exports have entered a traditional slack season, with slower order placements leading to a modest increase in greige fabric inventories. In this context, yarn mills have adopted a conservative procurement strategy for PSF, with most replenishing only on a need-to-basis and avoiding building raw material inventories exceeding one week. Traders also show little appetite for stockpiling, resulting in subdued market activity.

Price Outlook: Downside Risk Remains in the Short Term

With PSF prices having broken below the 7,800 yuan/ton psychological level, further declines to 7,700 yuan/ton or lower cannot be ruled out if raw material prices continue to weaken. Historically, PSF prices during the same period in 2025 fluctuated between 7,600 and 7,800 yuan/ton, meaning current prices are still slightly above year-ago levels, suggesting that the downside has not been fully exhausted. For PSF producers, processing margins have narrowed to within 300 yuan/ton, with some small and medium-sized enterprises facing breakeven pressures that may force production cuts.

Transmission Effects Along the Supply Chain

The PSF price decline will ripple downstream. For yarn mills, lower raw material costs could improve margins, but if orders remain insufficient, the gains may be offset by falling yarn prices. Weaving mills may see a slight reduction in greige fabric costs, but end-customer price pressures will also intensify, limiting actual benefits. Export-oriented companies should monitor PSF price volatility when quoting export orders to avoid locking in high costs during a falling market.

Practical Recommendations

For Buyers - Adopt a phased procurement strategy to avoid large one-time purchases and reduce inventory devaluation risk. - Monitor PTA and MEG futures night trading; consider increasing purchases if raw material prices show signs of stabilization. - Negotiate short-term price protection clauses or floating pricing terms with suppliers to lock in floor prices.

For Exporters - Build a price fluctuation buffer into quotations, recommending a 2%-3% downward adjustment in PSF cost assumptions to accommodate customer price pressures. - Use forward forex hedging tools to manage RMB exchange rate risk and avoid dual losses from cost and currency movements. - Track PSF price trends in Southeast Asian and South Asian markets; if the domestic-overseas price spread widens, consider shifting export targets accordingly.