The polyester filament market showed clear signs of sluggishness on June 25, with the average sales-to-production ratio among sample enterprises dropping to 29.5%, a sharp decline of 16.1 percentage points from the previous trading day. Several companies reported ratios between 10% and 30%, with a few even recording zero. This data highlights a serious disconnect between costs and demand in the chemical fiber supply chain.
The Vicious Cycle of Falling Costs and Wait-and-See Procurement
The persistent decline in raw material costs was the direct trigger for the collapse in the sales ratio. When feedstock prices are on a downward trend, downstream weaving mills and traders generally adopt a "buy on rising, not on falling" mentality, postponing purchases in anticipation of even lower prices. This sentiment was fully reflected in the June 25 data: even when some producers lowered their offers, actual transactions remained scarce.
Looking at the sample distribution, very few enterprises achieved a sales ratio above 50%, with the majority concentrated in the 20% to 40% range. This indicates that even essential purchases were limited to small lots and urgent orders, lacking continuity. For polyester filament plants, inventory pressure is building rapidly, and price-cutting strategies have limited effect in a falling cost environment.
What Does a Sales Ratio Below 30% Mean?
The sales-to-production ratio is a core indicator of how well a chemical fiber company's daily sales match its output. Industry norms consider 50% to 80% as a normal range, while below 30% signals that the market has entered a deep wait-and-see phase. The June 25 data not only fell below this warning line but also showed a double-digit decline from the previous day, indicating a shift in market sentiment from caution to pessimism.
This sentiment transmits along the supply chain as follows: falling PTA and ethylene glycol prices → weakened cost support for polyester filament → plants try to destock by lowering prices → buyers expect further price drops → procurement is further delayed. Breaking this cycle requires either stabilization on the cost side or an unexpected increase in demand.
Regional Industrial Response: How Weaving Mills Are Adapting
In major polyester filament consumption areas such as Shengze, Changxing, and Xiaoshan, weaving mills have generally adopted a "produce-to-order" strategy. Late June falls in the traditional off-season, with domestic orders declining and export orders facing uncertainties from shipping volatility and exchange rates. Under these conditions, mills maintain raw material inventories of 3-7 days, far below the peak season level of 10-15 days.
This low-inventory strategy in turn slows destocking for polyester filament plants. If costs continue to fall, the sales ratio may deteriorate further, and some small- to medium-sized polyester plants may be forced to cut production or schedule maintenance. Large, concentrated industry leaders have some resilience, but if the off-season lasts longer than expected, production cuts may broaden.