International crude oil prices have fallen back to pre-Middle East crisis levels, yet polyester filament yarn remains nearly 1,000 yuan per ton higher. On June 24, WTI crude briefly broke below the $70 mark. Although it rebounded slightly the next day due to renewed geopolitical tensions, it hovered around $70 again on June 26. This abnormal spread reveals deep-seated games along the polyester industrial chain.
Behind the Spread: Capacity and Inventory Realities
Based on public data, the capacity utilization rate of domestic direct-spun polyester filament units stood at 73.81% on June 24, up just 0.29% from the previous week. While the change seems modest, the current load is at a three-year low. Low operating rates have effectively controlled inventories—POY at 30 days, FDY at 35.7 days, and DTY at 41.8 days. However, these inventories were produced using higher-cost raw materials; price cuts would turn unrealized losses into real ones. Polyester mills prefer a strategy of 'slow price cuts, slow sales' rather than aggressive destocking.
Meanwhile, PTA and MEG futures have essentially returned to their starting points, creating very attractive cash margins for polyester filament. For weavers, high cash margins imply significant future downside risk. Unless they have urgent orders to fulfill, the prevailing mindset is 'buy only when necessary'—delaying purchases by a month could save hundreds or even thousands of yuan per ton on raw materials, while producing identical fabrics.
Core Issue: Strong Supply, Weak Demand
The fundamental divergence in the industrial chain stems from strong supply versus weak domestic demand. Summer is typically peak season for sun-protective clothing, but unseasonably cool weather near July has delayed related demand. Weak domestic demand directly suppresses polyester filament procurement.
However, the market is not without bright spots. With the Strait of Hormuz shipping channel fully reopened, global crude oil and commodity trade order is gradually recovering. Multiple overseas economies are accelerating their recovery, which could boost international textile consumption demand. Subsequent export order increments may partially offset domestic pressure and ease the downward pressure on the polyester filament market.
Short-Term Game Unlikely to Break
In summary, the 'weak supply-demand, high spread' pattern in the polyester industry chain is likely to persist in the near term. The tug-of-war between upstream and downstream will continue to dominate market direction: polyester mills hold pricing power through low operating rates and manageable inventories, while weavers apply pressure through delayed procurement, betting on further price declines. A real turning point may come when export orders concentrate or seasonal domestic demand picks up.