On June 22, the average production-sales ratio of polyester filament sample enterprises stood at merely 39.5%, a meager 1.3 percentage point increase from the previous trading day. This figure falls far below the industry's typical equilibrium line of 70%, indicating an oversupply across the market. Public sample data reveals a wide dispersion among 20 enterprises, ranging from 0% to 120%, with the majority concentrated in the 20%-45% range and only a handful achieving over 100%, underscoring downstream users' cautious stance on current prices.
Background
The production-sales ratio serves as a barometer of supply-demand dynamics in the chemical fiber chain. When the ratio dips below 50%, it typically signals that downstream weaving mills are consuming their own inventories with minimal new procurement intent. The June 22 data further confirms this wait-and-see sentiment: spot trading is sluggish, and even relatively firm polyester filament varieties have failed to trigger bulk transactions. Industry public data shows that since mid-June, the ratio has lingered below 40% for several consecutive days, closely correlated with a temporary lull in end-use apparel export orders.
Notably, the divergence in ratios also reflects differences in customer portfolios and product mixes among enterprises. Differentiated varieties (e.g., fine denier yarn, cationic yarn) show relatively higher ratios, while conventional grades remain depressed. This suggests that structural opportunities persist beneath the overall weakness, albeit on a limited scale.
Industry Impact
The direct consequence of persistently low production-sales ratios is the passive accumulation of polyester filament inventories. Historical industry experience indicates that when the ratio stays below 50% for two consecutive weeks, polyester plants' inventory days typically rise from the normal 7-10 days to over 15 days, prompting price cuts or production curtailments. Once this transmission chain kicks in, it directly compresses processing margins in the polyester segment and may create negative feedback to upstream PTA and MEG.
For downstream weaving mills, the current low ratio implies expanding bargaining room. Most mills maintain just-in-time procurement, waiting for polyester plants to offer further concessions. However, this game carries risks: if crude oil or PX prices spike suddenly, polyester costs could rapidly escalate, leaving mills that missed the current low-price window facing cost pressures. Additionally, the recovery of textile capacity in Vietnam and Bangladesh is diverting some orders originally destined for China, further dampening domestic chemical fiber demand elasticity.
Regionally, shipment speeds in polyester clusters like Shaoxing and Xiaoshan have notably slowed, with some traders reporting that downstream inquiry frequency has dropped from multiple times daily to once every other day. This pace change suggests that the chemical fiber market will likely maintain a weak, volatile pattern through late June into early July.