On June 25, the average sales-to-production ratio of sampled polyester filament enterprises plunged to 29.5%, down 16.1 percentage points from the previous trading day. This figure is far below the industry's healthy level (typically above 60%) and marks the largest single-day drop in recent memory. The deepening cost decline has suppressed trading sentiment, bringing spot market activity to a near standstill.
Cost Side: Downtrend Accelerates Downstream
The direct driver of this precipitous drop in the sales ratio is cost collapse. Recent volatility in international crude oil prices, combined with persistent declines in raw materials like PX and PTA, has significantly lowered the production cost center for polyester filament. Downstream weaving mills, adhering to the 'buy on rising, avoid on falling' mentality, are holding cash and waiting for lower prices.
Historical patterns show that when polyester filament costs fall more than 3% in a single week, the sales ratio typically drops below 40% within one to two trading days. The current decline is larger and faster, indicating that market expectations for a price floor have turned pessimistic. Without signs of stabilization in raw materials, polyester filament prices still have room to fall, further curbing restocking demand.
Supply-Demand: High Utilization Meets Weak Orders
The 29.5% sales ratio reflects a severe mismatch between supply and demand. Polyester filament industry operating rates remain high, with some major producers running above 85% capacity. However, downstream weaving and texturing sectors are seeing declining operating rates due to insufficient orders and inventory buildup.
A closer look at the sample data reveals an extremely uneven distribution: most enterprises reported sales ratios between 10% and 40%, and some recorded 0%—meaning zero transactions for the entire day. This 'price without volume' state indicates that downstream purchasing appetite has hit rock bottom. Even factory efforts to offer discounts failed to stimulate demand.
More concerning is that this imbalance is not a temporary phenomenon. Since mid-June, the polyester filament sales ratio has hovered at low levels, with industry inventory pressure rising steadily. If costs fail to stabilize, production cuts may become a passive choice for some enterprises.
Regional and Chain Dynamics: Uneven Impact
From a regional perspective, the Jiangsu-Zhejiang area, as the main production and consumption hub for polyester filament, has reacted most sensitively. Weaving mills in clusters like Shengze, Changxing, and Xiaoshan generally report shorter order cycles and reduced restocking willingness. Some small and medium-sized mills have begun actively reducing operating rates to free up capital tied in finished goods.
Further upstream, price declines in PTA and MEG are equally severe. Polyester chip prices have followed the downtrend, squeezing profit margins for chip-spinning enterprises. The entire chemical fiber chain now exhibits a classic weak pattern: upstream falling, midstream holding on, and downstream waiting.
Market Outlook: Cautious but Bottom Signals Emerging
From a sentiment perspective, the market has entered a typical 'panic wait-and-see' phase. Scarce buying and aggressive price cutting among sellers suggest that an irrational sell-off is underway, which historically signals a bottom is approaching. However, when the bottom will arrive depends on two variables: the stabilization of crude oil and the recovery of export orders for textile and apparel.
For foreign trade enterprises, RMB exchange rate fluctuations and overseas destocking progress remain key disruptors. If restocking demand from European and American markets materializes in Q3, it could help lift polyester filament sales out of the current trough. But until then, all chain participants should prepare for a prolonged downturn.