Chemical Fiber Market Shows Divergence: The Supply-Demand Game Behind Low Production-Sales Rate Rebound

On June 24, the average production-sales ratio of polyester filament yarn sample enterprises stood at 45.6%, up 11.4 percentage points from the previous trading day. While still below the industry's widely recognized 50% threshold, the rebound is significant enough to draw market attention. It suggests that price promotions by some mills are starting to work, and downstream weaving mills' restocking willingness is marginally recovering.

Promotion Effects and Market Expectations

The data from 23 sample enterprises showed extreme divergence: the highest ratio reached 150%, while the lowest was only 10%. This dispersion indicates that the market is not broadly recovering; rather, mills with larger price cuts are capturing limited demand. Industry patterns show that when the ratio falls below 50%, inventory is usually accumulating passively. The current rebound is driven by price concessions rather than genuine demand expansion.

As a core midstream product in the chemical fiber chain, the production-sales ratio of polyester filament yarn directly reflects the transmission efficiency from polyester to weaving. Although the current 45.6% ratio has improved month-on-month, it remains low compared to historical levels. Combined with recent public data from June 22, 23, and 26, the market appears to be in a destocking cycle, with downstream purchases focused on small urgent orders and speculative restocking nearly absent.

Industry Impact and Upstream-Downstream Transmission

For polyester mills, persistently low ratios mean increasing cash flow pressure. While price promotions can temporarily generate cash, they further compress processing margins and may force high-cost capacity to cut production. Historical experience suggests that when the ratio stays below 40% for consecutive days, industry-wide production cuts become more likely.

For downstream weaving mills, current polyester filament yarn prices are at a cyclical low, but purchasing decisions must balance two factors: whether raw material prices have bottomed and whether their own orders can support restocking. With over half of the sample showing ratios below 30%, most weavers remain on the sidelines, only those with urgent orders choosing to replenish at lower prices.

Practical Recommendations

For Buyers - Monitor whether the production-sales ratio stays above 50% for three consecutive days, a signal that prices may stabilize - Adopt a phased restocking strategy to avoid bulk purchases driven by single promotions - Prioritize negotiations with mills whose ratio is below 30%, as they face greater destocking pressure

For Exporters - Leave room for raw material price fluctuations in export quotations, as polyester filament yarn prices have not yet stabilized - Monitor the recovery of Southeast Asian weaving capacity, which could divert demand for Chinese polyester filament yarn - Lock in forward raw material contracts at current low prices, but keep the term within 30 days