On June 24, the polyester filament yarn (PFY) sales-to-production ratio among sample enterprises rebounded to 45.6%, up 11.4 percentage points from the previous trading day. On the surface, this signals market warming. However, a closer look reveals extreme divergence: some firms reported ratios as low as 10%, while one reached 150%. This disparity underscores deeper structural issues in the chemical fiber market.
Short-Term Recovery Driven by Price Cuts
The rebound was not fueled by broad demand recovery. Industry tracking data shows that several PFY factories adopted promotional price cuts to stimulate spot trading. In other words, the sales growth came at the cost of margin erosion. With raw material costs remaining high and downstream orders sluggish, the sustainability of this "volume-for-price" strategy is questionable.
Among the 23 sample points, only one firm achieved a ratio above 100% (150%), and only two exceeded 80% (80% and 150%). The remaining 21 firms had ratios below 70%, with 13 (over 56%) below 40%. This indicates that most enterprises still face severe inventory pressure, and the effect of price promotions is uneven.
Bottlenecks in Downstream Transmission
The persistent low PFY sales ratio stems from weak demand transmission along the textile supply chain. Since June, loom utilization rates in the Jiangsu-Zhejiang region have declined, with many small weaving mills cutting production or suspending operations due to insufficient orders. End-brand destocking cycles have not ended, and procurement of fabrics and yarns remains limited to small, just-in-time orders.
This negative feedback loop—weak demand, mill slowdown, chemical fiber inventory buildup—is confirmed by the June 24 data. Even with price incentives, the ratio only reached 45.6%, far below the industry's "safe line" of 70%. This suggests that downstream absorption capacity is nearing a temporary bottleneck.
Regional and Product Differentiation
The divergence in sales ratios is not random. Industry feedback indicates that high-ratio firms are concentrated in traditional chemical fiber clusters like Xiaoshao and Wujiang, and primarily produce differentiated products such as fine-denier and high-filament-count yarns. These serve relatively resilient niches like women's apparel and home textiles. Low-ratio firms, by contrast, mainly produce standard specifications (e.g., POY 75D/36F, FDY 150D/96F), which face intense price competition and slower inventory turnover.
This divergence signals that competition in the chemical fiber industry has shifted from volume expansion to structural differentiation. Companies without product differentiation will continue to suffer in price wars.
Cost and Policy Variables
Upstream raw material prices for PTA and MEG have remained high and volatile, providing rigid cost support for PFY. If price promotions persist, profit margins will be further squeezed, potentially leading to a "sell more, lose more" scenario. On the policy front, several provinces have intensified environmental inspections on textile printing and dyeing since June, which may force small-to-medium dyeing plants to cut production, further suppressing demand for chemical fibers.
On the positive side, China's steady-growth policies continue to support textile and apparel exports, which maintain stable market share in Southeast Asia. Some leading chemical fiber companies have hedged against domestic pressures through overseas plant construction and product upgrades.