Cotton and PTA moved in opposite directions on July 2, with the daily price gap widening to nearly three times. According to industry data, cotton edged up 0.30% to 17,781.83 yuan/ton, while PTA plunged 1.57% to 5,686.84 yuan/ton. This divergence is not accidental but reflects the distinct fundamentals of each raw material.
Cotton's Resilience: Tight Supply and Cost Support
Cotton prices have been running above 17,700 yuan/ton, with a year-on-year increase of 17.29%—a standout among textile raw materials. The core drivers are twofold: first, expectations of reduced domestic cotton acreage in the 2025/26 season are materializing, narrowing the supply window before new crop arrivals; second, international cotton prices remain elevated due to weather disruptions in major producing countries, transmitting costs to domestic spot markets.
Notably, cotton yarn 21S and 32S prices held flat at 23,400 and 24,725 yuan/ton, up 7.50% and 6.57% year-on-year respectively. The fact that yarn prices did not follow cotton higher suggests downstream weaving mills have limited appetite for further cost increases. Spinners now face a squeeze: rising raw material inventory costs but constrained room to raise yarn prices.
Chemical Fiber Under Pressure: PTA Leads Decline Amid Oversupply
PTA fell 1.57%, the biggest daily drop in the textile sector. This was not isolated—acrylic fiber dropped 0.50%, polyester staple fiber and polyester yarn each fell 0.42%, signaling broad weakness in the chemical fiber chain. The root cause lies in deteriorating supply-demand dynamics: ample upstream PX supply, high PTA plant operating rates, and downstream polyester demand entering a traditional off-season, leading to faster inventory buildup at polyester plants.
Although PTA prices are still 13.03% higher year-on-year, the recent correction signals growing pessimism about H2 2026 supply-demand balance. Polyester POY, DTY, and FDY prices were unchanged on the day but are up 9.55% to 14.06% year-on-year, suggesting earlier gains have already priced in some demand. If PTA cost support weakens further, the entire polyester chain faces catch-down risk.
What Divergence Means: Profit Reallocation Along the Chain
The divergence between cotton and chemical fibers essentially reflects different profit allocation across supply chain stages. Cotton supply is more rigid due to acreage and weather constraints, while chemical fiber capacity is more elastic and vulnerable to new capacity additions and demand fluctuations.
For textile enterprises, this divergence calls for more refined procurement strategies. Cotton mills should monitor supply rhythms ahead of new crop arrivals and build positions on dips; chemical fiber users should be wary of PTA declines dragging down polyester product pricing and avoid stockpiling at high levels. Spandex prices rose 21.09% year-on-year, the largest gain among all tracked items, linked to sportswear demand recovery and slower capacity expansion, but high margins attract new entrants—capacity release pace in mid-term warrants attention.