A rare divergence is unfolding between crude oil and polyester filament yarn prices. On June 24, 2026, WTI crude oil briefly fell below $70, returning to pre-Middle East crisis levels. Although it rebounded slightly on the 25th due to renewed regional tensions, it hovered around $70 again on the 26th. Yet polyester filament yarn prices have not followed suit, remaining nearly 1,000 yuan per ton higher than before the surge.
Behind this premium lies a deep game between upstream and downstream players in inventory, costs, and expectations.
The Paradox: High Cash Flow vs. High Costs
From a futures perspective, PTA and MEG have largely returned to their starting points, theoretically stripping cost support from polyester filament and giving it substantial paper cash flow. But the reality for polyester plants is far more complex. Current inventories stand at about 30 days for POY, 35.7 days for FDY, and a staggering 41.8 days for DTY. These stocks were produced during the high-oil-price period, with costs significantly above current feedstock levels.
If plants cut prices now, they would turn paper losses into real losses. With capacity utilization at only 73.81%, there is little pressure to clear inventory quickly. The preferred strategy is to lower prices gradually and sell slowly, buying time.
Downstream Weavers: A Rational 'Buy-Only-When-Necessary' Stance
For weavers, the high cash flow of polyester yarn signals a high probability of future price declines. If they are producing for stock rather than for orders, delaying purchases by a month could save hundreds or even thousands of yuan per ton. Consequently, the market has entered a 'buy-only-when-necessary' wait-and-see mode.
This sentiment is reinforced by weak end-demand. Unseasonably cool summer weather has delayed the seasonal peak for sun-protective fabrics, further dampening weavers' purchasing appetite. The core issue remains a supply-demand imbalance and sluggish domestic consumption.
External Variable: Can Exports Break the Deadlock?
However, not all signals are bearish. With the full reopening of the Strait of Hormuz shipping channel, global crude oil and commodity trade is normalizing, and multiple overseas economies are accelerating their recovery. This could boost international textile demand, providing support for China's textile exports.
Incremental export orders may partially offset domestic weakness and ease downward pressure on the polyester yarn market. But in the short term, the pattern of weak demand and high price spreads will persist, with upstream-downstream bargaining continuing to dominate.