The sharp drop in oil prices has not brought expected benefits to the polyester industry chain. Instead, a fierce profit redistribution game is underway among upstream raw materials, midstream filament, and downstream weaving.
Cost Collapse and Price Stalemate
International oil prices fell rapidly after the US-Iran peace agreement, with the Strait of Hormuz resuming navigation, weakening raw material cost support. However, polyester filament prices have shown unusual resilience, failing to follow raw materials downward. This contrast has intensified internal contradictions: downstream weaving mills are waiting for filament prices to "catch down" to reasonable levels before restocking, as current raw material costs make orders loss-making.
Zero-Sum Game of Three Demands
Upstream raw material producers (PX/PTA) are most anxious. July's large-scale maintenance has reduced PX and PTA operating rates to low levels, but from August onward, as Strait shipping recovers and refineries end maintenance, supply will gradually return. Their core demand is for filament producers to raise operating rates to match supply recovery, enabling rapid destocking and balance sheet repair. The most effective lever to boost filament loads is price promotion to spur sales volume.
Midstream filament producers operate on a different logic. In past years, every raw material price drop triggered filament price cuts and promotions, compressing processing margins to near zero, making them mere "porters" for upstream. Now, by cutting production to protect margins—running at 70% capacity with a per-ton profit of 500 yuan versus 100 yuan at full capacity—they find it more economical. Cutting prices now would only deepen downstream wait-and-see behavior ("If it can drop today, will it drop tomorrow?") and undo their production cut efforts.
Downstream weaving bears the heaviest operational pressure. Before the oil crash, weavers faced "flour more expensive than bread"—high filament prices but unable to raise order prices, making spot purchases and production loss-making. Now with cost collapse but filament prices stubborn, downstream believes the high processing margins of filament are unreasonable and insists on waiting for price corrections.
Stalemate Core and Breakthrough Key
The current industry chain is trapped in a classic prisoner's dilemma: filament refuses to cut prices, downstream stays out, sales volumes remain low; low sales prevent filament destocking, making load increases impossible; without filament load increases, PTA sales stall, and upstream destocking stalls. No party is willing to make the first move.
Industry public data shows that filament producers' production cut resolve is the most critical variable. Cuts have built a profit "Great Wall" but also choked cash flow circulation across the chain. The breakthrough lies in whether filament can find a balance between protecting margins and stimulating sales volume—for example, through phased promotions to test downstream acceptance, or waiting until downstream inventories are depleted to the point of forced restocking.