Polyester DTY prices showed a subtle softening at the start of July. On July 3, Kaisi Group cut its offer for 150D/48F semi-dull low-elastic DTY to 9,300 yuan/ton, valid for seven days. Just one day earlier, the market benchmark stood at 9,318.75 yuan/ton. Though a single mill's adjustment, it may signal the near-term direction of the entire polyester chain.
Cost and Supply-Demand Logic Behind the Price Ease
The current pricing of DTY hinges on upstream PTA and MEG trends. Since late June, international crude oil has fluctuated downward, dragging PX prices and weakening PTA cost support. Meanwhile, MEG port inventories continue to accumulate, putting pressure on spot prices. This dual cost decline has opened room for polyester filament yarn price drops.
On the supply-demand side, polyester plant operating rates remained around 86% in June, but downstream weaving mills—hit by summer power curbs and weak end-order intakes—saw their utilization fall from 72% in May to about 68%. Gray fabric inventories in major weaving hubs like Shengze and Changxing generally exceed 35 days, forcing mills to slow raw material purchases due to cash flow pressure. Kaisi's price cut directly reflects expectations of weak downstream buying appetite.
Notably, the adjusted specification—150D/48F—is the mainstream type used by water-jet looms for lining and down jacket fabrics, with massive market circulation. Once this specification loosens, it can easily trigger chain reactions among similar products.
Industrial Cluster Transmission: From Xiaoshao to the Nation
Kaisi Group is based in Xiaoshan, Hangzhou, a core enterprise in the Xiaoshao polyester cluster, which accounts for about 30% of national polyester filament capacity. Its quotations are traditionally seen as a bellwether for the East China market. After Kaisi's move, neighboring mills have followed suit. Industry data shows that on July 4, another major mill in Xiaoshan lowered its same-spec DTY offer to 9,280 yuan/ton.
The price decline has a dual psychological impact on downstream buyers. For weavers with firm orders, current levels are close to some traders' restocking thresholds. But persistent price drop expectations reinforce a 'buy on uptrend, not downtrend' wait-and-see attitude. Purchasing managers in Nantong and Wujiang—key home textile production areas—report maintaining only 7-10 days of raw material inventory, well below the normal 15-20 days.
Superimposed Effect of Export Orders and Exchange Rates
Apparel and home textile exports account for about 40% of DTY end demand. Current renminbi exchange rate volatility has reduced overseas buyers' acceptance of yuan-denominated quotes. Meanwhile, competitors like Bangladesh and Vietnam are ramping up polyester yarn capacity, diverting some orders. Export firms face the dilemma of falling raw material costs but stagnant orders, making the demand for price locking in contracts stronger than ever.