On July 3, Kaisi Group adjusted its ex-factory offer for polyester DTY (150D/48F, AA grade, semi-dull low-elastic yarn) down to 9,300 RMB per ton, with a validity period of seven days. This price represents a decline of 18.75 RMB from the industry benchmark of 9,318.75 RMB per ton recorded the previous day. While the reduction is less than 0.2%, it breaks the short-term price stalemate after the benchmark had held steady near 9,318.75 RMB for several consecutive days.
Price Signals and Industry Transmission
From a supply chain perspective, the easing of DTY prices is not an isolated event. Upstream PTA and MEG prices have been under pressure recently, destocking at polyester plants has slowed, and downstream weaving mills have slightly reduced operating rates due to summer power curbs and weak orders. As a leading polyester producer, Kaisi Group's price adjustments often carry directional significance: when a major player starts to offer concessions, it typically signals cautious expectations for future demand.
Notably, the DTY specification offered is 150D/48F, one of the most widely traded standard varieties. Its price movement directly impacts the procurement costs of small and medium-sized weaving mills. At the current level of 9,300 RMB per ton, the price is approaching the cost line for some mills. If it declines further, it may trigger phased restocking downstream.
Capacity Release vs. Demand Slowdown
In the first half of 2026, approximately 1.2 million tons of new polyester filament capacity came on stream in China, with DTY supporting capacity accounting for about 35%. The concentrated release of this new capacity has intensified supply pressure. Meanwhile, growth in end-use textile and apparel exports has slowed, and domestic demand has failed to absorb the excess supply due to the real estate after-cycle and weak consumer confidence.
This supply-demand imbalance is reflected in price dynamics: despite lower raw material costs, DTY profit margins have not expanded significantly but have been compressed by intensified competition. Kaisi Group's price cut essentially reflects the transmission of destocking pressure from upstream to midstream. For weaving mills, lower raw material costs are beneficial, but if final orders do not recover simultaneously, the profit improvement from price cuts will not be sustainable.
Ripple Effects in Regional Industrial Clusters
The price adjustment directly impacts polyester clusters in Xiaoshan, Shaoxing, and Wujiang, where numerous DTY texturing mills and water-jet weaving enterprises are concentrated. Any fluctuation in raw material prices quickly influences production and procurement decisions.
- In Xiaoshan, some texturing mills have begun adjusting operating rates to mitigate inventory devaluation risks from falling raw material prices.
- In Wujiang, medium-sized weaving enterprises indicate they will maintain only hand-to-mouth procurement at current levels, avoiding large-scale stockpiling.
- In Changxing, home textile fabric producers, already operating on thin margins, see some relief from lower raw material costs, but grey fabric price competition remains intense.
These regional variations highlight differing sensitivities to price signals across the supply chain. The texturing segment faces more intense price competition due to overcapacity, while the weaving segment focuses more on the actual recovery of final orders.
Outlook and Operational Strategies
Overall, DTY prices may find some support near 9,300 RMB per ton, but upward momentum is lacking. Short-term price direction depends on three variables: whether polyester raw material prices can stabilize, changes in downstream weaving operating rates, and the start of autumn/winter orders.