Surge in Polyester Filament Sales: A Battle Between Demand and Caution

On July 6, the average sales-to-production ratio of polyester filament sample enterprises closed at 71.9%, a sharp increase of 38.9 percentage points from the previous trading day. Behind this figure lies a continuation of the sales model by filament manufacturers over the weekend, with partial negotiations loosening, and a first concentrated response from downstream users who had held off for days. However, the 71.9% average masks significant disparities among enterprises. Among the 27 sample firms, the ratio ranged from 0% to 150%, with extremes of both 0% and 150% appearing simultaneously, indicating a fragmented market rather than a broad rally. Only about 18.5% of sampled firms achieved ratios above 100%, while most still struggled below 50%.

The Nature of the Rebound: Volume for Price Under Inventory Pressure The direct driver of this sudden surge in the sales-to-production ratio is the proactive price cuts and relaxed negotiation terms by polyester filament manufacturers over the weekend. Public industry data shows that polyester filament inventories had been accumulating over the previous week, with some firms' inventory days approaching warning levels. Concessionary pricing became the only viable option to relieve inventory pressure. However, the downstream response was not enthusiastic. The distribution of sales data reveals that essential procurement remains the mainstream—buyers adhere to a 'small lot, multiple batches' rhythm, with no significant increase in single order sizes. The rare instances of ratios exceeding 150% are more often due to concentrated pickups by major clients or execution of previously locked-in price orders, rather than a surge in new demand. This implies that the sustainability of this rebound depends on whether manufacturers can maintain their concessions and whether terminal weaving operating rates can recover simultaneously. Major weaving clusters like Shengze and Keqiao currently operate at around 60% capacity, with new orders dominated by short runs and urgent orders, insufficient to support a significant rebound in polyester filament prices.

Dual Squeeze from Upstream and Downstream The trajectory of polyester filament prices is not only influenced by its own supply-demand dynamics but also by the dual transmission of upstream PTA and MEG cost fluctuations and downstream weaving and dyeing operating rates. Recent volatility in international oil prices has pressured PX, compressing PTA processing margins to low levels, thus weakening cost support for polyester filament. Simultaneously, the recovery of terminal apparel export orders remains sluggish. According to China Customs data, the growth rate of textile and apparel export values narrowed in the first half of the year, with European and American markets still in the destocking process and limited return of orders from Southeast Asia. Downstream fabric merchants and garment factories generally adopt a 'buy-as-needed' attitude, reluctant to build inventories, which directly suppresses the demand elasticity of polyester filament. For polyester filament mills, the current situation is a dilemma: 'unable to raise prices, unable to lower them.' Continued concessions erode profit margins, while holding firm risks further inventory accumulation. This impasse may persist until mid-to-late Q3, when the traditional peak season orders begin.

Practical Recommendations

For Buyers - Current polyester filament prices are at a cyclical low. Consider moderate stockpiling, but keep single purchases to no more than 15 days of consumption to avoid subsequent price drops. - Prioritize suppliers with sales-to-production ratios below 50%; they have greater bargaining room and may offer more favorable payment terms. - Monitor PTA futures trends. If PTA prices break below previous lows, polyester filament will likely follow, presenting an opportunity to increase procurement.

For Mills (Polyester Filament Producers) - Maintain flexible pricing strategies in the short term, adjusting negotiation room dynamically based on inventory levels, avoiding a one-size-fits-all approach. - Strengthen price-locking agreements with key downstream clients, trading volume for price to ensure a stable sales-to-production ratio above 70% and reduce inventory pressure. - Track loom operating rates in Shengze and Keqiao. If rates rise for two consecutive weeks, consider modest price increases to test market acceptance.