On July 10, 2026, chemical fiber market data sounded an alarm for the industry: the average sales-to-production ratio of polyester filament yarn sample enterprises fell sharply by 4.9 percentage points from the previous trading day to just 35.5%. This figure is not only below the 50% threshold needed for stable operations but also directly reflects a sharp contraction in downstream demand.
Background
Looking at specific sales data, the ratios were highly dispersed, ranging from a low of 0% to a high of 70%, with most concentrated in the low range of 20% to 35%. For example, multiple sample points recorded ratios of 20%, 30%, and 35%, while some enterprises achieved zero sales. This "polarized" pattern actually reveals extreme divergence in downstream procurement behavior—a few companies may have acted due to special orders or price negotiations, but the overall market has fallen into a stalemate.
Industry public data shows that after a round of concentrated replenishment last week, downstream users quickly retreated to a wait-and-see stance. This "replenish and retreat" rhythm is not uncommon in the off-season, but the speed and magnitude of this retreat exceeded expectations. Typically, a ratio below 40% means factory inventories begin to accumulate passively, and if it persists for several days, it may trigger production cuts or price promotions.
Industry Impact
The direct consequence of the plummeting sales ratio is that inventory pressure shifts upstream. Polyester filament yarn producers will see both raw material and finished product inventories rise simultaneously, tying up capital and squeezing profit margins. On the cost side, upstream raw materials like PTA and MEG have been relatively stable recently, but if downstream demand remains weak, chemical fiber plants may be forced to cut prices, sparking a new round of price wars.
What does this signal mean for textile industry clusters? Taking major polyester filament yarn producing areas such as Shaoxing, Xiaoshan, and Shengze as examples, local weaving mill operating rates were already under pressure in the traditional off-season of July. With raw material purchasing intentions further weakening, operating rates are expected to drop by 5-10 percentage points month-on-month. End-market orders for apparel and home textiles show no signs of recovery, with brands and traders generally adopting a "produce on demand" strategy, amplifying inventory risks in the intermediate links.
Additionally, the foreign trade sector faces challenges. RMB exchange rate fluctuations, inflationary pressures in major overseas markets, and geopolitical uncertainties are all suppressing restocking demand from overseas buyers. In the first half of 2026, China's chemical fiber export growth slowed from double digits to single digits, and July data may worsen further.
Practical Recommendations
For Buyers - Avoid blindly stocking up at current levels; prioritize consuming existing inventories and wait for the sales ratio to recover above 40% before considering additional purchases. - Monitor factory inventory days and production cut plans; if major suppliers announce maintenance or capacity reductions, it could be a leading indicator of price bottoming. - Sign short-term, small-volume orders with upstream suppliers to avoid inventory devaluation losses from rapid price declines.
For Foreign Trade Firms - Closely track port inventories and end-consumption data in major export destinations to avoid order cancellations due to sudden overseas demand drops. - Use futures or forward exchange hedging tools to manage RMB exchange rate risks, especially amid uncertain Fed policy expectations. - Actively communicate with downstream brands to shorten order cycles to 2-3 weeks, adapting to rapid market changes.
Overall, the 35.5% sales-to-production ratio is not an isolated event but a clear signal that the chemical fiber industry has entered an off-season adjustment phase. All parties in the supply chain must remain cautious, prioritize liquidity management, and wait for the turning point of demand recovery.