The polyester filament yarn (PFY) sales data on July 13 sounded an alarm for the industry: the average sales-to-production ratio of sample enterprises was only 54%, up 18.5 percentage points from the previous trading day, but still far below the healthy operating threshold of 80%. While a few companies achieved strong sales, with the highest reaching 150%, most struggled in the 15% to 40% range. This structural divergence reveals deep adjustments underway in the chemical fiber supply chain.
Industry Signals from Sales Data
The 54% average ratio means nearly half of the day's output remained unsold. Among the 22 sample enterprises, only three exceeded 100% sales-to-production, another three reached 70% to 90%, and the remaining 16 were below 50%. This 'long-tail inefficiency' pattern is no accident—it reflects downstream fabric mills adopting a 'just-in-time, on-demand' procurement strategy.
Despite the overall weakness, the 18.5-percentage-point rebound from the previous day indicates market resilience. Geopolitical risks have spurred some downstream users to make small essential replenishments, especially as discounts on low-end specifications narrowed, prompting limited transactions. However, whether this rebound is sustainable depends on whether upstream costs can provide effective support.
Balancing Geopolitical Risks and Cost Transmission
The core contradiction in the current chemical fiber market lies in the tug-of-war between geopolitical premiums and weak end-demand. Uncertainty in the Middle East has heightened volatility expectations for crude oil and PX raw materials, but this cost pressure meets a 'wall of ice' in textile and apparel consumption.
Feedback from industrial belts in Shengze, Changxing, and Xiaoshan—major PFY consumption areas—shows weaving mill operating rates hovering at 60-70%, with grey fabric inventories at historical mid-levels. This means downstream factories have neither strong replenishment intentions nor a need for significant production cuts—they are hedging raw material price risks through a 'low inventory + short cycle' procurement model.
For PFY producers, this game is directly reflected in pricing strategies. The narrowing of low-end discounts is merely a tentative move; if sales-to-production ratios remain below 60% for consecutive days, companies will likely reintroduce larger discounts to free up cash. Therefore, the next week's sales data will be a key indicator for determining market bottoms.
Restructuring Supply-Demand Dynamics
From a broader perspective, the current low sales ratio is not merely demand shrinkage but a structural reshaping of supply-demand relationships. On one hand, rapid capacity expansion in PFY over the past two years has increased supply elasticity; on the other hand, terminal apparel exports, affected by global destocking cycles, have shifted to 'small batches, multiple orders, short lead times,' forcing upstream supply chain adjustments.
This change means traditional 'seasonal stockpiling, off-season destocking' rhythms are breaking down. Buyers no longer chase the lowest price but prioritize supplier delivery stability and quality consistency. For chemical fiber companies, relying solely on price wars is no longer viable; they must pivot to differentiated product development and flexible production capabilities.
Industry public data shows that the average operating rate for PFY in the first half of 2024 remained around 85%, but inventory days climbed from 12 at the start of the year to 18 currently. The negative correlation between sales ratio and inventory is becoming more sensitive: once the sales ratio drops below 50%, inventory days could quickly exceed the 20-day warning line, putting significant financial pressure on companies.