The Strait of Hormuz has been re-blockaded after a brief reopening, sending crude oil prices soaring and triggering a new round of polyester filament price hikes. Daily increases of 50 to 100 yuan per ton have been observed, but weaving mills are far more composed than during the post-CNY surge. This contrast reflects both the industry's improved ability to absorb supply-side shocks and growing concerns about demand-side weakness.
Price Hikes: Milder Pace, Cautious Response
The current price adjustment is significantly milder than the post-CNY wave, which saw daily jumps of 500 yuan and cumulative increases of 1,000 yuan in two days. Mills are now adopting a wait-and-see approach, with little enthusiasm for restocking. This is not due to indifference to rising costs, but to a cautious outlook on demand. End-use fabric orders have not surged, and grey fabric inventories remain at medium-to-high levels. With no strong demand backing, the industry chain is entering a period of price negotiation.
Strait Closure: Limited Refill Window, Persistent Gap
The real story lies in the structural impact on global energy supply. During the first blockade, multiple countries faced naphtha shortages—Japan even switched to monochrome packaging to save ink, and some Southeast Asian nations reduced working hours and rationed fuel at gas stations.
After the US-Iran MOU, the strait reopened, but traffic remained far below normal. From June 18 to July 5, only 28 ships passed daily, compared to 130-138 before the conflict. In the five days after the agreement, about 18 million barrels of crude were shipped from Iran, which claimed exports of 40 million barrels at a 20% premium. The US military escorted over 800 vessels, moving about 400 million barrels. Yet the IMO stated on July 8 that hundreds of ships and about 6,000 seafarers remain stranded in the Persian Gulf. Asian countries replenished some stocks during the window, but not enough to fill the previous deficit. The new blockade will further tighten global supply.
Short-Term Gains, Long-Term Risks for China's Textile Industry
In the short term, the energy crisis is shifting global textile orders to China. Southeast Asian producers, heavily reliant on Middle Eastern energy, are struggling with production disruptions. China, with its coal-chemical and renewable energy infrastructure, enjoys a more stable supply. Customs data from July 14 shows June textile and apparel exports grew 7.2% YoY and 14.3% MoM; textile exports alone rose 12.2% YoY and 7.4% MoM. First-half cumulative exports reached $145.96 billion, up 1.4% YoY.
But long-term risks loom. Global inflation, the US debt crisis, and the AI bubble have left the world economy fragile. If the strait closure drives oil prices higher, US inflationary pressure could force the Fed to raise rates again, triggering a global liquidity crisis. China's textile industry relies heavily on exports; if the global economy falters, even China's vast capacity cannot remain immune.