Crude oil has surged past $86, and polyester filament yarn prices have risen for consecutive days. This round of raw material volatility, driven by geopolitics, appears similar to the rally earlier this year, but the underlying logic is fundamentally different. For textile companies, the core question is no longer "will prices rise?" but "who will pay after the rise?"
Inventory Shift: From Destocking to Restocking
Industry data shows that current polyester POY factory inventory stands at 26.4 days, FDY at 32.5 days, and DTY at 37.3 days. Compared to 18.7, 25, and 27.6 days respectively at the start of the year, inventories have increased by nearly 10 days. This indicates growing selling pressure for polyester plants.
Meanwhile, grey fabric inventory has dropped from 24 days to 17 days. Downstream weaving mills have not accumulated stocks but are instead digesting earlier inventories. This "upstream accumulation, downstream depletion" inventory divergence directly reflects weak end-demand — weavers are not unwilling to buy; they simply lack orders.
Demand Gap: Off-Season Meets Changed Sentiment
The price rally earlier this year occurred on the eve of the peak "Golden March and Silver April" season, when textile mills had existing orders to fulfill, making raw material procurement a necessity. Now, the industry is in a traditional off-season with low loom utilization and scarce new orders. Under these conditions, the polyester price hike lacks demand-side support.
A deeper change is in market psychology. After six months of high raw material costs, the industry has become immune to the "price hike—stockpile—further hike" cycle. Earlier this year, many mills withheld inventory expecting higher prices, only to find that passing on costs to grey fabrics and finished textiles was extremely difficult. Negotiations with downstream customers were protracted and often ended in compromise. As a result, the industry now prefers to hold cash rather than inventory, with restocking intentions at a low point.
Geopolitical Double-Edged Sword
Tensions in the Strait of Hormuz have directly pushed up crude oil prices, which then transmit to the polyester chain. However, the impact depends on duration. A brief blockade would have limited effects; a prolonged standoff could trigger global energy supply chain disruptions.
Notably, many countries hold low crude oil inventories with slow replenishment, reducing their resilience to shocks. If the blockade persists, it could accelerate order shifts to China while also suppressing overseas consumer demand, potentially fueling global inflation and triggering financial risks. The probability of black swan events is rising.
Market Polarization: Cost-Push vs. Demand-Pull Disconnect
The current polyester price hike is primarily cost-driven, not demand-driven. This fundamentally differs from the demand-led rally earlier this year. Cost-push price increases are often unsustainable because downstream lacks the willingness and ability to absorb them.
Polyester plants face a dilemma: further price hikes may suppress downstream buying and worsen inventory buildup; price cuts would compress margins. Weaving mills are even more passive — raw material costs rise while fabric prices struggle to follow, squeezing profits from both sides. Market polarization will intensify: companies with orders and pricing power can partially pass on costs, while most small and medium enterprises can only bear the pressure.