Polyester Chain Rallies: Staple Fiber Leads with 2.38% Gain, Textile Raw Material Sentiment Shifts

At noon close on July 20, the polyester chain rallied across the board. Staple fiber futures surged 2.38% to 7,478 yuan/ton, PTA rose 2.97%, and bottle chip jumped 3.13%, while cotton and cotton yarn posted only modest gains. This divergence highlights the ongoing tug-of-war between cost-push from upstream and weak downstream demand.

Polyester Chain Strength: Cost Pass-Through Meets Sentiment

The synchronized rise in staple fiber, PTA, and bottle chip is no coincidence. On the cost side, recent crude oil volatility has lifted PX production costs, cascading to PTA and polyester products. PTA, as the direct upstream of staple fiber, rose 2.97%, providing solid cost support. Bottle chip led gains at 3.13%, driven by summer beverage season demand. Notably, open interest in staple fiber futures has expanded, indicating active capital inflows. However, spot transactions in Jiangsu and Zhejiang remain small-lot, suggesting the rally is more expectation-driven than supply-demand tightening.

Cotton Chain Sluggish: Demand Weakness Caps Upside

In contrast, cotton and cotton yarn showed tepid gains. Cotton September contract rose only 0.47% to 15,925 yuan/ton, while cotton yarn edged up 0.04% to 22,315 yuan/ton. This contrast reveals the core contradiction: new-crop production cuts support cotton prices, but downstream yarn and gray fabric inventories remain high, with weaving mills operating below 60% capacity. Cotton yarn’s near-zero gain indicates profit margins have been squeezed to the limit, with some small mills facing immediate losses and resorting to production cuts or switching to blended yarns.

Implications for Buyers and Mills

The widening price gap between staple fiber and cotton yarn will directly influence raw material choices for downstream weaving and garment factories. For mills producing polyester-cotton blends, increasing polyester content is a viable short-term cost-saving measure. However, if polyester chain continues to rise, it may trigger fabric price hikes, dampening overseas orders. In major textile clusters like Shengze and Keqiao, raw material inventories remain low at 7-10 days. A concentrated restocking wave is possible if futures gains persist, but this hinges on real terminal orders.

Practical Recommendations

For Buyers - Staple fiber basis has turned negative (futures premium to spot). Prioritize spot purchases or point pricing; avoid chasing futures. - Cotton yarn prices are stagnant; consider increasing purchases to lock in current low costs. - Monitor PTA-staple fiber spread; if PTA continues to lead, staple fiber may have catch-up potential.

For Exporters - RMB exchange rate has been volatile recently; lock in forward settlement rates for orders over three months. - Update fabric quotations in line with raw material moves, but shorten quote validity to seven days to hedge against price reversals. - Track Southeast Asian yarn prices; if the domestic-import spread widens, consider importing cotton yarn to replace domestic purchases.