Crude Oil Plunges but Polyester Yarn Holds Steady: Who Is Rewriting Textile Raw Material Pricing?

On the morning of August 3, Brent crude October futures plunged 7.3% to $81.55 per barrel, while WTI fell below the $80 mark. However, amid the sharp upstream oil volatility, domestic polyester filament yarn prices remained almost unchanged, with daily fluctuations of only 50-100 yuan per ton. This decoupling between upstream and downstream is becoming the most intriguing signal in the textile raw material market.

Event Background

The immediate driver of this oil price fluctuation is still the repeated US-Iran situation. On July 31, signals of a possible strike on Iranian energy facilities were released, but two days later, claims emerged that an agreement on the Strait of Hormuz had been reached and negotiations were planned. Such reversals have occurred multiple times in the past six months, and while capital markets react genuinely each time, industrial responses are becoming increasingly muted.

For the textile industry, the key point is why polyester filament is no longer closely following crude oil. Since the previous US-Iran conflict, crude has experienced multiple sharp rises and falls, but polyester filament has maintained narrow fluctuations—only slightly rising during upstream surges and even remaining still during upstream crashes. This indicates that the pricing power of polyester filament is shifting from cost-side to supply-demand dynamics.

Industry Impact

Downstream weaving procurement behavior confirms this judgment. Currently in the traditional off-season, weaving machine operating rates are below 50%, and many enterprises lacking stable orders have reduced or halted production. Raw material purchases are basically rigid restocking. Such customers are not sensitive to fluctuations of 50-100 yuan per ton, but if raw material prices swing sharply, even rigid demand purchases may be delayed, further suppressing polyester filament price elasticity.

Notably, the demand side is not without highlights. Due to large-scale production cuts in the weaving sector in the first half of the year, the average fabric inventory at factories has decreased by more than 10 days compared to the same period last year. This means that once downstream demand recovers, existing inventory may not be sufficient to support the first wave of order bursts, potentially causing fabric prices to rise in advance and transmit upward to raw materials.

In terms of timing, the traditional off-season is expected to last for another half month. In the short term, crude oil is unlikely to form a unilateral trend given Trump's repeated statements, and polyester filament will probably continue to fluctuate narrowly. However, if the blockade of the Strait of Hormuz leads to continuously rising transportation costs, coupled with seasonal demand recovery in late August, the raw material market may face a directional choice.

Practical Suggestions

For Buyers - Current polyester filament prices are at relatively low levels with limited fluctuations; rigid demand purchases can proceed normally without excessive waiting for lower prices. - Pay attention to demand signals in late August; if fabric inventory drops rapidly, consider locking in raw material orders in advance to avoid sudden price increases. - For non-rigid demand purchases, consider building positions in batches to hedge against short-term volatility from unexpected oil news.

For Foreign Trade Enterprises - Recent stable raw material prices are favorable for quoting, but it is advisable to include raw material price fluctuation clauses in contracts to guard against potential price increases in late August. - Closely monitor the situation in the Strait of Hormuz; if crude transportation costs continue to rise, it may push up shipping costs, affecting delivery costs and schedules. - Use the current low-inventory window to sign medium-term supply agreements with upstream suppliers to lock in current prices and prepare for second-half orders.