Polyester Filament Sales-to-Production Ratio Falls Below 30%, Inventory Pressure Concentrates in Midstream

On August 4, the average sales-to-production ratio of sampled polyester filament enterprises stood at 30.9%, down 2.7 percentage points from the previous trading day. This means that for every 100 tons of filament produced, only about 31 tons were absorbed by the market—inventory is visibly piling up at polyester plants. Downstream buyers' resistance is not groundless: with raw material prices remaining high and terminal orders not yet picking up in tandem, weaving mills are choosing to reduce purchases and lower operating rates, forcing upstream suppliers to concede.

Background

The sales-to-production ratio is a core leading indicator of supply-demand dynamics in the chemical fiber industry. The 30.9% figure has remained below the threshold for several consecutive days, and the data on that day varied widely from 0% to 340% across sample enterprises. A few companies may have recorded high ratios due to deliveries of earlier orders, but most hovered between 20% and 40%, with some even at zero, indicating that the market is not completely dormant but rather fragmented and lacking sustained demand.

From a value chain perspective, polyester filament sits between the polyester chip segment and the weaving segment. Upstream PTA and MEG prices are influenced by crude oil fluctuations, providing some cost support; downstream water-jet looms and warp knitting machines are constrained by terminal apparel and home textile orders. Currently, the domestic market has not yet entered the peak season, while foreign trade orders are affected by shipping and exchange rate volatility. This tug-of-war leaves filament prices in a dilemma.

Industry Impact

For polyester plants, persistently low sales-to-production ratios directly increase finished goods inventory days. If the ratio fails to recover above 50%, plants may be forced to cut prices to stimulate sales, putting downward pressure on filament prices and further squeezing profit margins. For weaving mills, lower raw material prices may signal an approaching procurement window, but only if their own orders can support inventory replenishment—otherwise, cheap raw materials will only exacerbate the risk of finished goods inventory depreciation.

It is worth noting that the divergence in sales-to-production ratios also reveals structural opportunities. Enterprises that have focused on differentiated products (such as cationic, recycled, and functional filaments) have clearly outperformed those producing conventional grades. This signal suggests that relying solely on scale competition in conventional POY, FDY, and DTY is no longer sustainable; product structure upgrading is the key to navigating the cycle.

Practical Recommendations

For Buyers - Purchase on a need-to-order basis in the short term, avoid hoarding raw materials during price standoffs, watch for price cut signals from polyester plants, and consider batch replenishment when the sales-to-production ratio remains below 40% for three consecutive days. - Prioritize securing supply of differentiated products and sign quarterly framework agreements with upstream suppliers to trade volume for price, reducing spot market volatility risk.

For Foreign Trade Enterprises - Closely monitor RMB exchange rate fluctuations, build in exchange rate buffers in quotations, or use hedging tools to manage settlement risk. - Track the pace of destocking in overseas end markets; if retail data in Europe and the US shows signs of recovery, move early to place orders for autumn/winter fabrics, leveraging current low raw material costs to lock in margins.