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 figure is far below the healthy level (usually above 80%), meaning only about 30% of the day's output was absorbed by the market, with the rest turning into inventory. Downstream users showed strong resistance to current prices, inquiries were sluggish, and overall sales were flat. When the ratio stays below 50% for an extended period, price wars often become a matter of time.
Signals Behind the Data
The specific data shows extreme divergence: individual enterprise ratios ranged from 0% to 340%, with most concentrated in the 20%-40% range, but an outlier at 340% appeared. This divergence indicates that the market is not entirely shrinking; rather, structural opportunities exist—some differentiated products or low-priced sources still attract concentrated purchases, while conventional specifications are ignored. For buyers, this means negotiation space is opening up, but they need to accurately identify which suppliers are truly under pressure.
The decline in the ratio is a direct result of price negotiation. Upstream raw material costs remain high, making filament plants reluctant to cut prices; downstream weaving enterprises, facing insufficient terminal orders, have weak willingness to purchase expensive raw materials. This "squeezed from both ends" pattern is particularly prominent in the August off-season, as terminal orders for apparel and home textiles have not yet started, and weavers mostly maintain just-in-time replenishment, lacking motivation to stockpile.
From an inventory cycle perspective, consecutive low ratios will push up factory inventory days. If the ratio remains around 30% for another week, some plants may be forced to cut production or promote sales with discounts. Historical experience shows that when the ratio stays below 40% for more than five trading days, market quotes often drop by 200-300 yuan per ton. Therefore, the current data can be seen as a precursor to price adjustments, not an isolated fluctuation.
Upstream-Downstream Transmission and Regional Reactions
In major polyester filament distribution centers like Shengze and Changxing, traders maintained stable morning quotes, but by afternoon some specifications began to show price concessions of 50-100 yuan per ton. Weaving enterprises generally adopted a "buy as needed" strategy, keeping raw material inventory at 3-5 days of usage, far below the usual 7-10 days. This cautious attitude directly reflects in the sales-to-production ratio and exacerbates the wait-and-see atmosphere.
For upstream PTA and MEG, weak filament sales will suppress their price rebound potential. Although cost-side support remains, negative feedback from demand may force polyester plants to cut production, thereby reducing raw material purchases. Profit distribution along the chain will be reallocated, with concessions in the filament segment possibly transferring upstream, but this is hard to achieve in the short term.
The foreign trade sector is also under pressure. Overseas orders are typically in a lull in August, coupled with fluctuating shipping costs and exchange rate uncertainty, prompting exporters to prefer short-term contracts to avoid risks from raw material price volatility. The low sales-to-production ratio means foreign trade companies can gain more bargaining power, but they should be wary of suppliers lowering quality standards due to inventory pressure.
Practical Recommendations
For Buyers - Increase inquiry frequency, focusing on suppliers with ratios below 20%, as they are more willing to cut prices; try to negotiate credit terms. - Adopt a batch purchasing strategy, splitting single orders into 2-3 batches with 3-5 day intervals to respond to possible price drops. - Be cautious with abnormal sources like the 340% ratio; verify quality and batch stability to avoid hidden costs from low prices.
For Foreign Trade Enterprises - Include price adjustment clauses in export contracts, allowing renegotiation when raw material prices fluctuate by more than 3%, to mitigate inventory depreciation risks. - Use the current buyer's market window to sign short-term framework agreements with suppliers, locking in favorable prices while requiring quality commitments. - Monitor RMB exchange rate and shipping cost changes; if RMB depreciates or freight drops, consider increasing purchases moderately to lower overall costs.
In summary, the polyester filament market is caught in a cycle of "price standoff, weak demand, and rising inventory," with the sales-to-production ratio being a key indicator for turning points. In the coming week, if the ratio remains sluggish, downward price pressure will accelerate. Industry participants should stay flexible to avoid passive inventory losses in the game.