SunSirs: Costs Was Weakening and Demand Was Sluggish, Polyester Staple Fiber Fell Back after Hitting High in June

Price trend

In June, the price of domestic polyester staple fiber showed a trend of falling after a sharp rise. According to the price monitoring of SunSirs, the average domestic spot market price of polyester staple fiber on June 30 was 8,851 RMB/ton, an increase of 3.02% compared with the price at the beginning of the month of 8,592 RMB/ton, and a year-on-year increase of 24.26%. In the futures market, the main staple contract at the end of the month closed at 7,978 RMB/ton, down 5.45% from the beginning of the month.

 Analysis review

The rise in polyester staple fiber prices in June was mainly due to weaker costs and sluggish demand: OPEC+ maintained its original plan to increase production slightly in August, Biden confirmed that he would meet with Saudi leaders, and the prospect of economic growth put pressure on the overall market sentiment. International crude oil futures prices in June fell from high levels. WTI crude oil for June fell 8.03% to settle at 105.99 US dollars a barrel. Dragged down by the fall in oil prices, the prices of PTA and ethylene glycol, the upstream raw materials of staple fiber, fell from high levels. PTA futures and spot prices fell by 5.43% and 1.78% respectively this month. Ethylene glycol futures and spot prices fell by 11.02% and 4.00% respectively this month.

As the temperature rises and the off-season of the industry approaches, the downstream operating rate gradually declines, and the demand and foreign trade decline. It is expected that there will be no improvement in the short term. This month, the maintenance of staple fiber began to increase, the operating rate gradually decreased, and the supply in some areas was insufficient, which caused the spot price to perform better than the futures.

Market outlook

Analysts from SunSirs believe that the current performance of textile terminals is still weak, with high factory inventories and weak demand and exports. The off-season in July will go further. It is expected that the maintenance of staple fiber enterprises will increase, and the operating rate may continue to decline. Under the weak supply and demand, the market outlook of staple fiber may still not be optimistic. Pay attention to changes in raw material prices, adjustments to U.S. tariff policies, epidemics, and the situation in Russia and Ukraine.

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