According to the commodity market analysis system of SunSirs, the prices of mainstream polyester filament varieties have been weak in the past week, and the transaction center of gravity has not moved up significantly. As of June 9, the POY (150D/48F) of mainstream polyester filament factories in Jiangsu and Zhejiang was quoted at 6900-7200 RMB/ton, polyester DTY (150D/48F low elasticity) was quoted at 8050-8400 RMB/ton, and polyester FDY (150D/96F) was quoted at 7250-7400 RMB/ton.

Cost side: Recently, international oil prices have been supported by geopolitical conflicts (Russia and Ukraine) and summer travel demand. WTI crude oil has remained around US$61/barrel, but the release of PX domestic production capacity has weakened cost transmission, and the polymerization cost is only 5,000 RMB/ton, which has limited support for filament prices. PTA processing fees have been compressed to below 300 RMB/ton, and MEG port inventories are high, so the raw material side has failed to provide the impetus for price increases.

Supply side: The industry's operating rate is about 80%, and the new production capacity of leading enterprises is concentrated in high value-added varieties, and the supply of conventional products is reduced. There are insufficient textile terminal orders, the profit of grey cloth is only 0.01 RMB/meter, and the recovery of loom operating rate is slow. Domestic retail data is flat, and the retail sales of textiles and clothing in January-May increased slightly by 0.8% year-on-year. Policy stimulus (lowering the reserve requirement ratio and interest rate) has not yet been transmitted to the consumer end.

Overall, downstream weaving enterprises purchase mainly small orders for rigid needs, and the average production and sales rate of polyester factories is only 50-70%. Some companies have temporarily boosted production and sales through price cuts and promotions, but the lack of sustainability may continue to cause weak fluctuations in prices, and destocking is still the core task. If demand does not improve, a new round of price cuts and promotions may be ushered in in mid-June.

SunSirs believes that the polyester filament market has been subject to the triple pressure of weak demand + high inventory + poor cost transmission in the past week, and the price rebound has been weak. In the short term, prices may remain in a narrow range of fluctuations, and weak demand and high inventory will suppress the general rise space. In the next 1-2 months, it is necessary to closely track the pace of terminal order recovery and crude oil policy trends.

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