With geopolitical tensions in the Middle East easing and crude oil prices weakening significantly, the price of polyester staple fiber has declined due to a lack of cost support. According to the SunSirs commodity market analysis system, as of June 17, the domestic market average price for polyester staple fiber (1.4D*38mm) stood at 7,707 RMB/ton, down 1.51% from June 15.
The crude oil market has experienced a significant downturn over the past two days, with the prices of the two major benchmark crude oil futures contracts plunging in tandem. As of June 16, international crude oil futures saw a sharp decline. The settlement price for the U.S. WTI crude oil futures contract for July delivery fell by $4.70 (5.8%) to $76.05 per barrel, while the settlement price for the Brent crude oil futures contract for August delivery dropped by $4.21 (5.0%) to $78.96 per barrel—both hitting three-month lows. The primary driver was a tangible easing of geopolitical tensions between the U.S. and Iran; the signing of a memorandum of understanding and expectations for the resumption of shipping through the Strait of Hormuz caused the risk premium that had been supporting oil prices to evaporate rapidly. However, regarding market fundamentals, this short-term pullback does not signal a complete resolution of the energy supply crisis; the medium- to long-term trajectory of oil prices remains subject to complex dynamics and uncertainty.
The PTA market tracked the decline in crude oil prices; as of June 17, the spot price of PTA in East China stood at 6,058 RMB/ton, following a 6.41% drop on June 15. Regarding supply, PTA operating rates have fluctuated upward to around 68%, leading to a slight increase in market supply. Specifically, Formosa Chemicals & Fibre Corporation (FCFC) restarted a 1.5-million-tonne unit on June 10, while another 1.2-million-tonne unit is scheduled for subsequent maintenance; Yisheng Hainan's 2.5-million-tonne unit has been shut down since June 4. Dushan Energy restarted one 2.5-million-tonne PTA unit, while another 3-million-tonne unit is operating at 50% capacity and is slated for a future shutdown; Shandong Weilian plans to shut down its 2-million-tonne PX unit and 2.5-million-tonne PTA unit for 45 days of maintenance starting June 25. With the restart of some units previously under maintenance, the pace of PTA inventory reduction narrowed in June, though destocking is expected to continue in July.
On the demand side, the sharp drop in crude oil prices has significantly lowered costs; with limited follow-through in demand, downstream yarn mills have slightly reduced their prices. There are signs of improvement in both procurement and sales within the weaving sector, with the operating rates of texturing and weaving machines in the Jiangsu-Zhejiang region rising for two consecutive weeks. Although end-market demand remains sluggish, raw material inventories at weaving enterprises are at historical lows, creating expectations for restocking. However, foreign trade orders remain weak, and the outlook for textile and apparel exports to Europe and the United States is lackluster. Consequently, a wait-and-see sentiment prevails, making it unlikely that sustained procurement will drive the market.
Analysts at SunSirs believe that, with the center of gravity for costs continuing to shift downward in the short term and demand remaining primarily driven by rigid needs, the price of polyester staple fiber is expected to undergo a fluctuating downward adjustment.
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