SunSirs: Both Cost and Demand Were Weak, and the Price of Polyester Staple Fiber Remained Downward

Price trend

According to the Commodity Market Analysis System of SunSirs, the price of polyester staple fiber slightly decreased in July. As of July 21, the average market price of domestic polyester staple fiber (1.4D * 38mm) was 6,610 RMB/ton, a decrease of 1.85% from the beginning of the month.

Analysis review

The crude oil market was mainly volatile, with the settlement price of the September WTI crude oil futures contract in the United States at $66.05 per barrel as of the 18th, and the settlement price of the September Brent crude oil futures contract at $69.28 per barrel. The crude oil market was affected by both bullish and bearish factors. On the one hand, OPEC+ released its annual world oil outlook and lowered its energy demand expectations, putting pressure on oil prices. On the other hand, the geopolitical situation in the Middle East had led to increased sanctions against Russia by the United States, and the United States will impose a 30% tariff on most imported goods from the European Union and Mexico from August 1st, causing fluctuations in the crude oil market.

The PTA market went out of stock from March to June, and in July, maintenance facilities resumed production one after another, increasing the supply margin. The market lacked unplanned news guidance. In addition, with the start of trial production of 3.2 million tons of PTA new capacity in East China, the supply had increased, and the current operating rate of the PTA industry was around 80%.

July was temporarily in the off-season for textile production, with poor downstream purchasing enthusiasm and a sluggish yarn market. Some factories reduced their order volume, resulting in insufficient order follow-up. Purchasing was cautious, with a focus on essential needs. Terminal demand continued to be sluggish, and fabric inventory continued to accumulate, forcing factories to alleviate capital turnover pressure by reducing production. Coupled with a decrease in foreign trade orders, most of them focused on digesting inventory.

Future outlook:

SunSirs’ analysts believe that some polyester staple fiber factories reduced production and underwent more maintenance in July, and it is expected that industry supply will decline. However, the overall weak performance of raw materials and weak demand dragged down market sentiment, which will further suppress the price of polyester staple fibers.

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