SunSirs: Polyester Industry Chain Shows Early Signs of Recovery

Following the Spring Festival holiday, China's chemical market has exhibited significant divergence driven by both geopolitical tensions and varying fundamentals, presenting a critical window of opportunity for the chemical sector. On February 25, during the Futures Daily's “Market Outlook” live broadcast, it was noted that amid uncertainties in the crude oil market, significant divergence has emerged within China's chemical sector. Polyester-related products have begun exhibiting cyclical upturn characteristics, while methanol and PVC face substantial supply-demand pressures.

Regarding crude oil, the primary feedstock for chemicals, its actual impact primarily sets the overall tone for the chemical market rather than dictating the strength or weakness of individual products. The core determining factor remains the supply-demand fundamentals of each specific product.

Currently, severe divergence exists within the chemical sector—polyester chain products are favored, while methanol and PVC face pressure. Polyester chain emerges as the dominant trend, underpinned by a pivotal shift in the industry's capacity cycle and substantive improvements in supply-demand dynamics. As the core product of the polyester chain, the PTA sector concludes its seven-year capacity cycle. With no new domestic PTA facilities scheduled for commissioning in 2026, capacity expansion enters a “lull period.” Meanwhile, the downstream polyester industry plans to add 5.16 million tons of new capacity annually. Expansion in segments like polyester filament yarn, PET bottle flakes, and staple fiber will drive sustained demand growth for PTA, shifting the industry's supply-demand dynamics from ample to tight.

Inventory and operating rate data indicate that as of February 13, China's PTA capacity utilization rate stood at just 74.22%, a four-year low, with tight supply underpinning prices. Pre-holiday PTA prices staged a recovery rebound, expanding processing margins above RMB 400/ton and significantly boosting industry profitability.

In stark contrast to the polyester chain's strength, PVC, methanol, soda ash, and glass face dual pressures from high inventories and weak demand, making them the weakest segments in the post-holiday chemical market. China's methanol sector not only relies heavily on Iranian imports but also grapples with high inventory pressures, making its future trajectory highly dependent on geopolitical developments. PVC is weighed down by sluggish downstream demand from the real estate sector, with inventories at historic highs. Although deep industry losses fuel expectations of production cuts, the weak pattern is unlikely to change in the short term. Its trajectory will likely mirror glass, exhibiting “low-level fluctuations with pulse-like rebounds.” Additionally, while urea benefits from peak agricultural demand, it remains influenced by price guidance policies.

Historical data reveals short-term risks in the polyester chain: markets often trade ahead of peak season expectations during off-peak periods. Yet when the actual “Golden March and Silver April” peak season arrives, prices frequently plummet across the board due to expectations being met or demand falling short. Over the past decade, March has seen a high probability of price declines for commodities like PTA.

Whether PTA prices can sustain their upward momentum hinges on whether post-holiday terminal demand (textiles, apparel) can effectively absorb upstream raw material cost increases. Current terminal data is not encouraging. If downstream production resumption over the next two to three weeks lags behind historical patterns, it could trigger negative feedback for PTA prices.

Regarding near-term investment strategies in the chemical market, maintain caution on weak commodities like PVC and methanol. If participating, consider hedging transactions to mitigate risk. Closely monitor core data such as terminal operating rates and downstream order volumes over the next 2-3 weeks to navigate market rhythms during this demand validation period.

Overall, the chemical industry in 2026 is at a critical juncture of supply structure optimization and demand transformation. The “anti-involution” trend is driving the elimination of outdated capacity, with fixed asset investment growth turning negative. The rise of emerging sectors like semiconductor materials, new energy materials, and robotics materials is opening up long-term growth prospects for the industry.

As an integrated internet platform providing benchmark prices, on February 27, the benchmark price of PTA from SunSirs was 5270.64 RMB/ton, a decrease of 0.53% compared with the beginning of the month (5298.83 RMB/ton).

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