SunSirs: After a Slight Rebound Last Week, Polyester Filament Prices Continued to Weaken, with the Price Center Shifting Downward

Overall trend last week: a slight rebound early in the week, followed by continued weakness in the latter half, resulting in a downward shift in the overall price level.

During the week of June 22-26, 2026, the polyester filament market initially saw a slight rebound but subsequently weakened continuously, with price levels shifting downward. This trend was driven by falling costs—spurred by significant declines in upstream PTA and crude oil prices—compounded by the downstream weaving sector's off-season, which resulted in insufficient essential demand and sluggish sales; consequently, the market focused on clearing inventory through price concessions. Mainstream 150D specifications recorded notable weekly drops: POY fell from 8,250-8,350 RMB/ton at the start of the week to 8,150-8,300 RMB/ton by Friday (a decrease of 100-150 RMB/ton); FDY retreated from 8,800-8,950 RMB/ton to 8,400-8,600 RMB/ton (down 350-400 RMB/ton); and DTY slid from 9,450-9,600 RMB/ton to 9,150-9,350 RMB/ton (down 300-350 RMB/ton). Among these, DTY demonstrated the greatest price resilience due to processing fee margins, while POY saw the sharpest decline. By Friday, as the downward trend in raw material prices slowed, filament manufacturers showed a greater willingness to hold firm on prices, leading the market into a "wait-and-see" phase characterized by a standoff at low price levels and sluggish trading activity.

Key driving factors

(I) Upstream Costs: Sharp declines across the board were the primary driver of last week's drop.

Crude Oil & PX: As geopolitical tensions in the Middle East eased, the geopolitical risk premium evaporated rapidly; PX prices plunged by over $120/tonne during the week, pushing the cost baseline for polyester raw materials steadily lower.

PTA (The biggest drag)

Spot prices started the week at 6,035 RMB/ton but plummeted 4.18% in a single day on June 25 to 5,718 RMB/ton, resulting in a total weekly decline of over 300 RMB/ton. Factors weighing on the market included a slight rise in PTA plant operating rates, sluggish downstream polyester production and sales, and weakening supply-demand fundamentals; the continued narrowing of the basis spread directly suppressed the price floor for filament yarn.

Monoethylene Glycol (MEG)

Prices weakened in tandem, with Zhangjiagang spot prices hovering around 4,360 RMB/ton. Although port inventories remained below 700,000 tonnes, high operating rates for coal-based MEG production and declining polyester plant loads kept prices weak in sympathy with PTA; polymerization costs continued to drift downward, forcing a compression of filament processing margins.

(II) Supply Side: Continued operating rate cuts for filament ease inventory pressure but fail to offset the impact of the off-season.

Low operating rates: The average operating rate for domestic direct-spun filament stands at 71%-73%. Leading enterprises have proactively reduced operating rates and scheduled maintenance, marking a drop of over 10 percentage points from the May peak as coordinated industry-wide production cuts take effect. Inventory trends show mixed improvement.

POY inventory levels range from 19 to 23 days, showing a significant month-on-month decline; FDY inventory is around 27 days; and DTY inventory remains highest at 34-36 days (reflecting slower turnover in the texturing stage). Factories are prioritizing low-price sales and inventory reduction over large-scale production shutdowns, leading to softer price quotes and increased price concessions on actual orders.

Sluggish production and sales data: Last week, the industry's average production-to-sales ratio was only 50%-70%. While sales briefly exceeded 100% on Monday due to essential restocking, they remained below 70% for the rest of the week; there was no concentrated restocking activity, and the pace of inventory depletion at factories remained slow.

(III) Downstream Demand: Traditional Off-Season with Persistent Negative Feedback from End Markets

Weaving operating rates have rebounded slightly from low levels: Loom operating rates in the Jiangsu-Zhejiang region rose marginally to the 53%-57% range, though they remain at year-to-date lows. Printing and dyeing operating rates hover at only around 50%, with a scarcity of orders for summer home textiles and apparel, alongside sluggish export inquiries. Stocking activity is extremely cautious: raw material inventories for weaving mills cover only 7-10 days of production, with purchasing strictly on an as-needed basis to avoid advance stockpiling; inventories of greige and finished fabrics stand at 18 days, while order backlogs cover less than 9 days. Sluggish fabric sales are hindering the transmission of procurement demand upstream. Seasonal weakness persists: June marks the traditional off-season for the textile industry, and with expectations of high-temperature power restrictions and a lull in orders during July and August, downstream purchasing sentiment remains weak, making it difficult to generate sustained bullish momentum.

(IV) Market Sentiment: From Panic to Cautious Wait-and-See

A sharp drop in PTA prices mid-week triggered market panic, leading weavers to generally halt purchasing in anticipation of lower prices. By Friday, the downward trend in raw material prices had slowed and manufacturers showed a renewed resolve to support prices; however, downstream buying interest failed to materialize. This resulted in a stalemate—with upstream players seeking stability and downstream buyers waiting for better levels—leading to reduced trading volumes.

Differentiation Logic by Product Type

POY (Sharpest Decline): Standardized product with high liquidity and ample trader inventories; it exhibits the strongest cost correlation—prices drop rapidly as raw material costs fall—and shows the highest price elasticity. It is primarily used for low-end greige fabrics with thin profit margins, making it highly sensitive to raw material price reductions.

FDY (Moderate Decline): Primarily used for imitation silk and high-end fabrics; downstream orders are slightly better than those for POY. However, due to concentrated capacity expansion and high inventory levels, prices are adjusted downward in tandem with raw material costs.

DTY (Most Resilient to Price Drops): High value-added due to the texturing process, where processing fees act as a buffer against falling raw material costs. Orders for specialized DTY (such as high-elasticity or interlaced varieties) remain stable, and manufacturers show a stronger inclination to cut production; consequently, price reductions are significantly smaller compared to POY and FDY.

Short-term outlook for the market (Week of June 29 - July 3)

Cost side: Crude oil and PX lack fresh bullish drivers; PTA and MEG prices are likely to remain range-bound with a weak bias. There is still room for costs to drift lower, making a rapid rebound unlikely. Supply side: Filament producers are maintaining low operating rates; if inventories build up again, maintenance activity may increase, providing a degree of price support. Demand side: The off-season persists; high temperatures combined with a lull in orders mean large-scale restocking by weavers is unlikely, with purchasing limited to sporadic, essential needs. Price outlook: Overall, prices will likely fluctuate at low levels with a weak bias, stabilizing after a probable slight decline. POY still has room to fall by 50-100 RMB/ton, while DTY shows greater price resilience. Factory quotes will aim for stability, though discounts on actual orders will persist, and a sharp price surge is unlikely in the short term.

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