Polyester industrial yarn: the worst PFY variety

Polyester industrial yarn performs the worst among polyester filament yarns. Polyester textile POY and FDY or DTY are near the cost line or manage to have minor profit, and the profit of bright FDY is relatively higher. However, conventional polyester industrial yarn has suffered losses for long time in 2023, and the deficit is serious now, with losses of ordinary high-tenacity 1000D as high as 700yuan/mt.

The operating rate of PIY plants declined in Jun and the processing fee also reduced. In Jul, after the run rate of PIY plants ascended, the processing fee of PIY hit new low again. The lowest processing fee of ordinary high-tenacity 1000D was around 1700yuan/mt, and the losses were around 800yuan/mt. Therefore, when feedstock cost rose in late-Jul, large PIY companies intensively raised price. The trading price of ordinary high-tenacity 1000D increased to 8800-8900yuan/mt from 8500-8600yuan/mt and advanced further to 9000-9100yuan/mt by end-Jul. However, transactions were almost in stagnation after price advanced. After price being firm for around 10 days, PIY plants finally discounted price to promote sales. By mid-Aug, price of ordinary high-tenacity PIY decreased to around 8500-8700yuan/mt. The price of bright PET fiber chip fluctuated little in Aug, only moving down slightly. Therefore, the processing spread of PIY was substantially squeezed.

Operating rate of PIY plants slipped in Jun, rose in early-Jul and changed little in recent one month. Current operating rate of PIY plants is medium, higher than that in Jun but lower than that in Mar-May. Large companies basically ran at full capacity. No companies are heard to scale down production or have turnaround for the time being. That means the operating rate of PIY plants is unlikely to decline, which will be hard to strongly support PIY price.

After the settlement price of PET fiber chip appeared in late-Aug, large PIY companies may raise price again, while transactions may be lacked when PIY market has excessive capacity. The final price is expected to gradually fall to the level acceptable for downstream buyers.