Polyester filament losses widen, raising concerns about further production cuts

Over the weekend, some large polyester filament factories intensified their promotional discounts, with discounts reaching up to 800yuan/mt. For example, the transaction price of POY150D/48F dropped to 7250yuan/mt, close to last year's lowest price level of 7200yuan/mt. Based on last Friday's prices, the POY150D on average was already losing nearly 200yuan/mt, and with the increased weekend discounts, the loss expanded to nearly 300yuan/mt, reaching the lowest point in profitability this year.

Meanwhile, since May, downstream mainly purchased on essential demand, leading to a decrease in overall raw material stocking. As of last Thursday, downstream stocking were mostly towards late-month, indicating a new round of procurement. Stimulated by the sales promotions, weekend polyester filament sales in Jiangsu and Zhejiang partially increased, estimated to be around 130-140% on average over two days. Several factories in Jiangsu and Zhejiang had sales ratio averaging at 230%, 0%, 55%, 0%, 0%, 0%, 45%, 40%, 70%, 85%, 30%, 40%, 40%, 40%, 50%, 50%, 20%, 200%, and 70%.

Since March, polyester filament enterprises have continuously promoted sales, leading to multiple refreshes of the year's lowest prices and declining profitability. Currently, filament prices have fallen to the lowest point of the year, particularly POY.

Since the May Day holiday, downstream textile mills' order intake has generally weakened, with seasonal declines in operating rates. Future attention is needed on the implementation of the leading filament enterprises' 10% production reduction plan and whether some small and medium-sized enterprises will also follow suit.