How about the performance of textile market at the end of year?

In the fourth quarter, downstream demand has significantly underperformed compared to last year. After a brief recovery during the traditional peak season in October, downstream demand began to show a gradual downward trend. Some customers mentioned that this year's peak season lasted only a short time, with business picking up for just over 20 days before cooling off. Others felt that there was hardly any peak season in the second half of the year.

Demand was worse than anticipated in the fourth quarter. The inventory of chemical fiber plants, DTY producers and fabric mills reduced slowly and was apparently than the same period of last year, but the feedstock remained low as players lacked confidence. The inventory of grey fabrics has been higher than the corresponding period of past years. The operating rate of downstream plants may be lower than the first half of this year in the first half of 2025.

Upstream feedstock prices rapidly rose for a short period in early-October and then started falling. Price of PFY was lower than the early-low in end-September by end-November. The downstream sector generally feels that polyester filament yarn prices are currently at a historically low level, but there are some differences in their willingness to stock up for the upcoming New Year. Some business owners in the downstream industry express a desire to stock up on more goods before the holiday or believe that maintaining a reasonable level of finished product inventory is not a big issue. Some hold cautious mindset in the market status next year, especially regarding the trend of oil prices and the uncertainty about the escalation of the trade war brought about by Trump after taking office. Some feel that the potential returns from stocking up on raw materials are small and are reluctant to accumulate inventory, preferring to wait and see after the holiday.

The replenishment of downstream plants at the end of year will be related with the turnaround of chemical fiber plants during the Spring Festival holiday. Downstream factories think large chemical fiber companies will have turnaround during the Spring Festival holiday but the strength will not be too large. Downstream buyers need to restock before the Spring Festival holiday (normal replenishment for 15 days of production by convention and some will restock for 20-30 days of production if they are optimistic about the trend after Spring Festival holiday). Chemical fiber plants may not face too big inventory burden before holiday while downstream plants will shut down for holiday. As a result, the inventory pressure will be incarnated in chemical fiber plants after holiday, especially when the turnaround during the Spring Festival holiday is limited.

At the end of this year, downstream operating rate has entered a downward channel early, with average run rate lower than the same period of last year. The Spring Festival holiday schedule of this year may be earlier than last year on downstream sector. Some downstream factories with bad business may shut down for holiday after December 20 while most want to insist on production until after the New Year's Day holiday or early-Jan, mainly factoring into the recruitment of workers for the next year and low feedstock price. The actual implementation will depend on the status in December. If the business is really bad, the holiday will be ahead of schedule. Most downstream plants will suspend production for holiday for near one month and most will restart operation after twelfth day of the first month while non-local workers will come back to work after the Lantern Festival holiday.