Direct-spun PSF market in Dec: prices at low level and inventory reduces

In December, the price of direct-spun PSF continuously hits new lows for the year, once dropping to the 7,000yuan/mt.

In mid-month, the rebound in crude oil prices and the booming sales of PFY drove PTA prices higher, and PSF futures market followed to rebound. Downstream spinning mills had low raw material inventory, and had a round of intensive replenishment in mid-month, which caused the inventory of PSF to quickly decline to a low level in the year.

During this round of destocking, plants continued to adopt a strategy of lowering prices for sales; the increase in spot prices was less than that of futures, leading to a rapid weakening of the basis, causing traders to lose their price advantage and orders to shift towards plants.

Currently, downstream yarn factories have raw material inventory mostly in the range of 10-15 days, with insufficient willingness to continue chasing higher prices for raw materials. Furthermore, as January approaches, more spinning mills cut production or suspend operation. Thus the market again stands on the sidelines.

In the future, attention will be focused on the production reduction/shutdown plans of direct-spun PSF plants for the 2025 Spring Festival; currently, only a small number of plants have plans for the holiday, while most have yet to release any information.