In The First Half Of 2019, The Direct Spinning Polyester Staple Market Was In A 2 Market Trend. The Price Was "Deep V".

The global trade situation is complex and changeable, and private refinery has been put into operation. In the first half of 2019, the market of direct spun polyester staple fiber fluctuated. Especially in the 2 quarter, the market price showed a "deep V" trend. Moreover, due to the offset of the supply and demand pattern of the industry, the profitability of the industry began to shrink gradually. In the second half of the year, the industry's new production capacity is still running, and the contradiction between supply and demand is becoming more and more prominent. With the increasing competition pattern, the phenomenon of concentrated production of polyester staple fiber industry in the future will be highlighted gradually.

Market Review

In the first half of 2019, the average price of domestic direct spinning polyester staple industry was 8441 yuan / ton, down 13.7%, down 4.88% from the same period last year. In addition to the changes in supply and demand side, the main reason for the decline in prices is the intensification of Global trade disputes and the cost reduction caused by large-scale private refinery operations.


Specifically, in the 1 quarter, the market of polyester staple fiber is relatively slow. But since March, the price of PX has been falling all the way, despite the fact that the Hengli refinery project has been put into operation smoothly. Although PTA has been relatively resistant to the tight supply, it has been affected by the news of the surrender tax. Some buyers in the middle and the end of 3 have made stock in advance, resulting in a certain overdraft of the market. So after entering the April, despite the frequent failure of device failures and a small rise, but eventually the price of PX continued to fall, the market began to enter a long way down. During this period, the profits of the PX industry did not flow smoothly to the downstream. The price of the PTA link was very strong under the tight supply and the big factory continued repurchase spot, which led to the huge expansion of the industry processing fees. Meanwhile, the profitability of polyester staple production enterprises began to squeeze significantly. By May, under the pressure of sharp shrinkage in profits and high storage pressure, some short fiber enterprises began to stop or overhaul production.

Affected by the reduction in production of chemical fiber plants, the market began to slow down gradually. The long decline and the bad news of the periphery made the middlemen and the downstream businesses hesitate to make a move, and the raw materials inventory in the downstream sectors dropped to a very low level. And entering the June, influenced by the favorable expectation of trade talks and the oil rising caused by the tension between the US and Iraq, the middlemen and downstream enterprises thought that the market outlook had dropped to the point where they could not fall, so the procurement began to be stocked up, and the stock of polyester staple fiber enterprises was rapidly digested. In June, the market price rose by 1100 yuan / ton.

Two, profit analysis

In 1-6 months, the average profit of the domestic direct spinning polyester staple industry was 345.92 yuan / ton, an increase of 40.97% over the same period, down 27.58% from the same period last year. In the first half of 2019, the average profit of the industry was still good. However, the commissioning of private large-scale refinery projects failed to bring PX profits to the downstream. Instead, because of the tight supply of PTA, its profits continued to be high. At the end of the 2 quarter, the polyester staple industry profits were squeezed to a very low level. The average profit of the whole industry in June was only 54.54 yuan / ton.


Specifically, in the 1 quarter, the polyester staple fiber industry made a good overall profit. But in the 2 quarter, the polyester fiber industry was seriously damaged, and the terminal orders continued to be poor. Meanwhile, the price of PTA was very strong in the condition of tight supply. The 4-5 month big factory continued to buy back the spot, which also kept PTA prices high. The weak demand and high cost situation jointly squeezed the profits of polyester staple industry. The overall profitability of PET staple enterprises in the whole 2 quarter was relatively low, especially in the middle of June.

Three, supply and demand analysis

In 2019 1-6, the total output of domestic direct spinning polyester staple industry was 3 million 46 thousand tons, up 10.23% from the same period last year. The capacity of the industry has been adjusted to 7 million 821 thousand tons due to the commissioning of Yangzhou 100 thousand, Jiangyin Xiangyang 80 thousand tons and Jiangsu Jiangnan 100 thousand tons (regeneration and transformation project).

Figure 3 shows that the output of the 1-4 month direct spinning polyester staple fiber industry has increased significantly over the past year, but the downstream demand has not increased significantly. The terminal orders are not as strong as the trade environment in the past years due to the aggravation of the trade environment. The supply of polyester staple fiber industry has seen a slight surplus. With the higher raw material price extrusion, the profitability of the industry has declined. Some enterprises appeared to stop or overhaul production in May, resulting in a certain decline in the output of the industry. However, due to the expansion of the capacity base, the total output in the first half of this year was higher than that in the previous year.


In terms of import volume, the total import volume of PET staple fiber industry in 1-5 months increased by 87 thousand tons, up 20% compared with the same period last year. The reason for the increase in imports is that some of the differentiated direct spun short fiber products can not meet the needs of domestic market. The import of recycled polyester staple products in Southeast Asia has increased rapidly in recent years.

In 1-5 months, the total export volume of polyester staple fiber industry was 410 thousand and 100 tons, down 0.8% compared with the same period last year. Affected by trade disputes, the export volume of polyester staple fiber has not increased this year, but it has declined slightly.

2019-2020 Expansion plan of annual direct spinning polyester staple fiber enterprise

Corporate name	Capacity (10000 tons) / Year)	Planned production time	Device address	accessory products
Yangzhou	Ten	Two thousand and nineteen February 2013	Yangzhou	Low melting point and hollow staple fiber
Jiangsu Xiangyang	Eight	Two thousand and nineteen April 2013	Jiangyin	Psf
Suzhou Jiangnan	Ten	Two thousand and nineteen May 2013	Suzhou	Polyester staple fiber (regeneration line)
Huaxi Village, Jiangsu	Ten	Two thousand and nineteen July 2013	Jiangyin	Psf
Suqian Yida	Twelve	Two thousand and nineteen Year 5, June	Suqian	Psf
Yangzhou	Ten	Two thousand and nineteen Year (uncertainty)	Yangzhou	Low melting point and hollow staple fiber
Fujian Yi Jin	Seven	Two thousand and nineteen October 2013	Jinjiang	Psf
Suqian Yida	Thirty	Two thousand and twenty year	Suqian	Psf
Sinopec Yizheng Chemical Fibre	Twenty	Two thousand and twenty year	Yangzhou	Psf

In the future, there are still some new capacity plans for our polyester staple, but the new capacity is mainly differentiated products. As shown in the table above, if the new capacity is put into operation on schedule, by 2020, the capacity of China's direct spun polyester staple fiber will reach 8 million 600 thousand tons. However, with the slow growth of traditional demand and the constant friction of international trade, China's direct spinning polyester staple industry will once again suffer from oversupply crisis. At the same time, the competition in the industry will become more intense, and the market capacity of the future will be concentrated or become a new trend.

Four, market outlook

The complex and volatile global trade situation has increased the uncertainty of the future market trend. The polyester staple industry in the second half of the year is still "dangerous" and "machine" coexist.

From the point of view of raw materials, the pace of private large-scale refinery and production is accelerating, and the price difference between PX and naphtha will continue to maintain between 300-360 US dollars / ton; while the new production capacity of PTA will be on schedule or speeded up under the background of high processing fee, and the operating rate will also maintain relatively high level. However, since the operation rate of polyesters continues to be at a high level, and there is still a new production plan for the two or three quarter of the industry, or it will offset the bad operation of some of the new PTA installations. The supply and demand pattern of PTA in the second half of the year is still balanced, and the processing fees of industry can hardly be reduced to 800 yuan / ton.


From the perspective of polyester staple itself, the new capacity of polyester staple fiber will be dominated by differentiated varieties in the second half of the year, and there will be doubts about whether it can be put into production on schedule in the context of low profit. On the whole, the current supply and demand pattern of the industry has shifted, the slight surplus of supply side or the competition situation in the second half of the market will aggravate, and the profit level of enterprises will not rise. But in the near future, polyester staple enterprises are generally in the absence of inventory or oversold phenomenon, coupled with relatively strong cost support. In July, the average price of the industry or the high price of the market in the second half of the year. But then, along with the commissioning of the new PTA plant, PTA processing fees will gradually be sped up, or the risk of falling costs will increase or exacerbate the decline probability of PET staple fibers. The market outlook is generally weak in 8-10. But overall, the uncertainty of the external news is strong, and the market variables in the second half of this year are large.