Polyester Staple Continued To Decline In July, Making It Still Downside.

After entering the July, the polyester staple fiber seems to be a bit shrivelled, and the confidence in the market appears to be insufficient, and the price has also dropped. At the present stage, the cost side is in need of consolidation after a continuous decline. However, the enthusiasm of downstream replenishment is weak, and there are even high temperature vacations in local spinning mills.

So how can the trend of two polyester staple fibers fluctuate after this round of decline?

Raw material support is weak.

From the raw material aspect: on Monday, along with the mass shipment of PTA factories, the concentration of the spot market was broken, and the closing price of PTA also showed that the liquidity in the spot market was strong. As a result of the rapid decline of the base, we can see that the release trend of spot liquidity is not yet over.

And glycol, although the spot is tight, but polyester production and marketing week continued to be light, and the factory production more, demand side obvious, affected by this, ethylene glycol within the week is limited, and there is a downward risk. Under the "buying up or buying down" sentiment, the raw material weakness has made the polyester staple fiber Market lose its price support, and it is also one of the factors in the current price adjustment of polyester staple fiber.

The fundamentals are relatively stable.

Compared with other polyester products, the supply and demand side of polyester staple is relatively normal. From the point of view of profitability, polyester staple is the best. As of July 22nd, the average daily profit of polyester short is 395 yuan / ton.

From the start of the industry, there was no obvious reduction in production in July, and this week, the operating rate of the industry was also maintained at 83.70%. The real reason for the decline is nothing more than a concern about trade risks and a panic over the collapse of cost prices in the joint production of polyester factories. Prices are falling, production and sales are slack, and short and short inventories are gradually increasing.

Polyester staple and polyester filament stock

The downstream performance is not satisfactory.

Although downstream demand is light, manufacturers have strong desire to inventory. Due to fears that raw material prices will continue to fall and yarn costs will be lowered, most polyester manufacturers will be more willing to inventory. As of July 24th, a 32S polyester yarn of a factory in Shandong was reported to be 16500 yuan / ton (the factory was opened by ballot), and there was no change in price compared with July 15th. According to different regional markets, pure polyester yarn price performance is also different, overall, local prices are down, such as Shengze T32S, T50S mainstream price 12600-12700 yuan / ton, 14500-14600 yuan / ton.

On the whole, although there has been no significant decline in the short running rate, the weaker market is already exacerbating the psychological conflict among downstream buyers. The increase in staple mill inventory will also continue to suppress market prices, and eventually the company will be forced to cut prices again or reduce production. In addition, when raw materials PTA and MEG continue to be disadvantaged, the market price of polyester staple fiber still has a certain downward trend. (source: China cotton net, Zhuo Chong information)