Market Trends: Polyester Filament Has Been Promoted By The Company Again

In the off-season of traditional demand in August, the production and sales of polyester filament were sluggish, the inventory of enterprises was increasing, and the promotion frequency was accelerated. After the centralized promotion last Friday, the preferential delivery mode of polyester filament was continued today. However, the terminal demand was weak, the purchasing power of users was not strong, and the production and sales data of polyester filament were not good.

As shown in the figure, since the second quarter, the polyester filament market has been in a downward trend, especially from the end of April to the end of June, the price of polyester filament recovered after the end of promotion, and the periodic repeated promotion also made the trend of fluctuation range of polyester filament. At the end of June, due to the support of the cost side, the fabrics in autumn and winter were mostly started in advance. With the boost, polyester filament showed a slight upward trend. However, due to the reality of low demand, the polyester filament continued to rise without enough momentum. After the middle of July, the promotion mode was repeated. August is the traditional off-season of polyester filament demand, and some orders have been overdrawn in the early stage. Therefore, the high inventory and low demand of polyester filament drag down the market to open a falling mode.

Figure price comparison of mainstream polyester filament models in 2021

Source: Longzhong information

During the month, the average daily production and sales of domestic polyester filament were mostly maintained at 30-50%. During this period, there were four large-scale profit making promotions. During the promotion period, the production and sales were not as good as the industry expected. The average daily production and sales rate of the two rounds of promotion in the middle of the month was around 200%, and the sales promotion at the beginning of the month and today were not more than 100%.

Within the month four Comparison of sales promotion

Source: Longzhong information

In the middle of the month, leading enterprises of polyester filament successively issued production reduction plans. Under the expectation of supply reduction, polyester filament still gave up profits and promoted sales. Although the downstream users were cautious, they were worried about the supply tightening in the later period and the price was expected to rise. Therefore, the warehouse was moderately replenished. As shown in the table above, the average daily production and sales of polyester filament in the third round of promotion was around 200%, and the production and sales of some enterprises were between 300% and 500%. Today's promotion is less than a week away from the last round of promotion, and downstream users have not fully digested the inventory. At present, terminal weaving also faces the dilemma of scarce orders. The inventory of grey fabric is increasing, and the inventory of weaving and texturing enterprises is not good, and the funds are tight. Therefore, the purchasing scale is reduced and the purchasing frequency is slowed down.

Figure 2 Comparison of polyester filament and terminal weaving stock

Source: Longzhong information

As shown in Figure 2, the inventory of polyester filament and final weaving products shows an upward trend, while the inventory of weaving raw materials has been declining since the third quarter, which also confirms the trend of decreasing downstream weaving procurement scale and frequency. With the repeated epidemic situation at home and abroad, the textile and clothing export resistance is large, while the domestic demand is weak, and the terminal weaving enterprises are struggling. At present, the burden of weaving machines in many places has been reduced. Some enterprises with high inventory have stopped for a short time. Even if the price of raw materials is low, the end users are unable to stock up. At present, most of the users just need to purchase polyester filament, and the purchase is mostly within one week when promoting polyester filament. Frequent sales promotion may not change the current predicament of polyester filament. However, with the increase of enterprise inventory pressure, promotion can be regarded as an effective means of shipment. Polyester filament enterprises are in a dilemma at present. If there is no other significant good news to boost, according to the current promotion results, it is expected that there will still be profit margin shipping at the end of the month.