Cost Benefits Drive a Noticeable Price Increase in Polyester Staple Fiber

December 22nd, according to reports

According to the commodity market analysis system, on December 22, the price of polyester staple fiber in China increased significantly. The average market price of polyester staple fiber (1.4D*38mm) was 6,370 CNY/ton, up 1.19% from the previous trading day.

The geopolitical conflicts between Russia and Ukraine, as well as between the U.S. and Venezuela, provided a short-term boost to oil prices, and on December 19, international crude oil futures closed higher. The February contract for U.S. WTI crude oil futures settled at $56.52 per barrel, up $0.52, or 0.9%. The February contract for Brent crude oil futures settled at $60.47 per barrel, up $0.65, or 1.1%. Recently, there have been few changes in PX plant operations; inventory is expected to accumulate slightly in December. However, given tight spot market liquidity and low inventory levels, PX prices remain supported.

As of the close on December 22, the 2605 PTA contract closed at 5040 CNY/ton, up 218 from the previous day's settlement. The spot market also remained strong, with the PTA spot price in the East China region at 4879 CNY/ton on the 22nd, according to the commodity market analysis system, up 3.04% from the previous trading day. In terms of supply, the operating rate of the PTA industry in China is around 73%. With low processing fees, factories' production enthusiasm is limited, and there is a possibility of additional unplanned maintenance, so the increase in supply will be limited.

Downstream yarn factories show a lukewarm response to the rising raw material prices, with a strong wait-and-see attitude. Market transactions are mainly driven by rigid demand, with most maintaining stable prices and focusing on shipping. Some yarn factories report insufficient orders, leading to increased sales pressure. With the impact of the off-season for consumption, demand has weakened, and inventory accumulation is observed in both weaving and knitting sectors.

Analysts believe that in the crude oil market, Russia and Ukraine are unlikely to reach a peace agreement in the short term, increasing geopolitical risks. Additionally, the peak oil consumption season for Christmas in Europe and America, along with improved demand in some regions, provides support for oil prices. With PTA continuing to deplete inventory and low processing fees, it maintains a strong trend, thus keeping the raw material end of short fibers firm. However, the terminal market is lukewarm, with low enthusiasm for chasing higher prices, leading to moderate procurement activity from yarn mills, which puts pressure on the price of short fibers.