June 21st, News
The weakening of costs significantly led to a decline in the market price center of polyester staple fiber this week (June 15-21). According to the commodity market analysis system, as of June 21, the average market price of polyester staple fiber (1.4D*38mm) in China was 7,539 CNY per ton, a decrease of 3.65% from the beginning of the week.
International oil prices are trending downward. As of the 17th, the settlement price for the July WTI crude oil futures contract in the U.S. stood at $76.79 per barrel, while the settlement price for the August Brent crude oil futures contract was $79.55 per barrel. With ongoing developments in U.S.-Iran reconciliation and expectations of resumed navigation through the Strait of Hormuz, geopolitical risk premiums are set to further dissipate. Consequently, oil prices are likely to remain volatile and generally weak, as the market continues to balance the pace of reopening shipping lanes against the timing of increased crude oil supply.
This week, the PTA market in China showed a downward trend. According to the commodity market analysis system, as of June 21, the average spot price of PTA in the East China region was 6,116 CNY per ton, a decrease of 5.51% from the beginning of the week. In terms of supply, this week, the No.1 2,500,000-ton facility of Dushan Energy restarted on June 15, with the industry's operating rate around 87%. With maintenance expectations at the end of the month, the supply is expected to be reduced, and there are expectations for the restart of some downstream polyester facilities. Therefore, the inventory in the industry continues to decrease, providing support to the market prices.
From the demand side, as costs plummet and the off-season for high-temperature apparel and home textiles sets in, downstream yarn mills are facing difficulties in shipping their products, leading to consecutive price reductions. Spinning mills are experiencing insufficient orders, and inventories of finished yarn are slowly accumulating. Market participants are adopting a wait-and-see attitude toward raw material procurement; spinning mills and traders are reluctant to stock up in advance, with transactions largely driven by immediate needs.
Analysts believe that currently, with weakening costs and persistently weak demand in the off-season, but the losses in polyester staple fibers and spinning forcing production cuts, factories are actively controlling output to support prices, thus limiting the room for a significant drop.
Additionally, according to Xianhuotong, the 10-day moving average has crossed below the 20-day moving average, and the difference between the two averages continues to widen in a negative direction. The 10-day and 20-day moving averages are diverging further, indicating that the polyester staple fiber market is entering a downward channel.
Combining the 5-level position, the current price is in the middle range of the past year in China, and caution is needed.
