August 31 news
Commodity market analysis system, in August, polyester staple fiber (1.4D*38mm) overall showed a trend of first declining and then rising. At the beginning of the month, the average market price in China was 7,564 CNY/ton, an increase of 3.34% compared to the end of the month. This round of increase was mainly driven by the rise in upstream costs and the industry's proactive reduction in production to maintain prices, but the terminal demand in China remains weak.
In early August, China was in the high-temperature textile off-season, with terminal autumn and winter orders yet to be released in large numbers. Downstream yarn mills were very cautious in their purchases, only maintaining essential restocking, resulting in a weak market trading atmosphere and short fiber prices fluctuating at low levels. Due to the small fluctuations in PTA prices, the processing spread for short fibers remained negative, leading to widespread losses among enterprises and insufficient momentum for price increases. In the first ten days of August, international crude oil prices rose due to geopolitical conflicts, driving up the prices of PTA and ethylene glycol raw materials and significantly increasing production costs. At the same time, industry losses intensified, and major short fiber companies began to cut production to stabilize prices, actively reducing their operating rates. This led to a tightening of spot supply in the market, and multiple factors combined to push the price of polyester staple fibers to rise in a fluctuating manner.
Looking ahead to September, polyester staple fiber will enter a phase of bullish and bearish competition, with a high probability of maintaining a high-level fluctuation, and the momentum for a unilateral sharp increase is limited. On the supply side, industry production cuts to maintain prices will continue, but attention should be paid to the resumption pace after the recovery of corporate profits. If processing fees improve, some facilities may resume production, leading to an increase in supply and suppressing the upward space for prices.
On the cost side, PTA units undergoing maintenance are gradually resuming operations, leading to a marginal easing of raw material supply and a weakening of cost support. Meanwhile, ethylene glycol port inventories remain relatively low, providing some floor support for prices. Overall, costs are now more closely tied to fluctuations in crude oil prices.
The demand side is entering the traditional “Golden September” peak season, but there remains considerable uncertainty regarding the recovery of downstream textile orders. Downstream yarn mills have relatively high inventories of finished products and are not eager to replenish their stocks. If peak-season orders fall short of expectations and downstream purchasing continues to remain weak, prices of staple fibers could face downward pressure. Going forward, it will be crucial to closely monitor the intensity of production cuts, fluctuations in raw material prices, and the actual realization of downstream orders.
