Polyester Filament: "Silver" Has Gone Far Away, "Silver Ten" On The Road.

The polyester filament Market in 2019 is in a general trend of shock and decline. In addition, in the traditional "high" season, the downstream weaving start up rate is decreasing, and the industry's confidence in the latter market is seriously insufficient. "The peak season" has long gone, and will "silver ten" be absent?

I look forward to it. I hope to arrive at the end of September. Although the stock of polyester filament mill is still at a low level for 6-18 days, the total inventory volume of the industry will increase significantly during the eleven long holiday period. Preferential sales promotion of some polyester filament factories has gradually increased, and the market of polyester filament yarn tends to maintain a weak trend before the holiday.

As can be seen from the above picture, the market price of polyester filament POY is basically maintained at the range of 7500-8000 yuan / ton from mid July to now. Compared with the same period last year, the three quarter of polyester filament market shock amplitude narrowed significantly, although the "peak season is not prosperous", but the traditional off-season market, polyester filament market price has not fallen below the low point in the year, plus the three quarter and steady industry profits in hand, polyester filament factory is also lost.

In the three quarter of the relatively low market situation, polyester filament enterprises still can make profits, thanks to the factory stock has been at a reasonable low level, making polyester filament market price and raw materials in a timely manner, and falling raw material is lagging behind. And polyester filament factory inventory low, and downstream production capacity is also inseparable from the barbaric growth.

Since the pressure of environmental protection increased in 2017, there has been an upsurge in the movement of looms from the coastal areas of Jiangsu and Zhejiang to the inland areas of the central and western regions of Jiangsu and Zhejiang provinces. According to Jin's understanding, there were reports that nearly 120000 looms loom out in Jiangsu and Zhejiang provinces, and the loom loom capacity has exceeded 200 thousand units.

At the same time, in the newly put into operation area, enterprises not only transferred old looms to suitable low-cost production bases, but also invested in new looms and expanded production scale in new bases. The current situation of the industry has made the downstream textile market capacity concentrated in the second half of this year. Although the homogenization competition in the downstream textile market has been intense, the textile market has become more difficult to stock, but the new textile cluster formed by North Jiangsu, China, Hong Kong and China has also increased the consumption of polyester filament.

Source: Jin

As can be seen from the above picture, the inventory of downstream weaving factories is high in the second half of this year. In September this year, the number of days in weaving factories remained near 39-40 days, far higher than the 27-30 days of the same period last year, close to 40-43 days in the same period in 2016. But in the four quarter of 2016, with the polyester industry chain market entering a new boom cycle, the pressure of weaving factory inventory can be solved. This year, the polyester industry chain market is in the doldrums. Following the conclusion of foreign trade Christmas orders and double eleven and two dozen orders, the weaving factory inventory still has room for improvement.

Under the pressure of weaving factories to inventory, the cash flow of factories is becoming more intense, and the enthusiasm for production is even more depressed. As can be seen from Figure 2, in mid September, the weaving factory operation rate has been showing signs of decline. During the eleven long holiday period, under the double pressure of sales and cost, the weaving enterprises that stop work or vacation will continue to increase, and the weaving plant's starting rate will continue to decline.

For the "silver ten" market trend, cost side, short-term geopolitical factors have a greater impact, the Middle East crude oil price risk premium, the international crude oil temporary resistance is still strong.

In addition, in October, the upstream raw material PTA has 3 sets of devices waiting to be overhauled, and the market price or support after the festival. However, the bad profits brought about by the new commissioning of the cost side and the supply side can not be ignored. It is expected that after the PTA market or after the consolidation of the market, the market trend of the future market still needs to pay close attention to the progress of key macroeconomic events such as Sino US trade negotiations. Affected by this, eleven long holiday returns, although the polyester filament factory inventory increased, but before the adjustment of the market price before the festival, the cost of polyester filament Market decreased or narrowed before the festival.

However, it is unlikely that the downstream demand will improve. It will still be dominated by maintenance. The main raw material of the textile factory is concentrated procurement. If there is no good stimulation, it is expected that the market price of polyester filament POY will remain at the range of 7500-7900 yuan / ton in October.