Polyester prices have declined in the last seven days in China and Pakistan, reflecting a lack of demand on the Chinese market. With PTA prices far from sliding, margins have sharply decreased at fiber plants in China.
Polyester fiber prices have continued sliding in the first days after the May Day break in China.
The benchmark indicator for 1.4D PSF has lost 100 yuan per metric ton or 1.2%, falling 470 yuan or 5.2% from its level four weeks earlier.
Filament prices have also dropped in the meantime, with the POY indicator losing 140 yuan per MT or 1.6% in the last three days, therefore plunging by 9.7% in four weeks.
FDY prices haven even fallen more than 10% in a single month in Qianqing (Zhejiang).
Demand is clearly weakening from filament weavers and also from spinners.
Operating rates have been lowered at filament weaving plants in Jiangsu and Zhejiang.
However, the polyester fiber production is kept unchanged with a few plants returning to normal after experiencing maintenance operations.
Gross margins have however sharply fallen at fiber plants in the past weeks, as reflected by our new charts in this report.
PTA prices have until now benefited from relatively tight supply situation in the Far East.
If they do not fall in the coming period, polyester producers could be forced to cut their operating rates in order to support prices and margins.
If PTA prices would eventually decline, polyester prices could drop to lower levels.
If considering historical data, polyester prices are still at relatively high levels, as reflected by our below chart.
Source: Emergingtextiles
