In late May, Huahong and Sanfangxiang plan maintenance, and the operating rate of direct-spun PSF is predicted to decrease to around 90 per cent at that time, which has limited impacts on the supply. In short term, direct-spun PSF will run under pressure.

Plants will not adjust up prices despite around cost line or facing losses due to previously high inventory and bearish outlook. According to CCFGroup, a considerable part of polyester yarn has flown to warehouses of traders instead of downstream. Bearish downstream demand and inventory accumulation of grey fabric are indisputable facts.

The weakness of upstream raw materials and sluggish downstream demand have not been reflected in polyester yarn prices which are offered stably by the mills. T32S is mainly traded at 11,800-12,100yuan/mt in Fujian, Jiangxi, Jiangsu and Zhejiang, and at 11,200-11,400yuan/mt in Hebei. Most market players believe that the inventory accumulation is likely to happen in May and Jun due to slack season.