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Prices of polyester filament yarn fall in China

Prices of polyester filament yarn in China kept falling in the second half of 2019. Stocks of grey fabric accumulated in September and the operating rate of fabric mills rose. In October, stocks of grey fabric declined by around six days, and players became more cautious in restocking. Some plants cut the run rate. Stocks of knitted fabrics dropped, mainly winter fabrics like plush fabric and water-jet fabric. Stocks of lining and silk-like fabric were especially high.

Downstream plants have a chance to hoard stocks when feedstock price is low. In addition, if feedstock price remains firm or hits a new low, some plants may prepare feedstock in advance. Some PET bottle chip plants plan to have a turnaround in November, but some polyester units that had a turnaround before will resume operation. Polyester fiber plants are unlikely to intensively cut the run rate in November supported by rigid demand and taking the spring festival into account.

New units in the upstream market are still anticipated to start operation but some are delayed. No change in capacity expansion is expected. Besides, the anticipation of end-user polyester demand will be revised slightly. Downstream players are not very confident on demand in the second half of the year.