China's Polyester Market Slows Down Due To G20 Summit
News
<< Back To News Home   |   Category :  Market News

China's Polyester Market Slows Down Due To G20 Summit
Shanghai, China | Friday, 23rd Sep. 2016  | By Textile Excellence
 0 Comments    0 Likes     368 Views          Print   

China's polyester textile filament market was heavily impacted by G20 Summit as a lot of plants shut down and spot prices were pushed up. However, polyester industrial yarn market was not impacted as much due to limited shutdown and slack demand. Guxiandao, Hailide and Huachun were the mainly affected producers. Guxiaodao has kept running at low rates due to poor profits and high inventory. Hailide shut the production of fibres not for car use, which occupied a small part in total capacity. As to Huachun, its total capacity was only 15 kta. Therefore, G20 regulation did not affect PIY production much, only about 10% of total PIY capacity in China.

 

August and September were the regular slack season of polyester industrial yarn as demand for downstream products for geo-technique or car use, etc. all decreased in hot days. However, demand was particularly soft this year. Domestic sales were restrained by logistic regulation during G20. Downstream plants widely stocked raw materials up with expectation of higher prices in the future and a few plants purchased about one-month volume. Foreign sales were brisk in the first half of 2016. PIY export growth expanded rapidly, far higher than that of 2015. Foreign buyers largely procured ahead of time. But then PIY exports decreased apparently and Aug/Sep exports may see negative growth rates.

 

So how to stimulate downstream demand and improve market situation? Sales promotion for sure. With the end of the month approaching, downstream may need to replenish their stocks and PIY plants may cut inventory at the point. However, market will sink into weakness quickly afterwards. In addition, PIY profits were very thin and most plants were on the deficit edge. September contract price of bright chip may not be lower than August CP so sales promotion at the end of the month will dampen profits further. Then cutting production may be the best choice. But Guxiaodao is running at low rate and other big plants report tolerable inventory.     

 0 Comments    0 Likes     368 Views          Print   
Post Your Comment
  
  //   E-PAPER   //   SPECIAL EDITIONS   //   NEWS   //   EVENTS   //    ARCHIVES