China Fabric Factory Fabric News The epidemic “pours a ladle of cold water down”, and the falsely high market price “reveals its true colors”! Next, can polyester filament “hold up”?

The epidemic “pours a ladle of cold water down”, and the falsely high market price “reveals its true colors”! Next, can polyester filament “hold up”?



Beginning in December, driven by the official put into operation of the new crown vaccine, the polyester market began a sustained surge driven by international oil prices. In half …

Beginning in December, driven by the official put into operation of the new crown vaccine, the polyester market began a sustained surge driven by international oil prices. In half a month, polyester filament prices have increased by nearly 600 yuan/ton. PTA and ethylene glycol have also increased to varying degrees. At the same time, gray cloth, fabric prices and dyeing fees have also increased to a certain extent.

But in the face of this price increase, the opinions of cloth bosses are divided into two levels. Last week, China Silk City Network conducted a market survey in which more than 200 textile people participated. Among them, 44% of the textile people felt that polyester yarn would continue to rise, and 56% of the textile people felt that it would not continue to rise.

However, the good times did not last long, and bad news soon came. On December 19, local time in London, British Prime Minister Johnson delivered a national address. Due to the new variant of the new coronavirus, the number of confirmed cases in the UK has dropped sharply in the past two weeks. Increased internally. And this news also “pours a ladle of cold water” on the polyester filament that had previously surged.
Affected by this, international oil prices fell sharply. As of the close on December 21 (Monday), the price of light crude oil futures for January 2021 delivery on the New York Mercantile Exchange fell by US$1.36 to close at US$47.74 per barrel, a decrease of The price of London Brent crude oil futures for delivery in February 2021 fell by US$1.35 to close at US$50.91 per barrel, a decrease of 2.58%.

Polyester filament prices are still stable for the time being , but production and sales fell significantly. On the 21st, the average production and sales of polyester factories were only 30-50%.

Polyester prices continued to rise sharply in December, reasons Mainly in two aspects.

Excessively low raw material prices

Under the influence of the epidemic, the price of polyester filament this year can be said to be the lowest in history. The same is true for the prices of PTA and ethylene glycol. This low price can only be found in This is only possible under the special circumstances of the global epidemic. The decline in polyester raw materials at the beginning of the year is really too large. If the raw material prices want to return to normal, they will inevitably need to increase prices in stages over a long period of time. It just so happens that the bulk commodities on the market are rising during this period, and it is understandable that polyester yarns are also rising.

Expectations for improvement in market conditions next year

However, before commodity The rise in prices is based on the expectation that the market will improve next year, but in fact, no one can tell what the market will be like next year before the time is reached. The current common market logic is that as long as a vaccine appears, the epidemic can be controlled immediately, and after the epidemic is controlled, demand will immediately pick up. And such a logical chain itself is relatively fragile. As long as there is an error in one link, the entire logic will collapse.

Judging from the production and sales of polyester factories, textile companies have indeed “paid for” the increase in raw material prices. However, from what the editor has learned, such operations by weaving companies , rather than “buying in” or “chasing the rise”, it is better to say it is a kind of “stop loss”.

Mr. Li, the person in charge of a weaving company with 200 looms, said that due to the recent increase in raw material prices, some raw materials have indeed been stocked, but at the same time, the current order situation is not good. Optimistic, inventory is accumulating, causing great financial trouble.

Trader Mr. Zhao also said that at the end of this year, downstream orders were almost half less than in previous years, mainly because everyone is still not confident about next year’s market. Although The vaccine is already out, but it still takes a certain amount of courage to spend real money to stock up.

It can be seen that the downstream support for the previous increase in polyester prices was still very “empty”. Therefore, after the market was negative, the cloth bosses immediately “covered it up” money bag”.

Will polyester prices fall?

For textile companies, although they are concerned about the prices of bulk commodities such as PTA and ethylene glycol, in the final analysis, what matters is the price of polyester filament. Will polyester filament fall after the market goes bad?

The editor’s personal opinion is that although the price of polyester yarn may see a slight correction, it is unlikely to fall back to the price at the end of November. On the one hand, the average inventory of small polyester factories is not high at this stage, and large…Polyester factories have sufficient funds to deal with inventory and do not need to reduce prices to promote production and sales; on the other hand, there is a high probability that there will be a wave of stocking up at the end of the year, so polyester factories are not too panicked.

However, in any case, it is normal for polyester yarn to decline to a certain extent when the epidemic situation recurs. Therefore, if cloth bosses do not have particularly urgent needs in the near future, they may wish to wait and see for a while, and wait until the negative impact of the European epidemic is fully digested by the market before considering buying silk or stocking up on raw materials.

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Author: clsrich

 
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