On May 14, the spot price of polyester staple fiber in Jiangsu market recorded one of the year's most notable single-day drops: down 105 yuan/ton from the previous day to 8,050 yuan/ton. Prices weakened rapidly in the morning session following upstream raw material cost declines, with the negotiation range slipping to 8,000-8,100 yuan/ton, and some low-priced lots even dipping below 8,000 yuan/ton. This price movement is not an isolated event but a typical reaction of the cost transmission mechanism in the polyester chain under an overcapacity landscape.
Cost Collapse and Price Deviation
The direct trigger for this drop was a significant correction in upstream raw material prices, mainly PTA and MEG, in recent days. As the direct cost components of polyester products, a 1% fluctuation in raw material prices typically drives a 0.8%-1.2% linkage in staple fiber. However, the 105 yuan/ton decline deviated by about 15-20 yuan/ton from the raw material cost reduction. This means that even accounting for the cost decline, the staple fiber price drop exceeded the reasonable range of pure cost transmission.
Such deviation is uncommon in industry data. Typically, during cost downturns, staple fiber producers buffer the impact through production cuts or price support. But the current situation is the opposite: the price drop exceeds the cost decline. This points to a deeper cause—weakening downstream demand absorption capacity.
Industrial Zone Response and Inventory Pressure
Jiangsu, as a core production area for polyester staple fiber in China, often serves as a bellwether for the national market. Feedback from the industrial zone indicates that loom operating rates in Jiangsu and Zhejiang have declined slightly for three consecutive weeks, with some small and medium-sized weaving mills actively reducing loads due to insufficient orders. This has directly slowed the pace of staple fiber procurement, shifting from "replenishment as needed" to "buy as you use."
Meanwhile, inventory levels at staple fiber plants are accumulating. According to industry data, as of early May, finished product inventory days at major staple fiber producers increased from about 7 days at the end of April to 10-12 days. Rising inventory pressure, coupled with expectations of further raw material cost declines, has forced mills to adopt price-cutting destocking strategies, accelerating the price decline.
Broken and Restructured Upstream-Downstream Transmission
Traditionally, price transmission in the polyester chain was linear: crude oil → PX → PTA/MEG → polyester chip/staple fiber → yarn → grey fabric → apparel. But in the past two years, with massive capacity expansion in PX and PTA, profit margins in intermediate links have been severely compressed, allowing cost fluctuations to pass downstream more directly and rapidly.
This sharp staple fiber price drop is precisely a manifestation of this "cost express lane" effect. However, downstream weaving and apparel demand elasticity is limited. When costs fall too fast, end buyers tend to wait for even lower prices, amplifying the "buy on uptrend, not downtrend" mentality and further depressing transaction centers.
For staple fiber producers, this means further erosion of pricing power. In an overcapacity environment, factories can no longer influence prices through active supply adjustments; they can only passively follow raw material fluctuations. Downstream buyers, on the other hand, have gained stronger bargaining power, especially when orders are insufficient, making price-cutting intentions more pronounced.