Polyester slices enter a period of steady development

Reviewing the market price trend of polyester slice in the past 8 years, polyester slice market overall presents cost-driven characteristics, basically follow the trend of polyester raw materials PTA, glycol market, presents cost fluctuations, there is no obvious independent market. The main reasons: First, polyester slice capacity is in a state of excess, but different types of polyester slice products, the degree of excess is different; Therefore, when the melt straight spinning products close to the loss, slice spinning has lost money, can only choose to reduce the load or stop production, resulting in a decline in demand for slices
China
. The market then appears as polyester slice loss-subsidized slice spinning, so that it can compete with melt direct spinning in terms of cost. In addition, the fluctuation of the market price of polyester slice is closely related to the change of supply and demand in the industry.
Figure 1 2012-2019 Polyester slice market price trend chart
Data source: Jinlian-Tsing
2012-2013, polyester production capacity continued to grow at a high rate, but the domestic major slice spinning production base of slice spinning investment showed a significant cooling, New slice spinning capacity has been sharply reduced, the demand for polyester slice growth has formed a constraint, so the new capacity of polyester slices decreased, but the "side cutting output" continues to grow, polyester slice market overcapacity situation is still serious, resulting in wide fluctuations in the market price of polyester slices, showing a deep "V" trend, constantly volatile downwards.
2014-2015 was a tough two years for the polyester industry. Overcapacity encountered low demand, the average price of polyester-related products hit a new low of 5 years, while production profits fell sharply or even long-term losses, some poorly run enterprises or backward production capacity was eliminated, affected by this, polyester slice market prices all the way down, the loss situation is difficult to see the bottom.
2016-2018, the polyester slice market entered a new boom cycle, the polyester slice market every year ushered in a sustained period of substantial increase. In 2014-2015, polyester plant several large-scale shutdown maintenance, control of market supply, as well as a large number of old polyester capacity shutdown, polyester market oversupply situation eased, polyester market recovery, in 2016, polyester slice market prices maintained a volatile upward trend, and in November, polyester slice market ushered in a sustained sharp rise. At that time, the collective rise of peripheral commodities, raw materialS PTA futures rose and stopped, the spot market center of gravity rose, and another raw material ethylene glycol market rose sharply, cost support is strong, coupled with the release of downstream demand, upstream and downstream warm, together to boost the polyester slice market price continued to rise. In 2017, faced with the history of severe environmental protection policies landed, downstream weaving plant orders overall ahead of schedule, in June 2017, downstream demand release, driving the polyester slice market production and sales higher, driving the polyester slice market prices again sustained volatility. By the end of July 2018, the raw material PTA futures market was soaring, and the spot market price had broken through the five-and-a-half-year high. Subsequently, the strong return of upstream PX for the PTA in the cost of adding a fire, coupled with the shortage of PTA spot supply, and the crazy speculation on the capital side, jointly promoted the PTA surge. Driven by cost pressures, the market price of polyester slices has reached a near six-year high, close to the 2012 high. However, the downward transfer of costs is not smooth, after mid-October, polyester slice market into a long period of post-boom repair, for the market's new boom cycle has drawn an awkward end.
outlook for 2019, the average processing difference of raw materialS PTA is expected to continue to rise in the profit transfer upstream and downstream of the industrial chain, PTA center of gravity will continue to rise steadily, to a certain extent, driving the entire industrial chain upward, the cost-driven role is more ideal. While there is no significant new production capacity in the polyester slice market, the increase in production in 2019 is still mainly due to the side-cutting output of polyester polyester plants, coupled with the multi-adjustable side-cutting output, the overall supply pressure growth of polyester slicing plants is limited. In addition, the current number of new orders from downstream slice spinning enterprises from colored silk and differentiated fibers, in China's textile and garment market to carry out the key period of industrial upgrading, downstream emerging market demand will maintain stable growth, the polyester slice market in 2019 is expected to be the overall volatility or narrowing, the market or enter a period of steady growth.