Direct-spun PSF market lacks vitality with increasing product inventory in mills

PSF futures market once slumped by 1,000yuan/mt in early Apr impacted by the U.S. tariff policy. Although the price decline of spot PSF was smaller than that of futures market, market mindset was shifted apparently.

Before the Tomb-Sweeping Festival, downstream spinners intended to purchase feedstock at low level. But after the holiday, as prices continued to hit new lows and the tariff policies escalated and were hard to be solved in short, downstream buyers mostly became cautious.

Currently, feedstock inventory in polyester yarn mills has reduced to half a month, reaching a year low level.

Different from the trend of feedstock inventory, product inventory in mills continues to accumulate. Polyester/cotton yarn inventory has approached the high level since last year, and the inventory pressure emerges gradually later.

In addition, the expectations towards the orders in May and Jun weaken further. Some spinning mills plan to shut down during May Day holiday, with lack of confidence. In short, speculative demand is hard to see. Under the pressing demand from buyers, plants shall control the operating rate and inventory.