Polyester Filament Yarn sector sees recovery amid optimism for 2025

Since mid-December, polyester filament yarn (PFY) sales have improved, with inventory dropping to its lowest in 2024. This was driven by better downstream business activity and record-low PFY prices, prompting bulk purchases. Consequently, prices have rebounded by 500–600 yuan/mt, restoring profitability for conventional products like POY150D/48F to 200–300 yuan/mt.

Despite the rebound, 2024 was underwhelming for PFY profitability. High production rates hindered inventory reduction and processing spread expansion. Production rose by 8.4 per cent due to better facility utilization and full-capacity operation of 2023’s 4.37 million tons of new capacity. Additionally, a collapse in polyester raw material costs devalued inventories, particularly for major manufacturers.

Looking ahead, 2025 holds promise. Production growth is expected to slow, with only 1.82 million tons of new capacity planned and production growth forecast at 2.2 million tons, a notable decline from 2024. Supply-demand dynamics may improve with more downstream DTY machines and regional supply tightness benefiting processing spreads.

Inventory devaluation risks appear lower in 2025, as stable raw material costs and a recovering processing spread are anticipated. While trade tensions may shift export patterns, China’s cost advantage could support raw material exports, mitigating major disruptions to the PFY sector.