The first quarter of 2023 chemical fiber industry operation analysis

First, the basic situation of industry operation

(1) Production and marketing

Data from the National Bureau of Statistics show that the production of chemical fiber in January-February 2023 was 9.61 million tons, a decrease of 5.99% year-on-year. After the Spring Festival, the textile chemical fiber industry chain resumed work and production gradually, and the overall load of the chemical fiber industry in March increased from the previous month, such as the average load of direct spinning polyester filament in March exceeded 80%.

Under the comprehensive superposition of seasonal demand, annual backlog demand, and intermediate link replenishment demand, domestic demand orders performed better, and the average operating rate of Jiangsu and Zhejiang Ammunition, Jiangsu and Zhejiang loom, and Jiangsu and Zhejiang round machine in March was 88%, 75%, and 56%, respectively, which increased compared with the same period in 2022. In March, the average daily turnover of the textile city was about 7.8 million meters, and the same period in 2022 was about 5.8 million meters. In the first quarter, the connection between chemical fiber production and marketing was basically smooth, and the inventory of main products was improved compared with 2022, and the average inventory of polyester POY, FDY and DTY was about 15 days, 20 days and 25 days, respectively.

(2) Market price

In the first quarter, crude oil prices remained in the range of $70 to $80 per barrel. In March, the oil market was affected by the banking crisis, demand expectations were significantly weakened, and oil prices fell to a new low for the year, about $67 / barrel. At present, the price of crude oil has recovered to around $80 / barrel. The chemical fiber market is limited by external events, and the correlation between the price of chemical fiber products and the trend of crude oil has weakened in March, which is more of the game within the industry.

Note: WTI futures (right axis, USD/barrel), PTA, Polyester POY, polyester staple fiber (left axis, Yuan/ton)

In the first quarter, the price increase of PTA in the polyester industry chain was greater than that of polyester, and the price increase was more obvious under the tight pattern of PTA supply and demand in March, and the benefit of polyester industry was compressed. The cost transmission of the nylon industry chain is slightly smooth, and with the increase of downstream demand after the Spring Festival, the price difference between the nylon fiber and the raw material is slightly expanded, but the nylon industry is still running at a slight profit. In terms of spandex industry chain, raw material PTMEG due to less capacity expansion, cost-effective supply of goods showing a tight state, the price increase is obvious, but the price of spandex products is far less than the raw material, still in the stage of correction stage, and the first quarter of spandex has new production capacity, production and sales pressure increased, inventory increased.

Unit: US Dollar, RMB Yuan

Source: China Chemical Fiber Association

(3) Import and export information

According to China Customs statistics, the total export volume of chemical fiber main products increased by 23.60% year-on-year in January-February, of which polyester filament, polyester staple fiber, polyester bottle sheet continued high growth trend, viscose staple fiber and spandex exports fell significantly year-on-year. During the same period, chemical fiber imports decreased by 25.63% year-on-year, accounting for only 0.6% of domestic demand.

(4) Terminal market

Since 2023, policy measures to stabilize the economy have been further effective, combined with factors such as the fading impact of the epidemic, and the domestic market has changed from a decline to an increase, and the market vitality has rebounded. Data from the National Bureau of Statistics show that from January to February, the retail sales of clothing, shoes and hats, needles and textile products in units above the quota in the country were 254.89 billion yuan, an increase of 5.4%, the growth rate was 0.6 percentage points higher than the same period of last year, and the growth rate was 11.9 percentage points higher than that of 2022, and the growth rate basically returned to the level before the epidemic. The growth of online retail channels was relatively stable, and the national online retail sales of wear goods increased by 4.0% year-on-year from January to February, the growth rate was slightly higher than that of the same period last year by 0.1 percentage points, and the growth rate was 0.5 percentage points faster than that of the whole year in 2022.

In terms of exports, in the context of the global economic downturn, consumption power and consumer confidence in major developed markets have been depressed. At this stage, the industry's foreign trade exports are still affected by factors such as weak demand and insufficient orders, and will continue to be under pressure for some time to come. According to Chinese customs data, in January-February, China's textile and garment exports were 43.31 billion US dollars, down 17.8 percent year-on-year. Among them, textile exports were 20.39 billion US dollars, down 21.7% year on year; Apparel exports were $22.92 billion, down 13.9 percent year on year.