Inventory burden of polyester industry accelerates emerging with slow recovery of downstream market

As for export, the spread of epidemic overseas gradually affected export orders when the restart delay of some domestic companies impacted the delivery and some export orders were transferred to Southeast Asia. Demand also diminished in some nations on COVID-19 outbreak, so overseas buyers slashed the volume of orders or canceled orders. Based on Customs statistics, export of textiles, yarns, fabric and made-ups was near USD$13.7725 billion in Jan-Feb, 2020, down by 19.9% on the year, and that of apparels and accessories amounted to $16.0623 billion, down by 20% compared with the same period of last year.The spread of epidemic overseas also exerted influence on the total export orders. The situation in Japan, South Korea, Iran and Italy was serious, and Japan was the third largest export destination for Chinese textiles and apparels, sharing 7.3% of the total. South Korea was not major export market for Chinese textiles and apparels but there were many textile and apparel traders. In addition, the movement of COVID-19 in Europe and Middle East should be concerned later.

Inventory burden of polyester industry accelerates emerging with slow recovery of downstream market
The resumption of downstream market was belated for around 1 month on the COVID-19 outbreak. Downstream plants were anticipated to restart production on Feb 1 by convention, but many extended it after Feb 20 or even in early-Mar. The actual recovery was slow even after the production resumed with the lack of workers and orders. Most fabric mills witnessed scarce export and domestic orders after the Lunar New Year holiday, showing low production activity, coupled with collapsing feedstock price.