due to trade war PSF and cotton both plunged in short time and market sentiment was hit seriously

Secondly, due to trade war, PSF and cotton both plunged in short time and market sentiment was hit seriously. The cotton price even experienced 400yuan/mt of decrease in one day and did not show sign of a stop. The sharp fall of raw materials weakens downstream demand, and most customers turn cautious and prefer to stand on the sidelines. Polyester/cotton yarn price is also forced down by lower cost.

Thirdly, sales in domestic and overseas markets both stagnate. The inventory of polyester/cotton yarn mills stays high generally. High inventory pressure and scarce orders are reported by major producers like Shandong, Henan, Jiangxi and Fujian. Support for price disappears amid the slide of demand and surge of inventory and market players also hold negative expectation to later market.

As things stand, the high inventory will trigger sell-off on a large scale later. With ample supply, underselling appears in some regions and it will be more widespread later. The price of polyester/cotton yarn is still in downtrend and the decrease is enlarging. In Jun, traditional slack season has come and the soft demand is hard to improve in short run, thus polyester/cotton yarn price will retreat sharply. For the mills, it will be “a protracted war” on generally sluggish demand.