Report Industry Investment Rating - No relevant content provided Core Viewpoints - Market rumors of the PTA industry's "anti-involution" policy drove the PTA price to rise rapidly in the afternoon. Despite the continuous recovery of crude oil prices, the PTA price had only rebounded slightly before. Although the overall load of domestic PTA plants decreased due to low processing fees, the polyester industry's profit was still constrained by overcapacity pressure from new production capacity and overseas plant commissioning. With the cost support provided by rising crude oil prices, the PTA price rebounded rapidly after a long period of low operation, stimulated by policy expectations. Currently, the operating rate of the polyester downstream remains above 91%, with demand slightly exceeding expectations, and recent polyester production and sales have been relatively high. Additionally, against the backdrop of positive news from the China-US economic and trade negotiations over the weekend, overseas demand for Chinese textile and clothing products is expected to recover [2] Summary by Related Catalogs Short Fiber Data - The main futures of polyester staple fiber rose by 82 to 6242. In the spot market, the prices of polyester staple fiber production plants fluctuated slightly, while those of traders increased slightly. Downstream purchasing intention was low, and on-site transactions were average. The price of 1.56dtex*38mm semi-gloss (1.4D) polyester staple fiber in the East China market was 6150 - 6460 (cash on the spot, tax-included, self-pickup), 6270 - 6580 in the North China market (cash on the spot, tax-included, delivered), and 6150 - 6370 in the Fujian market (cash on the spot, tax-included, delivered) [2] - The short fiber basis decreased from 178 to 78, a change of -100. The 11 - 12 spread decreased from 32 to 14, a change of -18. The polyester staple fiber cash flow increased from 240 to 246, a change of 6 [2] Bottle Chip Data - Market news indicated that raw material PTA and bottle chip enterprises were about to launch anti-involution work, which was beneficial to the supply side. Raw material prices rose significantly, and polyester bottle chip factories followed suit, increasing prices by 50 - 70. The market center also moved up. However, downstream and traders were unable to follow the price increase. It was reported that the morning transaction price was 5650 - 5700, and it was raised by 50 in the afternoon. The difference between bid and ask prices was large, and transactions were scarce [2] Price and Cost Data - PTA spot price increased from 4450 to 4505, a change of 55. MEG domestic price decreased from 4187 to 4183, a change of -4. PTA closing price increased from 4518 to 4616, a change of 98. MEG closing price increased from 4077 to 4109, a change of 32 [2] - The price of 1.4D direct-spun polyester staple fiber increased from 6400 to 6405, a change of 5. The price of 1.4D imitation large chemical fiber remained unchanged at 5400. The price difference between 1.4D direct-spun and imitation large chemical fiber increased from 1000 to 1005, a change of 5 [2] - The price of East China water bottle chips increased from 5677 to 5725, a change of 48. The price of hot-filled polyester bottle chips increased from 5677 to 5725, a change of 48. The price of carbonated polyester bottle chips increased from 5777 to 5825, a change of 48. The price of overseas water bottle chips increased from 750 to 755, a change of 5 [2] - The bottle chip spot processing fee increased from 470 to 472, a change of 2.32. The price of T32S pure polyester yarn remained unchanged at 10300. The T32S pure polyester yarn processing fee decreased from 3900 to 3865, a change of -5 [2] - The price of polyester-cotton yarn 65/35 45S remained unchanged at 16350. The price of cotton 328 increased from 14555 to 14565, a change of 10. The profit of polyester-cotton yarn decreased from 1605 to 1598, a change of -7.1 [2] - The price of primary three-dimensional hollow (with silicon) remained unchanged at 6955. The cash flow of hollow staple fiber 6 - 15D decreased from 548 to 502, a change of -45.69. The price of primary low-melting staple fiber remained unchanged at 7410 [2] Operating Rate and Production and Sales Data - The direct-spun staple fiber load (weekly) increased from 93.90% to 94.40%, a change of 0.01. The polyester staple fiber production and sales increased from 51.00% to 80.00%, a change of 29.00%. The polyester yarn startup rate (weekly) remained unchanged at 63.50%. The recycled cotton-type load index (weekly) decreased from 51.50% to 51.00%, a change of 0.01 [3]

Group 1: Report Industry Investment Rating - Not provided Group 2: Core View of the Report - Domestic PTA plants have experienced concentrated breakdowns and maintenance, leading to a slight decline in domestic PTA production. The spread between PX and naphtha has widened, and the weakness of benzene prices has somewhat suppressed the further increase of PX production. The spread between PX and MX has rebounded, and the downstream load of polyester has remained at around 88%. The inventory of polyester factories is optimistic. The main polyester production cuts are concentrated in staple fiber and bottle chip varieties. With the recent improvement in sales and inventory reduction, polyester prices have performed well, especially the inventory of filament has been well reduced, sales have been continuously optimistic, and profits have been significantly repaired. Attention should be paid to the impact of subsequent device progress on the market [2] Group 3: Summary According to Related Catalogs 1. Price Changes - PTA spot price decreased from 4870 to 4835, a decrease of 35 [2] - MEG domestic price remained unchanged at 4553 [2] - PTA closing price decreased from 4870 to 4824, a decrease of 46 [2] - MEG closing price decreased from 4490 to 4481, a decrease of 9 [2] - 1.4D direct - spun polyester staple fiber price remained unchanged at 6680 [2] - Short - fiber basis increased from 103 to 118, an increase of 15 [2] - 9 - 10 spread decreased from 130 to 104, a decrease of 26 [2] - Polyester staple fiber cash flow increased from 240 to 246, an increase of 6 [2] - 1.4D imitation large - chemical fiber price remained unchanged at 5700 [2] - The price difference between 1.4D direct - spun and imitation large - chemical fiber remained unchanged at 980 [2] - East China water bottle chip price decreased from 5950 to 5926, a decrease of 24 [2] - Hot - filled polyester bottle chip price decreased from 5950 to 5926, a decrease of 24 [2] - Carbonated polyester bottle chip price decreased from 6050 to 6026, a decrease of 24 [2] - Outer - market water bottle chip price remained unchanged at 785 [2] - Bottle chip spot processing fee increased from 261 to 267, an increase of 5.93 [2] - T32S pure polyester yarn price remained unchanged at 10350 [2] - T32S pure polyester yarn processing fee remained unchanged at 3670 [2] - Polyester - cotton yarn 65/35 45S price remained unchanged at 16300 [2] - Cotton 328 price decreased from 15240 to 15215, a decrease of 25 [2] - Polyester - cotton yarn profit increased from 1110 to 1120, an increase of 9.45 [2] - Virgin three - dimensional hollow (with silicon) price remained unchanged at 7120 [2] - Hollow staple fiber 6 - 15D cash flow increased from 231 to 261, an increase of 29.93 [2] - Virgin low - melting - point staple fiber price remained unchanged at 7470 [2] 2. Market Conditions - Polyester staple fiber: The price of polyester staple fiber production plants was stalemate, the price of traders declined, downstream buyers were mainly on the sidelines, the purchasing willingness was low, and the on - site transactions were sluggish. The price of 1.56dtex*38mm semi - bright natural white (1.4D) polyester staple fiber in the East China market was 6450 - 6750 in cash, spot, tax - included, self - pick - up; in the North China market, it was 6570 - 6870 in cash, spot, tax - included, delivered; in the Fujian market, it was 6490 - 6600 in cash, spot, tax - included, delivered [2] - Bottle chips: The mainstream negotiation price of polyester bottle chips in the Jiangsu and Zhejiang markets was 5930 - 6050 yuan/ton, and the average price decreased by 25 yuan/ton compared with the previous working day. On the day, polyester raw materials and bottle chip futures fluctuated. The supply side's quotations were a mixture of stable and falling. Downstream terminals followed up cautiously, and the market transaction was cold. The price center of bottle chips declined [2] 3. Operating Rates and Sales - Direct - spun staple fiber load (weekly) decreased from 91.10% to 90.60% [3] - Polyester staple fiber sales decreased from 40.00% to 37.00%, a decrease of 3.00% [3] - Polyester yarn startup rate (weekly) decreased from 62.80% to 62.00% [3] - Regenerated cotton - type load index (weekly) decreased from 49.00% to 49.50% [3]

Group 1: Report Industry Investment Rating - No relevant information provided Group 2: Core Viewpoints - Commodity sentiment has weakened, PTA basis has weakened and trading volume has declined. Domestic PTA production capacity supply has contracted, and PTA port inventory has decreased. The spread between PX and naphtha has expanded to around $250, while the alkyl transfer and TDP profit margins are not optimistic. The spread between PX and MX has remained at around $90. In July, bottle chips and staple fibers are about to enter the maintenance period. Market port inventory has decreased, and polyester replenishment has improved under the weakening basis. Overall polyester inventory is not high, and polyester load has dropped to 88% [2] Group 3: Summary by Related Catalogs Spot Price Changes - PTA spot price decreased from 4825 to 4750, a decrease of 75 [2] - MEG domestic price decreased from 4503 to 4480, a decrease of 23 [2] - 1.4D direct-spun polyester staple fiber decreased from 6650 to 6600, a decrease of 50 [2] Price and Spread Changes of Polyester Staple Fiber - Short fiber basis increased from 136 to 140, an increase of 4 [2] - The 8 - 9 spread increased from 18 to 48, an increase of 30 [2] - The spread between 1.4D direct-spun and imitation large chemical fiber decreased from 900 to 850, a decrease of 50 [2] Price and Processing Fee Changes of Polyester Bottle Chips - Polyester bottle chip prices in the Jiangsu and Zhejiang markets decreased, with the average price dropping by 55 yuan/ton compared to the previous working day. The domestic and foreign prices of various types of bottle chips all decreased, and the bottle chip spot processing fee decreased from 386 to 359, a decrease of 26.83 [2] Price and Profit Changes of Polyester Yarn - T32S pure polyester yarn price remained unchanged at 10300, and the processing fee increased from 3650 to 3700, an increase of 50 [2] - The price of polyester-cotton yarn 65/35 45S remained unchanged at 16300, and the profit increased from 1297 to 1335, an increase of 38.82 [2] Load and Production and Sales Changes - Direct-spun staple fiber load decreased from 92.30% to 93.00%, a decrease of 0.01. Polyester staple fiber production and sales increased from 43.00% to 50.00%, an increase of 7.00%. Polyester yarn startup rate decreased from 66.00% to 65.00%, a decrease of 0.01. The regenerated cotton-type load index decreased from 51.50% to 46.00%, a decrease of 0.06 [3]

Report Industry Investment Rating - The investment rating for short - fiber (PF) is "oscillating weakly" [8] - The investment rating for bottle chips (PR) is "oscillating weakly" [5] Report's Core View - For short - fiber, market sentiment premium is released, and it shows a unilateral oscillating weak trend. Although downstream demand is expected to improve in mid - to late August, and the factory profit is near the cash - flow cost with neutral inventory, the tariff will still have an impact on exports in the medium - to long - term. In the future, there is limited room for further increasing production, and the processing fee is expected to expand as the peak demand season approaches [9] - For bottle chips, market sentiment premium is released, and it also shows a unilateral oscillating weak trend. After the production cut, the spot processing fee is still below the factory target. The demand support is strong, and the export disturbance is alleviated. However, there are pressure factors in the future, such as the increase in production after the end of the production cut and the demand situation in September - October [13] Summary by Relevant Catalogs Short - fiber (PF) Valuation and Profit - The current spot processing fee is 950 - 1000 yuan/ton, and the 09 - contract processing fee on the futures market is 850 - 900 yuan/ton. The processing fee below 900 yuan/ton is undervalued, and there is an upward momentum when the demand is expected to improve [10] Fundamental Operating Conditions - **Supply**: Based on low processing fees and inventory pressure, factories maintain high - level production. The average factory operating rate this week is 90.3%, and the operating rate of direct - spun polyester staple fiber for spinning is 94.7%. It is expected to remain stable or increase slightly in the future [9] - **Demand**: The operating rate of terminal weaving has bottomed out and is rising, but the short - term demand is still weak, and the short - fiber inventory has slightly accumulated. The 1.4D equity inventory is 10.4 days, and the physical inventory is 22.4 days. The demand is expected to improve in mid - to late August [9] Strategy - **Unilateral**: None - **Inter - period**: None - **Inter - variety**: Go long on PF and short on PTA, and go long on PF and short on PR when the price is low [11] Bottle Chips (PR) Upstream View Summary - The "anti - involution" policy may lead to cost increases, but has little impact on the supply of bottle chips due to the relatively small number of old - generation devices [12][17] Valuation and Profit - The current processing fee is 350 - 400 yuan/ton, which is moderately low and below the break - even line of most factories. It is expected to rise slowly as the spot supply tightens [13] Fundamental Operating Conditions - **Supply**: After the production cut, the processing fee has not risen above the factory cost. Factories are expected to maintain the current production - cut level until late August or the end of August. The total production capacity involved in the production cut by leading factories is about 2.4 million tons, and it has been fully implemented. The current operating rate is 79% [12] - **Demand**: The operating rate of domestic downstream industries remains high, and downstream enterprises replenish inventory at low prices. After the full implementation of the production cut, the bottle - chip inventory is expected to decline slightly from July to August. The factory inventory this week is about 18 days, remaining unchanged from the previous week [12] Strategy - **Unilateral**: There is pressure in the trend - **Inter - period**: None - **Inter - variety**: Go long on PF and short on PR when the price is low [14] Cost and Profit - The polymerization cost has decreased, and this week it is around 5550 - 5600 yuan/ton. The spot processing fee of bottle chips has remained stable this week, at around 380 - 400 yuan/ton. The export profit is oscillating weakly, and the internal - external price difference has narrowed [54] Inventory - The overall PTA inventory of polyester factories has decreased. The inventory of domestic polyester bottle - chip factories is 17.6 days (CCF data). The estimated social inventory at the end of June, July, and August is 3.07 million tons, 3 million tons, and 2.83 million tons respectively [59] Device Changes - The production cut is expected to last until late August or the end of August. For example, Chongqing Wankai plans to shut down 600,000 - ton production capacity for maintenance from July 5th for about one and a half months, and Yisheng Hainan has gradually shut down 1.25 - million - ton production capacity for maintenance since July 1st [65] Demand - **Downstream industries**: This week, the overall downstream operating rate has changed little. The operating rate of beverage enterprises has increased to 95 - 100%, the average operating rate of edible - oil enterprises is around 70 - 80%, and the operating rate of sheet - material industries in East China is around 60 - 80% and 40 - 60% in South China [69] - **Consumption situation**: From January to June 2025, the cumulative year - on - year growth rate of soft - drink production is 3.0%, and the cumulative year - on - year growth rate of beverage - category commodity retail sales is 0.6%. The consumption of beverages and edible oils is generally weak, which is related to the high base last year and the crowding - out effect of optional consumption on essential consumption [75] Export Situation - In June 2025, the total export volume of polyester bottle chips and slices is 657,000 tons, a year - on - year increase of 6.5%. From January to June 2025, the total export volume is 3.88 million tons, a year - on - year increase of 19%. Short - term disturbances include the impact of the US tariff renegotiation on re - exports from South Korea and Vietnam and the impact of the Turkish SASA's production on local exports [88] Supply - Demand Balance Sheet - From July to August, the supply - demand is in a tight - balance state, and inventory will start to accumulate again after September. Supply - side assumptions include that the production cut may last until the end of August, and new capacity will be put into operation in September. Demand assumptions include that downstream demand is estimated to increase by 5% year - on - year during the peak season, and export demand is expected to recover in August [100][102]

Report Overview - Report Title: Short Fiber and Bottle Chip Weekly Report - Report Date: July 27, 2025 - Analyst Team: Chen Xinchao, He Xiaoqin, Qian Jiayin Industry Investment Ratings - Short Fiber (PF): Short - term, the outlook is oscillating upward due to cost support [8] - Bottle Chip (PR): Short - term, the outlook is oscillating, with a weakening trend in the long - term [5][9] Core Views - Short Fiber: Cost support leads to a short - term oscillating upward trend. Demand is at the bottom and may oscillate at a low level in the short term. The most difficult seasonal period may have passed, with neutral inventory and profits above the cash - flow cost [8] - Bottle Chip: Cost support results in a short - term oscillating market. After production cuts are implemented, there is an expectation of inventory reduction from July to August, and processing fees have room to expand. However, there are still downward pressures in the long - term [9] Summary by Section Bottle Chip (PR) Upstream View Summary - "Anti - involution" policies may increase costs, but have little impact on supply as most bottle - chip devices are less than 10 years old, and the cost gradient among leading enterprises is narrow [12] Valuation and Profit - Current processing fees are between 350 - 400 yuan/ton, which is at a relatively low - to - neutral level and may gradually increase with the tightening of spot supply. Aggregate costs have risen, and export profits are oscillating weakly [49] Fundamental Operating Conditions - Supply: Leading factories have implemented production cuts, and the possibility of further cuts is low. The current operating rate is 79%. If processing fees are restored to the ideal level, restart may be advanced [9] - Demand: Domestic downstream operating rates remain high, and downstream enterprises replenish inventory when prices are low. Sea freight has declined, and the impact on exports from July to August has weakened. There is an expectation of inventory reduction from July to August [9] Inventory - Factory inventory remained flat this week. With the implementation of production cuts, inventory is expected to decrease. The overall PTA inventory of polyester factories has declined [54] Device Changes - Production cuts have been implemented as planned. Some factories have carried out maintenance, and there are no planned future maintenance devices for now [60][61] Demand - Downstream operating rates remain high. However, from January to June 2025, the performance of essential consumer sectors such as beverages and edible oils was generally weak. There are still many new production lines of beverage factories to be put into operation this year [70][71] Export - In the short term, exports are affected by sea freight, but the long - term trend is strong. In June 2025, the total export volume of polyester bottle chips and slices was 657,000 tons, a year - on - year increase of 6.5% [83] Anti - Dumping Policies - Multiple countries have implemented anti - dumping policies and investigations on Chinese bottle - chip products, which may have an impact on exports [94] Supply - Demand Balance Sheet - From July to August, the market is in a tight balance, and inventory will accumulate again after September. Supply - side assumptions include the possible continuation of production cuts until the end of August and the commissioning of new devices in September. Demand assumptions are based on a 5% year - on - year increase in the peak season compared to last year, and export demand is expected to recover in August [95][96] Short Fiber (PF) Valuation - The spot, basis, and monthly spreads have weakened. The processing fee on the disk is weak due to rising costs [100][104] Fundamental Operating Conditions - Supply: The operating rate of short - fiber factories remains high. The average operating rate this week was 90.6%, and the operating rate of direct - spinning polyester staple fiber for spinning was 94.7%. It is expected to remain stable or increase slightly in the future [8] - Demand: The operating rate of terminal weaving has bottomed out, but yarn production is still reducing due to high inventory. External demand orders will not be reflected until mid - to - late August. Short - fiber inventory is still healthy [8] Inventory - Downstream enterprises have replenished inventory intensively, and the inventory pressure has been relieved [115] Profit - With the decline in costs, most profits have been restored, but polyester chips are still in a loss - making state [123] Downstream Situation - The inventory pressure of polyester yarn is relatively large, and the operating rate is decreasing. Terminal enterprises have replenished inventory, but yarn inventory is still accumulating [131][133] Weaving Operating Rate - The terminal operating rate has bottomed out and is rising [144][147]

Report Information - Report Title: Short Fiber and Bottle Chip Weekly Report [1] - Report Date: July 27, 2025 [1] - Analyst: Chen Xinchao, He Xiaoqin; Contact: Qian Jiayin [1] Industry Investment Rating - Not provided in the report Core Views - Short fiber: Supported by cost, it is expected to fluctuate strongly in the short term, but there is still pressure in the medium term [7] - Bottle chip: Supported by cost, it will fluctuate in the short term, with a tight balance in July - August and restocking after September [8][94] Summary by Section Short Fiber (PF) Supply - Factory new production cuts are few. The average weekly factory operating rate is 90.6%, and the spinning direct - spun polyester staple operating rate is 94.7%, expected to remain or slightly increase [7] Demand - Terminal weaving starts to bottom out, but yarn is still reducing load due to high inventory. External demand orders will be reflected in mid - to late August. Short fiber inventory is healthy, with 1.4D equity inventory at 9.8 days and physical inventory at 21.7 days this week [7] View - Supported by cost, it fluctuates strongly in the short term. The demand side bottoms out and fluctuates at a low level in the short term. The most difficult seasonal time may have passed [7] Valuation - The current spot processing fee is 1,000 - 1,050 yuan/ton, and the 09 contract processing fee is compressed to 850 - 900 yuan/ton, with a slightly high - neutral valuation [7] Strategy - Unilateral: Roll long in the short - term range, with pressure in the long - term; Inter - period: None; Inter - variety: Take profit on long PR and short PF positions at high levels [7] Bottle Chip (PR) Supply - Leading factories' production cuts have been implemented, with a low possibility of further cuts. The current operating rate is 79%. If the processing fee recovers, restarts may be advanced [8] Demand - Domestic downstream demand remains high, and downstream restocks on dips. After the production cuts, bottle chips are expected to have a slight destocking pattern in July - August [8] View - Supported by cost, it fluctuates in the short term. The destocking expectation in July - August is considerable, and the processing fee still has room to expand, but there is pressure in the long term [8] Valuation - The current processing fee is 350 - 400 yuan/ton, which is neutral - low and expected to rise slowly [8] Strategy - Unilateral: Roll long in the short - term range, and short at high levels in the long - term; Inter - period: None; Inter - variety: Take profit on long PR and short PF positions at high levels [8] Other Aspects - "Anti - involution" impact: It may increase costs, but has little impact on supply [11] - Sea freight: It has decreased, and the impact on exports in June - July has weakened [16] - Base and spread: The basis and inter - month spread have weakened as the futures price rises faster than the spot price [21][99] - Price and spread: The price has risen this week, and the FOB price is 800 - 815 US dollars/ton. The substitution spread shows different trends [24][27] - Production and operation rate: The effective production capacity has reached 2,168 million tons, and the current operating rate has dropped to 79.7% [32] - Raw material operation: PTA has slightly increased inventory, and MEG has seen changes in load and inventory [43][44] - Cost and profit: The polymerization cost has risen, the processing fee has stabilized, and the export profit has weakened [48] - Inventory: Factory inventory has remained flat this week, and destocking is expected after production cuts [53] - Device changes: Production cuts have been implemented as planned, and no future major device overhauls are expected [59][60] - Demand - Downstream load remains high, with beverage, edible oil, and sheet material industries showing different operating rates [63] - 2025 Q1 - Q2 beverage consumption was weak year - on - year, but there are new production lines to be put into operation [69][70] - Edible oil demand is neutral, and sheet material demand is average, with improved supermarket consumption [72][75] - Global trade flow: Overseas demand increasingly depends on imports, and China's main export flows are to Southeast Asia, South Asia, Central Asia, and other regions [79] - Export situation: In June 2025, the export volume was 657,000 tons, a year - on - year increase of 6.5%. There are short - term disturbances but a strong long - term trend [82] - Anti - dumping policy: Multiple countries have implemented anti - dumping policies on Chinese bottle chips [93] - Supply - demand balance: A tight balance in July - August and restocking after September, with assumptions about supply and demand [94][95]