Orient Securities: Can the polyester filament leader reach a new profit center

The Zhitong Finance App learned that Orient Securities released a research report saying that under the influence of the Middle East crisis, despite poor supply and demand conditions, the profitability of the polyester industry has increased significantly. The bank believes that business strategy adjustments are gradually beginning to play an important role. The polyester filament industry chain underwent active business strategy adjustments under the crisis, making the industry's profitability bucked the trend. If this adjustment is prolonged, it is expected to bring the profit level of filament and PTA to a new level.

Orient Securities's main views are as follows:

The industry operating cabinet is being broken through

Leading polyester filament companies have continued to improve their level of integration over the past few years. They have experienced the process of direct melt spinning instead of slice spinning, building their own PTA devices, improving PTA competitiveness, and building a PTA - filament integrated base with a big chemical mindset. Leading companies continue to increase their share in filament and PTA with competitive advantages leading to industry breakthroughs. As of 2025, the two major filament companies accounted for nearly half, and the PTA's four leading companies accounted for two-thirds. However, the increase in the competitiveness and share of leading companies has instead led to a decline in the profit center of the industry and a reduction in industry volatility. As can be seen from the price difference fluctuation graph, from 2023 to 2025, the price difference between polyester filament and PTA was limited to a relatively narrow box. However, since this year, under the influence of the Middle East crisis, the profitability of the industry has improved markedly despite poor supply and demand conditions. The bank believes that business strategy adjustments are gradually beginning to play an important role.

Different responses in times of crisis

This round of the Middle East crisis has had a huge impact on supply and demand unlike before. In the PTA process, the supply of raw PX began to decline in April of this year due to the conflict in the Middle East, and PTA companies promptly and actively adjusted operating rates to maintain the industry's profit level. However, many similar products generally performed poorly during the same period. For example, the pure phenyladipic acid chain, the decline in the operating rate of adipic acid was clearly not as high as that of upstream pure benzene, causing the profitability of adipic acid to decline significantly after the conflict. In the polyester filament sector, the bank believes that in addition to adjusting the operating rate, the pricing strategy has also been adjusted. Compared with the Russian-Ukrainian conflict in 2022, the filament chain also maintained a good level of profit in 2026 when the downstream took the initiative to remove warehouses significantly and demand performance was even worse. If the business strategy adjustments that occurred during this crisis can be prolonged, it is expected that the profit center of leading companies will reach a new level.

Risk Alerts

Changes in the macroeconomic situation; errors in production capacity statistics; changes in assumptions affect the calculation results.