Indonesia Overtakes Pakistan As Second Largest Importer Of China's PSF

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Indonesia Overtakes Pakistan As Second Largest Importer Of China's PSF

Direct-spun PSF exports directly from Chinese producers in the first three quarters totaled 410kt, an increase of 4.7% year on year. The export in the first quarter declined year on year, but the picture in the following two quarters turned better, particularly in the third quarter when the export growth reached as high as 15% over the previous year.

Indonesia, overtaking Pakistan, became the largest destination of China's direct-spun PSF exports this year. Meanwhile, the exports to US also grew fast with proportion only 0.8% less than Indonesia's.

A closer look at export data to Indonesia and Pakistan showed that from January to September, direct-spun PSF exports directly from the producers to the former totaled 66.8kt, an increase of 28.8kt year on year or 75.8%, while to the latter totaled 50.9kt, a reduction of 37.8kt or 42.6%. In August and September, the export volume to Indonesia was two times more than that to Pakistan. Exports to Pakistan stood low since the anti-dumping duty has been levied on China's PSF exports. Exports to Indonesia grew despite the country's anti-dumping policy in mid-2016 as Jiangsu Sanfangxiang was free from this policy. Sanfangxiang shared 75% of its imports of direct-spun PSF.

Direct-spun PSF demand increased amid fluctuating cotton prices. Though the PSF imports of Pakistan slumped, it may to some extent be due to the substitution of polyester yarn imports by local downstream plants. And it was reported that polyester yarn exports of yarn mills in Indonesia increased.

China's domestic exporters also changed. From January to September, Sanfangxiang, surpassing Jiangsu Huahong became the largest exporter, and exports of Fujian Jinlun also increased after the business strategic adjustment on export.

What's more, the price gap between Sanfangxiang and Huahong enlarged as the two performed divergently in export markets and in turn gave them different stimulus in the domestic market.