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Insight | Time: Jun 23 2022 1:27PM  Editor:Tina Kong
China's PFY exports increase more than expected in May
 
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According to the data from the Ministry of Transport, the container throughput of key monitoring ports nationwide reached 23.08 million TEUs in May, an increase of 4.2% over the same period last year, with an average daily increase of 4.4%. Among them, the container throughput of Shanghai Port reached 3.4 million TEUs, an average daily increase of 7% compared with the previous year; Ningbo Zhoushan Port completed more than 3.3 million TEUs, and the container throughput reached another all-time high.


Driven by the rapid recovery of shipping, the delivery of early backlog of containers was concentrated, helping PFY exports hit a new high of May, ranking fourth over the years. According to the data from China customs, exports of PFY were at 298kt in May, up 26.6% on the month and 39.1% on the year respectively. PFY exports amounted to 1313kt in Jan-May, 2022, down 4.98% on annual basis, with y-o-y reduction down by 8.08% over Jan-Apr.

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Exports of PFY by variety in May (Unit: tons)
Variety  Export in May MOM change YOY change YOY change of Jan-May exports
POY (54024600) 46230 28.60% 21.40% -38.20%
FDY (54024700) 45713 23.10% 52.30% -13.20%
DTY (54023310) 146830 28.20% 59.90% 15.00%
PIY (54022000) 49097 19.20% 3.30% -1.80%
Textured yarn (54023390) 7857 65.80% 63.80% 21.30%
Other PFY (54025200) 2018 22.70% 12.40% 12.70%


Reasons for more-than-expected growth rate of PFY in May: low PFY exports in May 2021 and stagnated goods in Mar-Apr amid the pandemic. The logistics circulation recovered in Jun compared with May, while the export growth rate is expected to reduce greatly. Reflected by factories and traders, export orders of PFY have been apparently worse than May since mid-Jun. However, as some orders were not delivered earlier, exports of PFY are estimated to sustain yearly high in Jun.


Top 10 export markets of PFY in May 2022 (Unit: tons)
Destination Export volume MOM change YOY change Proportion
Brazil 37217 103.90% 242.50% 12.50%
Vietnam 34711 52.60% 51.50% 11.70%
Pakistan 27951 2.80% 81.00% 9.40%
India 24633 61.50% 75.30% 8.30%
Turkey 22852 -14.70% -13.00% 7.70%
South Korea 19817 60.60% 37.90% 6.70%
Egypt 18408 38.80% 26.90% 6.20%
Indonesia 12968 110.20% 75.60% 4.40%
Bangladesh 12061 -8.50% 12.20% 4.10%
Mexico 7590 -2.40% 56.90% 2.50%


Major export destinations of PFY changed a lot in May. Brazil soared to the top one, with DTY export to Brazil at 30.3kt, which accounted for 20.6% of the total DTY export. Vietnam ranked the second place. Exports of FDY to Vietnam took up 24.8% of the total FDY export in China. Exports of DTY to Vietnam were only next to Brazil and Pakistan. Exports of POY to India surged to the first place, accounting for 27.9% of the total POY export, and exports of FDY to India were only next to Vietnam.

 

Exports of PFY to Pakistan and Bangladesh were good in Jan-May but weakened obviously in Jun mainly due to substantially volatile exchange rate. On Jun 21, the Pakistani rupee fell 1.3 rupees against the dollar to close at 206.46, another all-time low, according to data from the National Bank of Pakistan on the 15th local time.

 

Indonesia should be concerned. As for the structure of exported PFY in May, the increase of POY was prominently higher than other varieties. Many customers reflected that local DTY price in Indonesia has been very close to the price in China in Jun. Indonesia may continue increasing importing POY from China later.

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The freight of Red Sea route surged to high level in early-Jun and started falling. The freight offer from Ningbo port to Egypt/SOK dropped to near US$8,600/40HQ this week, down by around $1000 compared with early-Jun, that to Indonesia/Jakarta slipped to US$2,500/40HQ, down by around $500 over early-Jun, and that to Brazil (NAV) was at US$8,600/40HQ, at US$8,300/40HQ in actual transactions, which increased by more than $1,000 compared with the beginning of Jun and up by above $2,000 over early-May.

[RISK DISCLAIMER] All opinions, news, analysis, prices or other information contained on this report is provided by analyst of Zhejiang Huarui Information Consulting Co., Ltd (CCFGroup) as general market commentary and does not constitute investment advice. CCFGroup will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
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