Middle East conflict pushed up prices of down jackets? Polyester surged over 2,000 yuan/ton overnight, some fabric manufacturers suspended order taking

Whale News, March 13 (Reporter Tang Shiyun) — The conflict in the Middle East continues, affecting thousands of miles away in a tangible and prolonged way. International oil prices have surged, leading to widespread increases in key textile raw materials such as chemical fibers and dyes. As a result, some netizens on social media lament, “The Middle East war has shattered the clothing industry.”

Amid the impact, some factories are experiencing record orders, while others have paused accepting new orders due to uncertainty. Several industry insiders comment, “Who knows what the prices will be tomorrow?”

So, will your fall and winter jackets see a price increase? Surprisingly, despite raw material prices soaring, some manufacturers have actually lowered their finished garment prices.

Raw material prices are on a “roller coaster”: overnight increases of over 2,000 yuan/ton, with fabric manufacturers suspending orders

Affected by the Middle East situation, international oil prices have jumped sharply. Many textile-related chemicals such as polyester fibers, nylon, spandex, and even cotton are downstream products of petrochemical industry. Data shows that chemical fibers account for over 70% of modern textiles, causing significant fluctuations in the clothing industry.

Several clothing and fabric manufacturers confirmed to Whale News that recent price increases involve materials related to oil, including polyester (polyester fiber), nylon, spandex, and even cotton. Polyester prices surged by over 20% overnight, nearly increasing by 2,000 yuan/ton.

Price increase notices from suppliers / Photos provided by interviewees

An industry insider said they have received many price increase notices from suppliers recently. Material quotes are updated almost daily, only stabilizing somewhat yesterday. The price increases vary across different fabrics, and overall production costs may have increased by about 8%.

Some macro data reflect the volatility in raw material prices. According to Global Textile Network, the current polyester staple fiber price is about 7,456 yuan/ton, up more than 10% from the end of last month’s 6,630 yuan/ton. On March 10, polyester staple fiber prices surged over 25% overnight, fluctuating by 2,000 yuan/ton. Subsequently, prices dropped sharply by 18%, causing industry jitters.

Almost all core materials are on a “roller coaster,” which will inevitably impact downstream actions and production progress. An interviewed clothing factory owner said the impact is obvious: “Some clients were supposed to visit our company, but now their plans have changed.”

More than one industry insider mentioned that most companies prefer not to raise prices with long-term clients if possible. However, since the beginning of the year, yarn prices have already risen once, and this current upward trend may be difficult to absorb.

Fabric suppliers said that some factories with stockpiles have experienced a surge in orders. They have also recently adjusted new quotes, but due to extreme raw material fluctuations, they are no longer accepting new orders. They already have many orders from years past, and without stockpiled yarn, they would incur losses. “We’re worried that current prices are artificially high, and constantly adjusting prices isn’t good for clients. Accepting new orders could cause more trouble.”

One fabric supplier mentioned that their clients, due to relatively high order values, can accept current price increases. However, downstream clients generally order only what they need and are not stockpiling in large quantities. “Market fluctuations are too big; everyone prefers stability.”

Some social media users lament, “This price surge is really hard to handle; we can only hope for TACO.” TACO stands for “Trump Always Chickens Out,” implying that Trump always backs out at the last minute.

No one knows how oil prices will change tomorrow, but apparel industry players are likely paying more attention to international news than ever before.

Production costs for fall/winter clothing, outdoor gear, and sun-protective clothing may be affected, but finished garment prices are not necessarily going up

Which types of companies or clothing categories will be most impacted?

Luo Lihong, an industry insider, told Whale News that this is currently one of the traditional peak seasons for the textile industry. For export companies, first-quarter orders can account for 40% of annual sales — so this surge in raw material prices could have a greater impact on foreign trade apparel companies.

In terms of clothing categories, functional fabrics like outdoor jackets and sun-protective clothing based on polyester and nylon will be significantly affected.

However, cost transmission to end consumers has a time lag, as clothing companies usually place orders one quarter or half a year in advance. Most spring and summer orders are already produced (some summer products may still be in production), and some interviewed factories are already developing fall/winter new styles.

Shanghainese brand strategy consultant and founder of Liangqi Brand Management Co., Cheng Weixiong, believes that if the US-Iran conflict persists, the production costs of fall/winter clothing will be hard to avoid. But by the time fall and winter arrive, the war might be long over, and the market may not accept premium pricing.

For businesses along the supply chain, raising prices is not easy. A clothing factory owner told Whale News that distributors are under pressure, and orders are decreasing. Even with little profit, they dare not raise prices. For example, recently, despite rising costs, their finished garment prices have been cut by 3-5%.

The difficulty faced by different-sized manufacturers in this cost transmission process varies.

Cheng Weixiong pointed out that some brands with pricing power might raise their finished garment prices in response to increased production costs. However, many larger companies, capable of absorbing cost increases, tend to avoid raising prices. They often stockpile materials or lock in raw material costs through long-term fabric contracts and futures hedging.

Small and micro enterprises may face greater risks of inventory clearance, as they often lack sufficient funds to stockpile materials and may not have strong pricing power. But this isn’t necessarily a dead end; companies might shift toward cotton-linen, new materials, or higher-tech sectors.

“Overall, I think this is likely a short-term fluctuation, and the industry’s self-repair ability remains strong. If one path is blocked, just take another,” the interviewee summarized.