Enhancing Futures Tool Utilization to Promote Polyester Industry Enterprises Going Global

On August 20, the 2025 China (Zhengzhou) International Futures Forum Sub-forum "Industrial Products (Polyester) Forum" was held in Zhengzhou. Representatives from exchanges, industry associations, domestic and international enterprises, and financial institutions engaged in in-depth discussions on the theme of "How the Futures Market Can Help the Polyester Industry Go Global."

The robust development of the polyester industry chain relies on the support of futures instruments.

"The robust development of the polyester industry chain is inseparable from the assistance of futures instruments. In 2006, the first domestic chemical futures product, PTA futures, was listed on the Zhengzhou Commodity Exchange (ZCE), providing a price discovery and risk management tool for polyester industry chain enterprises. Subsequently, ZCE successively listed futures and options for staple fiber, PX, and bottle-grade polyester chips, achieving full coverage of major products in the polyester industry chain. This further enriched the futures instruments system and significantly enhanced the ability to serve the industry. Since the listing of polyester futures and options, the market has generally operated smoothly, and their functions have been effectively utilized. They have played a positive role in guiding enterprises in arranging production plans, assisting in managing price fluctuation risks, stabilizing operations, and locking in profits. These tools have helped enterprises form a risk management loop from raw materials to products, thereby enhancing the international competitiveness and influence of China's polyester industry," said Jin Gaoling, Vice President of the China Chemical Fibers Association.

A relevant person in charge at the Zhengzhou Commodity Exchange stated that the risk management tool system for the polyester industry chain, which the exchange has continuously developed, has basically taken shape. Currently, the polyester sector has become a star segment in China's futures market, characterized by a complete range of industry chain products, large market scale, strong functionality, and high industry recognition.

In the construction of the polyester sector, Zhengzhou Commodity Exchange (ZCE) has focused on advancing three main areas of work and has achieved significant results. First, it continuously increases the variety of products supplied, enriching the risk management toolbox for the polyester industry. To enhance the futures market's ability to serve the polyester industry, ZCE has successively listed eight products, including PTA, staple fiber, PX, and bottle-grade PET futures and options, building a comprehensive tool system for the polyester sector. This effectively assists related enterprises in achieving a risk management loop from raw materials to finished products. Second, it employs multiple measures to strengthen industry services and integrate the futures and spot markets deeply. By adhering to the needs of industry clients, ZCE has launched the PTA export-oriented vehicle (ship) delivery system, added warehouse delivery methods for staple fiber futures, optimized the application process for hedging position limits for polyester products, and introduced three sets of inter-product arbitrage instructions, such as PTA-staple fiber, better meeting the risk aversion needs of industry enterprises. Currently, the vast majority of polyester companies are deeply involved in the polyester sector's products, effectively managing risks and stabilizing profits. Third, it deepens opening up to the outside world, steadily enhancing the international influence of futures prices. On the basis of the opening up of PTA futures, ZCE has promoted the introduction of qualified foreign institutional investors for all eight products in the polyester sector. By the end of July, a total of 760 overseas clients from over 30 countries and regions have opened accounts, and the prices of PTA and PX futures have become important references for relevant international trade pricing.

The relevant person in charge of Zhengzhou Commodity Exchange (ZCE) stated that the next step for ZCE is to continue to serve the building of a manufacturing powerhouse and contribute futures market power to advancing new industrialization. The key tasks are as follows: 1. Refine and enhance existing products. Conduct in-depth industry research, fully listen to the opinions of different types of enterprises along the industry chain, and continuously improve contract rules and optimize delivery arrangements based on industry development and enterprise needs to further facilitate enterprise participation. 2. Expand opening-up. Promote short fiber, PX, bottle-grade PET futures and options, and PTA options to become specific products. Adhere to the "one product, one policy" approach to design opening-up plans and promote the landing of the first business of PTA export-type vehicle (ship) board delivery, further enhancing the international influence of China's futures prices. 3. Solidly provide industry services. Adhere to the philosophy of "keeping the trouble to ourselves, leaving convenience to the market," understand the difficulties and pain points in the operation of real enterprises, and collaborate with government departments, industry associations, industry-finance bases, and futures companies to leverage their respective advantages to help enterprises better utilize the futures market and improve operational quality and efficiency. 4. Strengthen supervision and risk prevention. Enhance monitoring and supervision of market operations, strengthen risk assessment, uphold frontline regulatory responsibilities, and strictly crack down on various illegal and irregular activities to ensure the stable operation of the futures market.

"At present, a considerable proportion of industrial chain enterprises have established a relatively systematic futures research and application system. It is hoped that relevant industrial enterprises will take this forum as an opportunity to deepen the exchange and sharing of hedging experiences, continuously improve the ability to use futures tools, strengthen the risk control defense line, and promote the steady and long-term development of enterprises," said Jin Gaoling.

PTA is steadily progressing, with significant achievements in opening up to the outside world.

As of the end of July 2025, a total of 760 overseas clients from more than 30 countries and regions have opened accounts in China's futures market. Some of the world's leading physical traders in the energy and chemical industry participate in PTA and other futures through their domestic subsidiaries, fully demonstrating the trust and deep involvement of international industrial clients in China's futures market.

Mr. Liu Dewei, General Manager of Xiamen International Trade Petrochemical Co., Ltd., introduced the journey of how the listing of the "four polyester brothers" (PX, PTA, short fiber, and bottle-grade PET) futures and options on the Zhengzhou Commodity Exchange (ZCE) has supported real enterprises. He summarized four characteristics: early start, comprehensive range of products, effective functions, and high recognition. The futures-spot hedging model vigorously promoted by the ZCE has been deeply integrated into the daily operations and import-export activities of enterprises within the polyester industry chain.

"By using the futures market to establish a virtual bottle chip processing plant for export stocking and employing the futures basis formula for pricing to provide overseas customers with a secondary pricing opportunity, these two cases demonstrate that utilizing futures and options tools for Chinese polyester products to assist in export quotations can effectively optimize the storage and logistics costs of Chinese polyester products. While achieving a win-win situation with overseas customers, it also ensures the global market share of Chinese polyester products and enhances their international pricing capability and competitiveness," said Liu Dewei.

The openness of the other party is the inevitable path for China's polyester industry as a whole to shift from being a price taker to a rule maker.

"Currently, China's PX production has significantly increased, and the output of bottle-grade chips and short fibers is also continuously rising, all facing opportunities for internationalization. With the Zhengzhou Commodity Exchange launching financial risk management tools covering the entire industry chain, including PTA, PX, bottle-grade chips, and short fibers, our influence in the overall product pricing is continuously growing," said Xu Ji'en, Deputy General Manager of the Sales Center at Yisheng Petrochemical.

Risk management is the lifeline of modern enterprises.

In the face of a complex and ever-changing external environment, closed-loop management through proactive prevention, real-time control, and post-event hedging is especially important. Currently, the polyester futures segment created by the Zhengzhou Commodity Exchange is the most well-supported segment in China, providing industry chain enterprises with a more comprehensive "toolbox" for risk management and further enhancing the resilience of their operations.

PTA, as the earliest listed futures product in the polyester chain, is one of the products with the highest integration of futures and spot markets, with a hedging efficiency of over 98%. As a major supplier, Yisheng Petrochemical is a practitioner of this integration.

"Enterprises participate in futures mainly through hedging, including buying hedges and selling hedges. We are both a PTA production enterprise and a bottle chip production enterprise, so we have demand for both buying and selling," said Xu Ji'en. For enterprises, as market competition intensifies, single hedging opportunities are relatively scarce. As PTA is a product that connects the upstream and downstream of the aromatics industry chain, when hedging, enterprises need to pay attention to the processing fees at each link of the entire industry chain, as well as the price ratio between domestic and foreign markets and the inter-month spread situation.

Shi Hangqi, the department manager of the Basic Chemicals Division I at Rongsheng Petrochemical, introduced that in the past, Rongsheng Petrochemical’s risk management for PX operations mainly focused on two aspects: First, flexibly adjusting the product flow of its integrated refining and chemical facilities according to market changes, and dynamically managing PX inventories to hedge against risks; second, establishing an integrated industrial chain of “crude oil—PX—PTA—polyester” to leverage upstream and downstream synergies and effectively offset the risks brought by price fluctuations of a single product. With the development of the futures market, the company has added new risk management approaches such as utilizing financial instruments in the futures market for hedging and locking in processing fees, further enriching its means of risk mitigation.

As a leading company in the short fiber industry, Xin Feng Ming Group has successfully established a comprehensive dynamic risk control system encompassing "raw materials—finished products—inventory." Qian Jiafeng, the head of the Industry Research Department at Xin Feng Ming Group, explained that the company has effectively utilized the futures market to optimize procurement, secure profits, and hedge against price fluctuation risks. "In terms of inventory management, we have innovatively adopted a storage system that combines vertical and flat warehouses, allowing us to calmly handle scenarios such as the off-season during the Spring Festival and abnormal sales. Additionally, we closely integrate our two short fiber factory warehouses, leveraging the unique advantages of factory warehouse delivery to effectively mitigate potential risks," stated Qian Jiafeng. Through comprehensive dynamic risk management, the company has enhanced its profitability and market competitiveness.