SunSirs: Weak Demand in June, but Prices of Viscose Staple Fibers Rose Up

https://www.chemnet.com   Jul 02,2024 SunSirs

Although June is the off-season for textiles and the downstream demand side is weak, the inventory of viscose short fiber enterprises is tight, coupled with increased costs, and factories have a strong reluctance to sell at low prices. The market prices are strong and improving, and manufacturers have reported an increase in prices.

The price trend of viscose staple fiber

According to the commodity market analysis system of SunSirs, the price of viscose staple fiber increased in June. As of June 30th, the domestic factory quotation for 1.2D * 38mm viscose staple fiber was 13,420 RMB/ton, an increase of 200 RMB/ton from the beginning of the month's price of 13,220 RMB/ton, with a monthly increase of 1.51%.

Analysis review

In terms of supply, the production of viscose staple fiber factories had remained stable, with an industry operating load rate of around 78%. Some orders for viscose staple fiber factories had been signed until mid to late July, but shipments  were still tight, which had a positive impact on the market.

In terms of cost, the price of main raw material dissolved pulp remained relatively high, with domestic enterprises referring to 7,600-7,800 RMB/ton for broadleaf dissolved pulp and 940 US dollars/ton for external prices. The price of auxiliary raw material sulfuric acid continued to rise, providing favorable support for the cost of viscose short fibers. The viscose staple fiber industry was in a narrow range of losses, and factories were reluctant to sell at low prices.

In terms of demand, there had been no improvement in terminal demand, and the profits of downstream cotton yarn factories had been compressed. There was a strong resistance to the price increase of viscose short fibers, and the downstream cotton yarn market was relatively weak in keeping up with the rising raw materials. They purchased viscose short fibers on demand.

Market outlook

The weak terminal demand continued, and downstream human cotton yarn factories had a low operating rate. The human cotton yarn market may not be hot, and with the arrival of high temperatures, downstream human cotton yarn factories also had the possibility of reducing production. The demand for viscose short fibers lacked positive support. However, some viscose staple fiber factories had relatively sufficient orders, and the reluctance to sell at low prices may still exist, resulting in relatively firm quotations. The inventory of viscose staple fiber enterprises may remain at a low level in the short term, and the tight delivery situation of viscose staple fiber factories may not be easy to change in the short term, which has a boosting effect on the market. The market price of raw material dissolution pulp remains stable, providing stable support for the cost end of viscose staple fibers. Overall, it is expected that the market for viscose staple fibers will remain stable in the short term, with prices expected to be in the range of 13,400-13,500 RMB/ton.

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