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Negative price spread between VSF & cotton narrows
19
Aug '11
Cotton pulp and viscose prices had bottomed out in the first fortnight of July. On the other hand, domestic cotton grade 328 too fell by 17 percent in July and is still continuing on a downward trend and has now fallen below 19,800 Yuan / ton.

But since mid-July prices of cotton pulp and viscose staple fiber have slightly rebounded and the negative price spread between viscose staple fiber (VSF) and cotton has continued to narrow from 5,000 Yuan / ton to the current 1,500 Yuan / ton.

Since mid-July, the spread of cotton pulp has widened, while the spread of viscose staple fiber has stabilized. With current prices of viscose staple fiber at 18,000 Yuan / ton and cotton pulp at 11,000 Yuan / ton, industries began to turn around.

With new cotton arriving in the market in September and with increased operating rates, it is expected that profitability level of viscose staple fiber industry will gradually improve.

Fibre2fashion News Desk - China

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