The price of viscose staple fibre (VSF) in China continued with its downward trend in November. VSF (1.2D/38mm) traded at about 16,940 yuan/ton by November-end, a decline of about 1,800 yuan/ton or 9.61 percent, from a price of 18,740 yuan/ton in early November.
The decline in VSF price to record low levels in November, in turn, increased the bearish sentiment of VSF manufacturers. Also, downstream rayon yarn manufacturers sharply cut production, and the market entered into a stalemate at one point.
There are two chief reasons for continued decrease in price of VSF. First, the reduction in export orders due to the ongoing debt crisis in Europe, which led to a slump in export orders that resulted in reduced purchase of raw materials by end-consumers. Second, as the end of the year is approaching, there has arisen a problem of 'capital' for VSF manufacturers. This has forced some of them to sell products at low cost to reduce their inventory pressure.
Fibre2fashion News Desk - China
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