Chemical fiber industry portrays a bleak future

28 Apr '08

2 min read

After experiencing a steep price rise in 2007, the chemical fiber industry no longer enjoys a bright prospect in the present session, as prices of major chemical fiber varieties saw a sharp fall. VSF price dropped nearly to 18,000 yuan from its original cost.

Market insiders expect that under the backdrop of reduced orders from domestic textile processing industry, chemical fiber sector will see further decline in its prices.

Since 2008 starting, due to the impact of accelerated expansion of production capacity and slow demand from downstream sector, prices of chemical fiber products, especially viscose and spandex have shown weakness. Although, product inventories have increased, profits have kept falling.

Relevant products of viscose and spandex indicate clear decline from high points; by the end of March, VSF price fell below an important support juncture of 20,000 yuan per ton and viscose filament market condition is not optimistic either. Prices of spandex products mark a significant decreasing trend.

Statistics show that at present viscose filament price has been stabilized at the level of 34,000 yuan per ton for more than six months. VSF price reached the mark of 22,200 yuan per ton by the end of October 2007, and then started to decline slowly at a pace of 100-200 yuan per week; it has recently fallen below 20,000 yuan per ton. Now, when the present cost price has touched 18,000 yuan per ton, the market is engulfed with a panic psychology.

Price of spandex 40D started to plunge since it reached 95,000 yuan per ton by March end 2007, and by end of the year, it fell to 70,000 yuan per ton. In the present year as well, spandex price continued its downtrend and dropped to 62,000 yuan per ton by the end of February.

The industry experts believe that the future of spandex is at risks and prices of these products will further see a plunge.

Fibre2fashion News Desk - China

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