The acrylic fibre market in China has gone through three stages in the first half of the current year.
At the beginning of the year, the prices of acrylic fibre began increasing on expectation that demand would rise. The rising trend continued until March.
From April onwards, acrylic fibre market in China witnessed a consolidation stage. While prices rose to high levels in spot market, downstream market was not eager to purchase at higher levels. So, the market entered a consolidation phase and prices remained stable for some time.
From mid-April, there was continued weakness in demand and manufacturers of acrylic fibre reduced their production. Owing to a decline in sales, stocks started increasing and offer prices of acrylic fibre declined sharply. The market thus entered a stage of bearish accumulation.
By June-end, price of acrylic staple fibre dropped to 15,400 Yuan/ton, showing a dip of around 30 percent from the highest level witnessed earlier during the year.
In early August, discussions for spot supply of acrylic staple fibre were in the range of 17,000-17,500 Yuan/ton. However, no substantial increase in production or sales was witnessed due to lack of demand from downstream yarn market.
The price of acrylic fibre is likely to rise to about 18,500 Yuan/ton in September. Subsequently, the market may enter a consolidation phase in October.
In short, the Chinese acrylic fibre market is likely to rise further in short term. However, the outlook for medium and long-term remains cautious.
Fibre2fashion News Desk - China