Viscose fiber prices have begun sharply falling in China after cotton and polyester prices have started sliding. New capacities are expected further depressing prices in the coming period whatever the fall of margins at fiber plants. 100% viscose and poly-viscose yarn prices are also falling.
Viscose staple fiber prices have begun more sharply declining in the past days, in line with a fall of cotton prices on the domestic market in China.
Benchmark 1.5D VSF has lost 500 yuan per metric ton or more than 4% in only seven days, ending at 11,800 yuan per metric ton.
A few weeks ago, the market was still expecting a strong support at 12,000 yuan.
Demand is not strong enough, with a fall of cotton and polyester prices now making viscose less competitive.
The benchmark indicator can now be expected testing the level of 11,500 yuan in absence of strong demand from downward processors.
Additional capacities are also expected being launched in the coming period which would further depress market prices.
Producers are now trying to keep their shares of the market or to expand them, rather than to preserve their already thin margins.
New financial difficulties at weakest companies could result in a market concentration, as already observed with Sateri’s acquisition of the past weeks.
Lower yarn rices
Spun yarn prices have rapidly followed the fall of fiber prices and could continue dropping in the coming period.
In Qianqing, 100% viscose prices have lost 150 yuan while poly-viscose prices were even sliding 150 to 350 yuan depending on counts.
Source: Emergingtextiles
