The price of crude oil has continued to rise some time ago, causing the prices of most raw materials to continue to rise. However, the price of spandex has not increased but has dropped by 500 yuan/ton. Since February, the price of spandex yarn has dropped by 3,000 yuan/ton.
Since the end of February, the price of spandex yarn has basically entered a continuous downward trend. The good expectations in the early stage have completely turned into bubbles. Now that the peak season is coming to an end, there is little room for price increases in the later period. As a “good brother”, Nylon couldn’t help but ask: We agreed to advance and retreat together, but why did you stop falling instead of rising?
The disadvantages outweigh the advantages and it is no longer popular.
When it comes to the peak moment of spandex products, it will be in 2020. Basically, if you ask all the textile bosses in the market, they will say that four-way stretch is a hot seller. However, in the past two years, it was also due to the hype of spandex yarn. It was originally small and transparent. It has also become active in the market, and of course the price that has increased in a short period of time has to be paid back.
Spandex yarn is not like nylon yarn. Its usage in textile fabrics is very small, only 3%-10%. Therefore, unless the spandex-containing products are super popular, the price of spandex yarn will rise. However, elastic fabrics such as four-way elastic have not been used in recent years. It has been replaced by some stretch fabrics that do not contain spandex. Spandex products are not easy to store. Once left for a long time, spandex filaments will break. When the cloth is sold, no one may want it. In addition, spandex filaments are expensive. Nowadays, many elastic fabrics are not only high-quality but also low-priced, but also include spandex fabrics, which makes the demand for spandex products in the market smaller, and naturally the price cannot go up.
Production capacity increases but demand does not increase
The new spandex production capacity increased significantly in the first quarter of 2023. Driven by the acceleration of shipments and the recovery of cash flow in the first quarter, the new spandex installations that were delayed last year were accelerated. The industry supply is still increasing steadily, and the spandex industry has a relatively sufficient load. However, on the demand side, there was a large inventory of low-priced raw materials in the early stage of digestion in March. The production and sales pressure of spandex factories increased, and the high fluctuations in conventional inventories were not effectively digested. The market’s bearish mentality increased, and the oversupply situation continued.
The output of the domestic spandex industry is expected to reach 225,000 tons in the second quarter, an increase of 15.98% from the first quarter and an increase of 6.6% year-on-year in 2022. The entry of new production capacity into the market and the weak downstream consumption level have affected the enthusiasm of production companies. Textile demand in the second quarter has gradually entered the off-season, making it even more difficult for prices to rise.
Insufficient export sales, unable to carry goods away
This year, the best-selling products in the gold, three and silver markets are more likely to be imitation silk products. Elastic products containing spandex are not as popular. The market is mainly dominated by spring and summer fabrics. According to the inventory days of sample companies monitored by Silkdu.com, the local operating rate is at a low level and is only 74.2% during the peak season. Conventional varieties are not in good supply, and textile bosses are not interested in producing inventory.
However, the amount of spandex yarn used in textile fabrics is not large. The demand for fabrics is not large in terms of the volume of spandex yarn. It still depends on the export aspect. In January 2023, domestic spandex exports were 4831.33 tons, +8.21% month-on-month, and -42.76% year-on-year; in February 2023, domestic spandex exports were 5645.49 tons, the average export price for the month was US$5128.43/ton, and export volume was +16.85% month-on-month. -29.69% year-on-year, and the cumulative export volume from January to February was 10,476.82 tons, -36.39% year-on-year. According to customs data, spandex exports fell sharply from January to February compared with the same period last year, and export prices weakened. In the face of insufficient foreign orders, companies often accumulated inventory, and domestic sales in the market were better than export sales in the first quarter.
The domestic and export demand for spandex yarn in the first half of the year was very average, so even if the cost-end price increases, it is difficult to cause the price of spandex yarn to rise. However, the demand for four-way stretch products in the second half of the year will be greater than that in the first half of the year. By then, the price of spandex yarn will It may rise.
Overall, the price of spandex yarn has declined in a short period of time. Of course, it will not see the sharp rise and fall in the past two years. It is still mainly stable in the near future.
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