Since the beginning of this year, due to changes in the industry’s supply and demand relationship and a substantial increase in raw materials, domestic spandex prices have risen sharply, with an increase of 86% since the beginning of this year, compared with the same period last year The increase is more than 150%. The changes in the business cycle of the spandex industry are mainly due to the decline in production capacity on the supply side in the past few years. At the same time, the demand side has continued to grow rapidly due to the upgrade of epidemic prevention materials and clothing fabrics. At the same time, BDO has continued to promote the surge in PTEMG this year, which has also further pushed up the price of spandex. grow rapidly.
In the recent stage, benefiting from the booming spandex industry, the spandex industry is also actively expanding production to seize dividends, and the launch of new production capacity is mainly concentrated at the end of the year.
The three major spandex giants have recently released new production capacity
There is significant room for improvement in subsequent spandex production
Huafeng Chemical Co., Ltd. issued an announcement on September 1, announcing that the second phase of the 100,000 tons/year differentiated spandex project invested and constructed by its holding subsidiary Huafeng Chongqing Spandex Co., Ltd. has been completed Enter the debugging stage. According to reports, the project has undergone optimization and innovative design in terms of production equipment, process routes, and energy solutions. After the project reaches full production, Huafeng Chemical’s production costs will be further reduced, the product structure will be further optimized, and the market share will be further increased.
Hyosung Spandex (Ningxia) has an annual output of 360,000 tons of spandex and its raw material supporting projects covering an area of 1,000 acres , with a total investment of 12 billion yuan, will be constructed in five phases according to the principle of one-time planning and phased implementation. The main body of the first phase of the project has been completed and equipment installation is in progress. It is expected to be put into production in November this year.
Xinxiang Chemical Fiber recently stated on the investor interaction platform that the first phase of the company’s annual output of 100,000 tons of high-quality ultra-fine denier spandex fiber project is currently progressing smoothly and is expected to be It will be put into production in the fourth quarter of 2021.
Since 2021, spandex factories have been operating at sufficient capacity, with an average annual operating rate of 89%, an increase of nearly 7% from the average annual operating rate in the previous two days. The output from January to August was 533,000 tons, an increase of 14.62% year-on-year in 2020 and an increase of 18.97% year-on-year in 2019. In the short term, spandex continues to have high operating conditions, mainly because factory inventories remain low. So in 2021, most of the new domestic spandex production capacity will be in the third and fourth quarters. In July, Huahai’s new production capacity will be put into production one after another. A set of 40,000 tons of new production capacity in Chongqing Huafeng is being put into production. It is expected that materials will be released into the market in September. A set of Xinxiang Chemical Fiber is expected to be put into production in September. The 10,000-ton unit is expected to be put into operation in October. The new production capacity of the spandex factory has been gradually released in the near future, and the original equipment has been started to maintain the current level. There is still obvious room for improvement in the spandex output in the second half of the year.
New production capacity may have an impact on market prices
Prices are inevitable, but are you worried about a sharp drop?
From January to July 2021, the apparent consumption of spandex reached 430,000 tons, an increase of 12% compared with the same period last year; an increase of 17% compared with the same period in 2019.
According to current data analysis, the apparent consumption of spandex in 2021 is conservatively estimated to be around 750,000 tons, with a growth rate of 9.5%. Net exports for the whole year were 65,000 tons, a growth rate of 4%, and the production growth rate is estimated at 12.7%. Overall, under the strong demand for spandex throughout the year, the gap between supply and demand is still negative.
With the release of new production capacity in the second half of the year and entering the market, industry players are worried that demand will be lower than expected. Recently, there has been news that spandex is going to fall, but it is true that since late August, the trend of spandex has begun to weaken. As the overall downward trend of downstream weaving operations has become more obvious, demand has weakened, and supply has eased, the market price of spandex has indeed declined to varying degrees. of decline.
The editor believes that the increase in industry production capacity may have an impact on market prices, and price drops are inevitable. What I am worried about is a sharp drop. The current inventory of spandex is at a low level. With the current supply of spandex easing and the arrival of the traditional peak season, some rigid demand can still be followed up. Fine-denier spandex will not be out of stock. This may also be a good thing. The weaving market is unpredictable. , like last October, it is not impossible for a sudden wave of market orders to come. Nowadays, spandex in high-priced areas has mostly declined, and some traders are selling at low prices, but the overall price range remains relatively high. If spandex drops sharply, early stockpiling will even significantly affect the price of gray fabrics in the future. The current inventory of gray fabric merchants is high, and there are many When the subsequent wave of orders comes, the rising price of spandex will, to a certain extent, assist the subsequent weaving market in digesting inventory.
In the short term, spandex will still be in a high-level consolidation stage. In the process of upstream and downstream games, it may enter a stable period like April-May this year. Textile and clothing Terminal consumption has not yet started and the weaving operation has weakened. Most spandex factories have limited motivation to increase their quotations. There have even been high price corrections. The quotation ranges of various spandex factories have gradually narrowed. Regardless of the cost side, the current change in demand is the most critical factor affecting the trend of spandex. In the future, we will further pay attention to the follow-up of domestic and foreign orders in the downstream. With the supply of spandex further abundant in the second half of the year, if the demand is difficult to boost or even declines, the spandex market will Prices are bound to come under greater pressure.
</p
