Everyone who is engaged in the textile industry knows that the price of textile raw materials after the new year has gone crazy. The price of textile raw materials after the new year has gone crazy. But if you want to say Among all kinds of raw materials, the one with the craziest price increase must be spandex. Taking 40D spandex as an example, the price was around 29,000 yuan/ton in September last year, but in the past six months, the price has risen to a maximum of 65,000 yuan/ton, an increase of more than double.
Figure 1 Spandex price trend
Source: Longzhong Information
The sharp increase in the price of textile raw materials after the year is mainly driven by international crude oil Down, costs rise and prices are adjusted passively. Support from the cost side has become an important factor in the price increase of raw materials, and spandex is no exception.
The main upstream raw materials of spandex are PTMEG and pure MDI, with a ratio of nearly 8:2. The upstream cost will increase significantly in 2020, and the overall trend of the main raw material PTMEG will be steady and upward. After the price of pure MDI rose strongly to a high point, it gradually returned to rationality. However, the overall demand side is still following suit. As terminal demand gradually enters the market, the supply side gap is still obvious. Pure MDI also experienced a sharp rise after the Spring Festival. As of March 10, 2021, PTMEG has increased by 20,700 yuan/ton during the year, an increase of 104.5%, and pure MDI has increased by 6,600 yuan/ton during the year, an increase of 29.33%. With strong cost support, spandex prices have gradually climbed to high levels.
But the cost support alone is not enough to make the price of spandex rise so crazy. The demand in the textile market is the important factor that really makes the price of spandex skyrocket.
Raw materials: The pure MDI market fell back from its high level this week, the market’s willingness to make profits is more obvious, and the offer price fell. Suppliers are still mostly in a no-pressure state, but are mainly delivering early orders slowly. The ability to follow up downstream is limited and it is difficult to gain momentum for buying.
Recently, the raw material BDO has been stable and slightly negative, and the cost support is slightly weak, which is negative for the mentality of the industry. PTMEG currently has a lot of inventory in the factory and no pressure, the high offer supports the market, the spandex load is stable, and it enters the market to replenish positions as needed, and the high-end focus of negotiations is strong.
Table 1 Weekly price rise and fall of domestic spandex market
Source: Longzhong Information
Shortage of on-site supply will still support market highs
As of March 11, the spandex market operation maintained 89%, which was the same as the previous month. The inventory is not large, and downstream customers and dealers generally follow up or Inventories are consumed and factories actively ship goods. At present, manufacturers such as Huafeng, Huahai, Hengshen, Schulze, Aoshen, Ruyi, Qingrong, Hyosung, Taiguang, Sihai and other companies have a majority of 90% to 90%, and the construction start-up is still relatively high, with Yantai, Xinxiang, etc. opening 7-8.5% Part of the production capacity is idle, and the overall market is operating well.
According to statistical data, as of March 11, the comprehensive operating rate of chemical fiber weaving in Jiangsu and Zhejiang regions was 70.27%, an increase of 5.70 percentage points from the previous month. Weaving starts showed a narrow increase this week. The industry reported that the market this week was relatively calm compared with last week, and the overall downstream orders were extremely divided. On the one hand, the frequent rise and fall of aggregation costs increases the risk of downstream orders, and foreign trade orders are also in a stalemate. On the other hand, orders were not delivered before the year, and due to insufficient stock of raw materials in the factory, prices rose sharply after the year, resulting in profit losses, and the factory was under severe pressure.
Recently, the market volume and inquiry atmosphere of gray fabrics have declined significantly. In the short term, there is limited room for continued upward growth in construction. Specifically, looking at various professional production bases, the average operating rate of water-jet looms in Shengze area is 79.72%, and the mainstream operating rate is around 70-90%, with some being as high as 90-100% and some as low as around 60%; the average in Changshu area The operating rate is 65.59%, and the mainstream operating load is between 60% and 70%, and some are as low as around 50%. The operating rate of circular knitting machines in Xiaoshao area is 51.31%, the mainstream operating rate is 40-60%, the high operating rate is 70%, and the low operating rate is still 30%; the average operating rate of water-jet looms in Changxing area is 85.50%, and the mainstream operating rate is 85.50%. It operates around 80% to 90%; the average operating rate in Haining is 71.22%, and the operating load of mainstream enterprises remains at around 60% to 80%, with a small number operating at full capacity.
Later forecast
The spandex market will continue to maintain a high and strong pattern next week, and the raw materials may weaken. This has stimulated a correction in spandex prices, but factory supplies are still in short supply, and low inventory supports high offer prices. Downstream traders and weaving customers mostly stock up on spandex at low prices in the early stage. While paying attention to changes in raw material prices, they also need to pay attention to the dumping of low-priced supplies in the market. The spandex market is expected to continue operating at a high level in the short term.
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