Acrylic fibre makers try to hold price despite plunge in acrylonitrile
Acrylic fibre (ASF) markets which was facing high cost amid weak demand, is seeing some cost easing in recent weeks. Producers have been trying to hold prices by controlling production, thereby decreasing the overall capacity utilization rate. ASF, a manmade substitute for wool, is used in sweaters and tracksuits, as linings for boots and gloves, and as furnishing fabric and carpet. It is manufactured as a filament, then cut into short staple and spun into yarn.
Asian acrylic fibre markets were silent or reacted to the upheavals of upstream acrylonitrile prices plummeting across regions in the last week of October ending 2 November. In China, the industry run rate clocked 39% as against over 55% in July, indicating that demand was weakening rapidly. In India, producers reduced their offers for November as acrylonitrile prices dropped sharply in past weeks. In Pakistan, offers remained unchanged. In Europe, acrylic fibre producers have also reduced their operating rate to 70-80%, with more pronounced decline in Turkey. AKSA has cut its production by 40% through October due to season lull. Other political and economic reasons, like sharply devalued Turkish lira, also played a role in AKSA’s decision to cut production.
Upstream, acrylonitrile markets in Asia continued to trend down on falling feedstock prices and weak downstream demand. In China, domestic prices dropped by 17% in the last week of October due to weak market sentiment. Major producers also dropped their list and contract prices citing soft demand from the acrylic fiber makers. In Europe, prices declined amid downstream production cuts while export prices in US fell in line with declining values in Asia and Europe
Feedstock propylene markets in Asia extended losses for the third week due to poor market sentiment and supply length in November as arrival cargoes continued to plague the import markets. In China, domestic prices rebounded weekend as demand picked up following restarts of two downstream PP facilities. In Europe, November contract price fell in line with naphtha values while spot inched up a bit. In US, chemical grade propylene was cheaper amid higher inventories and weakening upstream markets.
(Source: Global Markets Weekly Review. For full report write to us at sales@textilebeacon.com)
