Global Synthetic Fiber Prices Track Cotton’s Slide

The global synthetic fiber price index fell by 4.9% in September, according to recent data from consulting firm PCI Fibres, its biggest decline in six months.

The falling price of cotton and slowing demand for apparel and other textile products in key North American and European markets has put tremendous pressure on synthetic pricing in the past several months. In addition, overcapacity of polyester and nylon fiber and raw materials in Asia, and the ingredients cost declines resulting from the slide in crude oil prices could result in a continuing soft market with downward pressure on prices.

In Asia, the world’s largest fiber-producing region, synthetic fiber prices fell by almost 7 percent in the month, their biggest decline in five months. However, in the two weeks leading up to the National Day holiday at the end of September, demand for polyester began to rebound, presumably because prices declined to the point at which demand was stimulated. Operating rates at fiber suppliers in China began to increase, and margins were helped by declines in prices for polyester ingredients TPA and MEG that were steeper than those for the fiber. The anticipated seasonal demand increase for filament fabrics materialized as well. However, prices are not expected to firm appreciably as long as intermediates prices remain low and apparel market growth remains sluggish.

Asian nylon (polyamide) prices were relatively stable in the month. Several new caprolactam plants are coming on line in China, resulting in lower intermediates prices, but fiber producers have managed to hold prices steady.

Spandex prices were down roughly 1 percent in September due to reported soft demand. However, supply remains relatively tight. Spandex makers have enjoyed improved margins due to significantly lower intermediates costs. PTMEG prices fell a reported 4 percent in China in the month.

Asian synthetic fiber prices are almost 21 percent below the world average.

The European synthetic fiber price index fell by 5.4%, their biggest plunge in 16 months, though European synthetic prices remain 19 percent above the world average.

The U.S. index fell by 1.2%, putting the U.S. synthetic fiber prices index at almost 50 percent above the global average. U.S. polyester prices are relatively stable due to PTA shortages created by a fire at BP’s Cooper River facility. Nylon pricing is stable in the U.S., though it could decline in coming months due to recent benzene price reductions. Bulk continuous filament (BCF) for carpeting is steady with good capacity utilization in both polyester and nylon.

PPISynthFib


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