In September 2024, Asian Aramid Fiber prices demonstrated a bullish market trend, largely driven by elevated production costs and strong downstream demand. The increase in Aramid Fiber prices reflects the dynamic interplay between supply chain factors and market needs, particularly in key sectors.

In China, FOB prices for Aramid Fiber META Grade surged by 2.5%, reaching USD 12,244 per metric ton. This price increase can be attributed to higher production costs, particularly for critical feedstocks like Para-Phenylene Diamine (PPD), which rose by 2.6% during the month due to escalating Aniline prices. The impact of these feedstock price increases directly influences the overall cost structure of Aramid Fiber production.

The previous month also saw high Aramid Fiber prices driven by robust demand, especially from the automotive industry. Aramid Fiber is crucial for manufacturing heat shields, gaskets, and under-the-hood insulation, which protect engine components from extreme temperatures. The China Association of Automobile Manufacturers (CAAM) reported that domestic automobile sales in China reached 2.27 million units in September, marking a 16.9% increase from August, although this represented a 6% decline year-on-year. Additionally, exports rose to 539,000 units—up 5.4% month-on-month and 21.4% year-on-year. Notably, sales of New Energy Vehicles (NEVs) surged to 1.176 million units, reflecting an 18.8% increase from the previous month and an impressive 45.5% rise compared to last year. NEVs now constitute 51.8% of total domestic automobile sales, further fueling the demand for Aramid Fiber in automotive applications.

In the Indian market, Aramid Fiber prices also increased by 2.5%, driven by higher import prices from China and rising domestic production costs linked to increased PPD prices, which rose by approximately 2%. However, demand for Aramid Fiber in India remained subdued, particularly in the automotive sector, which experienced a downturn in September 2024. Despite the festive season, including significant celebrations like Ganesh Chaturthi and Onam, dealers reported stagnant sales, indicating muted market sentiment. Automotive sales declined significantly by 8.8% compared to the previous month, as noted by the Federation of Automobile Dealers Associations (FADA). Nonetheless, Chinese Aramid Fiber imports remained moderate in India, supported by low shipping charges during this period.

Looking ahead, the latest figures from FADA suggest a cautiously optimistic outlook for automobile retail, especially with Navratri and Diwali occurring in the same month. This is likely to create strong expectations for a surge in vehicle sales, which would support higher consumption of Aramid Fiber. Analysts anticipate that Aramid Fiber prices are likely to improve further in the coming months, driven by increased consumption in the automotive sector during the festive season.