Polyvinyl Alcohol Prices Remained Steady Amidst Subaverage Textile Industry Performance

Louisiana (USA): In the USA, Polyvinyl Alcohol prices remained stable this week, largely influenced by the decreased costs of Feedstock Vinyl Acetate Monomer, which had a downstream effect on the Polyvinyl Alcohol supply chain. However, there were concerns regarding the resilience of the manufacturing sector, marked by the fifth consecutive contraction in the Official Purchasing Managers' Index (PMI), amid declining consumer confidence and a property market burdened with debt.

March 2024 PMI figures were revised downward compared to February. Despite these challenges, broader economic conditions and market demand showed signs of improvement, leading to a significant expansion in US manufacturing production, reaching its highest level in 22 months. Job creation accelerated, albeit with softening growth in new orders. Many companies chose to reduce inventories to improve cash flow, resulting in decreased purchasing activity and stock levels of both inputs and finished goods after February's increases.

Weak underlying fundamentals and reduced cost support were major contributors to this downturn, resulting in fluctuations in Polyvinyl Alcohol prices throughout the week. Domestically, the terminal raw fabric shipments market showed strength, while new order volumes in the export market remained average. However, the pace of recovery in terminal elasticity and weaving start-up rates was slow.

Throughout the week, there has been consistent demand from Polyvinyl Alcohol downstream sectors, particularly in textiles, largely driven by efforts to replenish stocks. As the Polyvinyl Alcohol downstream industry approaches its replenishment phase, there is a discernible inclination towards purchasing during price drops. Additionally, recent criticisms highlighted in mainstream media and consumers' growing dedication to addressing climate change have resulted in more than half of shoppers indicating a willingness to pay extra for sustainably produced goods.

Consequently, there has been an uptick in demand for sustainable products within the Polyvinyl Alcohol downstream textile sector. Early in 2024, US textile and apparel exports experienced a decrease. While exports to Guatemala and China saw an increase, those to the Dominican Republic and Canada declined. Apparel exports slightly decreased, while made-up articles experienced a minor uptick. Overall, US Polyvinyl Alcohol downstream textile exports annually in recent years.

Looking ahead, cost dynamics appear favourable, but geopolitical risks may impact crude oil prices. Nonetheless, despite sufficient Polyvinyl Alcohol supply and elevated inventory levels, it is expected that Polyvinyl Alcohol may continue its weak trend. Polyvinyl Alcohol prices experienced a decline due to an oversupply of goods and decreased interest from downstream polyester factories, exacerbated by the decrease in crude oil futures.