For the Quarter Ending September 2024
North America
In Q3 2024, the North American Viscose Filament Yarn (VFY) market exhibited a steady pricing trend, influenced by a favorable balance of supply and demand dynamics. Throughout the quarter, consistent demand from key sectors such as textiles and fashion supported this stability. VFY's increasing preference due to its quality and sustainability attributes further bolstered its market position.
Supply conditions played a crucial role in maintaining price steadiness. Manufacturers effectively managed production levels and maintained adequate inventories, ensuring a reliable flow of products to meet market needs. The consistent availability of raw materials, particularly dissolving pulp, also helped mitigate potential price fluctuations. Additionally, logistical efficiencies allowed for timely distribution, further reinforcing the steady pricing environment.
Despite fluctuations in global market conditions, VFY prices in North America remained stable, with only minor adjustments observed during the quarter. Overall market sentiment was positive, as both suppliers and consumers anticipated stable demand moving forward, positioning the VFY market favorably within the broader economic landscape.
APAC
In Q3 2024, the APAC region witnessed a decline in Viscose Filament Yarn (VFY) prices, primarily driven by reduced production costs linked to lower feedstock prices. A significant decrease in the cost of dissolving pulp, a vital raw material for VFY production, enabled manufacturers to adopt more competitive pricing strategies in the market. This shift allowed producers to respond effectively to changing market conditions while maintaining their margins. Throughout the quarter, demand from downstream industries, particularly the textiles and apparel sectors, remained moderate, characterized by steady consumption levels. However, this stable demand did not exert upward pressure on VFY prices, as the increased supply resulting from lower production costs outweighed any potential gains from demand. In India, the market experienced notable price fluctuations, with VFY prices declining by 5% compared to the same quarter last year. Interestingly, quarter-on-quarter prices in the Indian market rose by 1.5%. By the end of the quarter, VFY prices in India were noted at USD 4892/MT, reflecting ongoing adjustments amid prevailing market dynamics.
Europe
In Q3 2024, the EU region experienced a decline in Viscose Filament Yarn (VFY) prices, primarily driven by lower production costs resulting from reduced feedstock prices. The significant decrease in the cost of dissolving pulp allowed manufacturers to lower their prices competitively in the market. Despite these favorable production conditions, overall demand remained moderate to low, largely influenced by weak consumer sentiments across various sectors. Throughout the quarter, the sluggish demand was particularly evident in the textiles and apparel industries, where purchasing activity did not match production levels. However, by the final month of the quarter, there was a slight improvement in consumer sentiment, partially fueled by a cut in interest rates by the European Central Bank (ECB). Unfortunately, this boost in sentiment did not translate into increased VFY prices, as the market was burdened by excess inventory. As a result, the combination of low production costs and moderate demand led to a sustained decline in VFY prices, reflecting ongoing adjustments to market dynamics in the EU region.
For the Quarter Ending June 2024
North America
In Q2 2024, Viscose Filament Yarn (VFY) prices in North America exhibited a bearish trend, primarily due to diminished demand from downstream sectors. The textile industry faced significant challenges, leading to reduced consumption of the Viscose filament yarn.
Textile mills, in particular, experienced severe impacts as the U.S. manufacturing sector saw a loss of approximately 8,000 jobs in June, according to the Bureau of Labor Statistics (BLS). A survey of purchasing and supply executives across various sectors, including textile mills, apparel, and leather, highlighted a contraction in manufacturing activity by the end of the second quarter. This downturn was marked by a decrease in new orders, production, and employment, reflecting a broader slowdown in manufacturing.
Furthermore, the Office of Textiles and Apparel (OTEXA) reported that U.S. imports of apparel dropped to 1.963 million square meter equivalents (SME) in May 2024, a decline of 1.3% compared to May 2023. This reduction in imports mirrored the weakened demand within the U.S. market, affecting the VFY sector.
In summary, the Viscose Filament Yarn market in North America remained bearish during Q2 2024. The combination of low downstream demand, reduced manufacturing activity, and a decrease in apparel imports contributed to the sustained decline in VFY prices throughout the quarter.
APAC
In Q2 2024, the APAC region saw a significant increase in Viscose Filament Yarn (VFY) prices, with India experiencing the most pronounced fluctuations. Several factors contributed to this upward trend. Strong demand from both domestic and international markets, combined with disruptions in supply chains, led to tighter supply conditions, which drove prices higher. Additionally, rising production costs, particularly due to increased wood pulp prices, further fueled the surge in VFY prices. Seasonal factors also played a role, with heightened demand during the festive season adding to the price increases.
In India, VFY prices consistently rose throughout the quarter, reflecting a positive pricing environment. The interplay of high demand, supply constraints, and increased production costs resulted in a 3% price increase compared to the previous quarter. A notable price difference of 3% between the first and second halves of the quarter underscored the strengthening price momentum. By the end of the quarter, VFY was priced at USD 5074/MT Ex-Surat, indicating a bullish market sentiment and a strengthening pricing environment for VFY in India.
Europe
In Q2 2024, the Viscose Filament Yarn (VFY) market in Europe experienced a continuous upward trend, marked by substantial price increases due to several key factors. The primary driver of this trend was the significant rise in feedstock costs, especially wood pulp, which surged due to increased demand from the paper manufacturing industry. This escalation in feedstock prices led to higher production costs for VFY manufacturers, who then raised their prices to sustain profitability. Additionally, logistical issues and rising freight charges exacerbated the situation, further inflating overall costs and contributing to higher VFY prices.
Germany, a key market within the region, saw the most notable price fluctuations this quarter. The German market experienced strong positive sentiment, fueled by robust demand from the textile sector and a well-balanced supply-demand dynamic. Seasonal factors also influenced the market, with increased orders for sports textiles and related products aligning with major events like the 2024 European Football Cup, which boosted market activity. Overall, Q2 2024 presented a distinctly positive pricing environment in Germany, driven by increasing input costs, logistical challenges, and strong demand dynamics.
For the Quarter Ending March 2024
North America
In the first quarter of 2024, the Viscose Filament Yarn (VFY) market in North America showed a mixed pricing pattern, characterized by fluctuations where certain months witnessed increases while others saw decreases. Several factors contributed to these price shifts.
A significant factor affecting VFY prices was the surge in import costs, driven by the Red Sea crisis. This situation led to a bullish trend in prices. Additionally, rising interest rates and manpower wages impacted VFY production costs, further fueling expectations of price hikes. Despite moderate demand from downstream industries, high freight charges added to the upward pressure on prices. Moreover, reduced demand from downstream industries in Europe led to a decrease in VFY offtake from the apparel and textile sectors.
Overall, the pricing environment for VFY in the North America region during Q1 2024 showed volatility. Price fluctuations were influenced by factors such as import costs, supply-demand dynamics, and downstream industry demand. In summary, prices experienced a decrease of more than 1% compared to the previous quarter and a decline of over 3% compared to the same quarter of the previous year.
APAC
The pricing landscape for Viscose Filament Yarn (VFY) in the APAC region during Q1 2024 displayed a degree of volatility, marked by fluctuations observed across different regions. In the initial and final months of the quarter, prices saw a decline, while there was an improvement noted in the middle of the quarter. This downward trend can be attributed to reduced demand from downstream industries such as embroidery, georgette, and home furnishing manufacturing items. Additionally, the influx of inexpensive imports from the Chinese market further contributed to the price decrease. Conversely, the sudden surge in prices during the middle of the quarter was fueled by heightened demand from downstream textile industries amid tight material availability. Globally, there was inflation, prompting traders to seek procurement from the Indian market, thereby exerting pressure on limited inventories. Overall, the pricing scenario for VFY in India during Q1 2024 exhibited a mixed outlook, with both positive and negative price changes observed in the APAC region. Market fluctuations were influenced by factors such as downstream industry demand, raw material availability, and international procurement pressures. In India, VFY prices remained lower by approximately 3% in Q1 2024 compared to the previous quarter, with a decrease of over 10% compared to the same quarter of the previous year.
Europe
During the first quarter of 2024, the European market for Viscose Filament Yarn (VFY) experienced a combination of pricing trends, initially witnessing a decline followed by stabilization, and a slight upward trend towards the end of the period. Various factors influenced the pricing dynamics of VFY in Europe. Despite moderate to low availability, manufacturers were able to maintain smooth operations. However, the market faced challenges due to high chemical prices and increased marine freight costs, which affected the supply-demand balance. On the demand side, there was a moderate to high level of demand for VFY.
In Germany, VFY prices stabilized in the middle of the quarter after a notable decline at the beginning. This stabilization was primarily attributed to favorable production costs, driven by a decrease in raw material prices. However, there were indications of a potential rebound in the subsequent months. Overall, the pricing environment for VFY in Europe remained fluctuating, with supply and demand factors playing pivotal roles in influencing prices. In summary, VFY prices in the German market increased by 1% in the first quarter of 2024 compared to the previous quarter, while experiencing an approximately 6% decrease compared to the same quarter of the previous year.
For the Quarter Ending December 2023
North America
Throughout the fourth quarter of 2023, the Viscose Filament Yarn (VFY) market in North America witnessed a consistent downward trend. The US market experienced marginal fluctuations with a confirmed downtrend, largely attributed to stable supply dynamics.
Economic activity in the US remained subdued in November, contributing to the overall decline. However, smooth supply chain operations without significant disruptions mitigated cost pressures on VFY prices. Despite a previous month's price increase due to rising production costs, the market's narrow balance between demand and supply supported the overall downward trajectory. Downstream manufacturers faced a slight decline in demand, prompting VFY manufacturers to proactively reduce prices to manage inventory levels and stimulate market demand. This strategic move, aimed at managing inventory and stimulating market demand, had a notable impact on the overall dynamics of the US VFY market.
In December 2023, the Manufacturing Purchasing Managers' Index (PMI) for the United States was adjusted downward. The decline in output resumed during this period, and the downturn in new orders accelerated, reflecting weaknesses in both domestic and external demand conditions. Meanwhile, firms responded to these challenges by adjusting down their input buying and hiring activity in line with the observed downturn in the manufacturing sector.
APAC
In the Asia-Pacific (APAC) region during the first half of the fourth quarter of 2023, the Viscose Filament Yarn (VFY) market faced constraints in production capacity, coupled with a slowdown in downstream industries and a slight decrease in start-up load. Despite a mild improvement in the Purchasing Managers' Index (PMI), the market witnessed a drop in VFY prices in the second half, influenced by persistent demand weaknesses in the manufacturing sector. Raw material dynamics, primarily derived from wood pulp or plant-based sources, played a pivotal role in shaping pricing trends. VFY manufacturers responded to surplus inventory challenges by aggressively reducing prices to stimulate new orders and alleviate stock accumulation. Despite challenges, a slight uptick in the China General Manufacturing PMI in December 2023 suggested a marginal improvement in the manufacturing sector, potentially indicating a more optimistic outlook. The combination of weak demand and excess supply has resulted in manufacturers sitting on bloated inventories. This pressure to clear stocks incentivizes them to offer deeper discounts, adding fuel to the price decline.
Europe
In the European Viscose Filament Yarn (VFY) market during the fourth quarter of 2023, prices experienced a marginal appreciation in the first half. This was driven by a 1.1% decline in industrial chemical production across the Eurozone and increased demand from the downstream textile industry, particularly as winter apparel demand grew. Improved purchasing sentiments, especially with the approaching festive season, further strengthened demand. This contrasted with economic conditions in Germany, where export orders declined, and GDP was expected to contract, indicating recessionary conditions. In the second half of the quarter, the VFY market in Germany experienced a decline due to demand weakness in the manufacturing sector. Raw material dynamics, sourced primarily from wood pulp or plant-based origins, played a significant role in shaping pricing trends. he revised Manufacturing Purchasing Managers' Index (PMI) for Germany in December 2023 was slightly elevated up from the initial estimate. Despite persisting within the contraction zone, there are indications that the manufacturing sector's most challenging period of decline has passed. Meanwhile, in response to competitive pressures and diminished input costs, manufacturers maintained a trend of lowering factory gate charges on the pricing front.
For the Quarter Ending September 2023
North America
During the third quarter of 2023, Viscose Filament Yarn (VFY) prices were mixed in the North American region. In the first half, reduced demand in the downstream textile industry and a loss of cost competitiveness due to declining wood pulp markets negatively affected the VFY industry. Furthermore, a surplus of VFY emerged as demand dropped, forcing suppliers to lower their profit margins to clear excess stock. This oversupply issue resonated throughout the global textile value chain, exacerbated by factors like the usual seasonal slowdown and high temperatures, which reduced yarn mills' operational rates. However, in the latter part of the quarter, the industry witnessed a resurgence in demand, driven by increased orders from knitwear industries. Meanwhile, traders and distributors faced challenges in securing an adequate supply of feedstock to sustain their production processes. Consequently, the manufacturing sector experienced modest growth, as evidenced by the September Purchasing Managers' Index (PMI) in the United States. Additionally, the Consumer Price Index (CPI), a key measure of inflation, saw monthly increases, further influencing consumer prices.
APAC
In the Asia-Pacific region, the performance of the Viscose Filament Yarn (VFY) market during the third quarter of 2023 displayed a mixed outlook. The initial half of the quarter witnessed a decline in the market, largely due to growing stockpiles, with little enthusiasm for restocking. In the export market, there was lackluster demand from importing nations like Turkey and the United States. In addition, the off-season period for traditional industries contributed to a cautious "wait-and-see" approach, leading to subdued enthusiasm for procurement activities. Towards the end of the quarter, VFY plant operators began increasing their prices due to tighter product deliveries, resulting in a more stable trading price. Furthermore, there was a noteworthy improvement in orders from downstream clothing and home textile industries, and the overall operating rate increased as festive season demand geared up. In addition to this, the Confederation of Indian Textile Industry (CITI) cited that Indian textile exports demonstrated a significant growth of 13.98% compared to the previous year's August.
Europe
Viscose Filament Yarn (VFY) prices exhibited a continuous decline throughout the third quarter of 2023. This downward trend in VFY prices can be attributed to cautious consumer spending, especially in the Eurozone, which was grappling with inflationary pressures. Consequently, the European textile industry experienced a slump in the first half of the quarter, coupled with a reduction in new orders, reflecting uncertainty among customers. In response to these challenges, some companies made adjustments to their workforce, though most approached staff cuts cautiously. Furthermore, the broader business activity within the Eurozone faced contraction in August 2023, as indicated by a decrease in the purchasing managers' index (PMI) output index across both manufacturing and services sectors. However, major VSF manufacturers were also compelled to lower their prices in an attempt to attract customers. Despite these efforts, consumers and buyers remained hesitant to place new orders. Consequently, there were limited orders, as many participants in the viscose market opted to take a cautious "wait-and-see" approach.
For the Quarter Ending June 2023
North America (USA)
Viscose Filament Yarn (VFY) prices in North America reflect mixed market sentiment. The first month saw a marginal increase in the price, while the second month showed a deterioration in the price. This was due to a lack of demand from the downstream home textiles and clothing sector. In terms of supply, supply was sufficient, and inventory levels were average. According to data released by FRED, the Consumer Price Index (CPI) for May 2023 rose to 131.195 compared to 130.811 for April 2023. However, rising inflation kept consumers away from buying the product. Meanwhile, FRED's producer price index declined to the lowest level of the year, dropping to 246.171 for May 2023 from April 2023's 248.712. The smooth supply chain and lack of demand also contributed to a decrease in the region's manufacturing activity, as evidenced by the decreasing US PMI. As a result of weak downstream demand and sufficient inventories, the traders and distributors lowered their margins during the second half of the quarter.
APAC
The Indian markets for Viscose Filament Yarn (VFY) have been experiencing consistent downward pressure on prices throughout the second quarter of 2023. Moreover, the production cost in the region has been negatively impacted by the decreasing prices of raw materials such as wood pulp. Downstream industries also appeared vague, with unresponsive demand from apparel and home furnishings industries. During June 2023, the country had over 30% surplus capacity in the textile value chain, particularly in capital-intensive sectors like spinning and weaving, and was curtailing on their production, foreseeing bulk inventories in the warehouses. However, the Consumer Price Index (CPI) for June 2023 increased to 180.9 (compared to May 2023 of 179.1), indicating high inflation. In such an inflationary scenario, the demand for textile products deteriorated significantly from local as well as from the US and European markets. Finally, according to the ChemAnalyst database, the market for VFY Bright 40F deteriorated throughout the second quarter, with Viscose Filament Yarn prices hovering at USD 5459/MT Ex-Surat during June 2023.
Europe
Viscose Filament Yarn (VFY) market in Europe followed the same pattern as the Asian market, with fluctuating prices during the second quarter of 2023. However, there were several factors that affected the VFY market in the Eurozone. First, there was a lack of demand from the downstream apparel and home furnishing sector. This was due to recessionary pressure as the German economy experienced high inflation during the second quarter of 2023. While the inflation rate decreased to 6.1 % in Q2 2023 from over 7% in Q1 and Q2 2023, it was still high enough to affect consumer sentiment. Under the pressure of inflation, consumer spending decreased, which further impacted the margins of manufacturers in the region. However, given the low demand and seamless product availability, the producers in the region were considering production cuts, as German manufacturing activity was observed to decrease in June 2023. As a result, the price for VFY fluctuated throughout the second quarter, supported by the sluggish market sentiments.
For the Quarter Ending March 2023
North America
The declining demand for Viscose Filament Yarn (VFY) was witnessed throughout the first quarter of 2023. This price decline was likely due to a combination of factors, including declining demand, increasing inflation, and fluctuations in the pricing of significant raw materials. Since the textile sector was susceptible to macroeconomic conditions, changes in these factors had a significant impact on the industry. Despite attempts by producers to grow inventories while keeping employee levels mostly constant, capacities were believed to be adequate for current demands. However, the weak demand for yarn and no signs of improvement from downstream for producing fabrics for clothing and home textiles meant that manufacturers had to lower prices to move their inventory. Overall, it seems that the textile industry was facing a challenging market environment characterized by weak demand and a surplus of inventories.
APAC
The slower buying in the region put pressure on prices in the Asian Viscose Filament Yarn (VFY) market; as a result, the market witnessed a lowering throughout the first quarter of 2023. The downstream demand remained weak at the same time, and Viscose Filament Yarn companies passively dropped prices to match the declining raw materials market and shift to the downward channel. Restricted seasonal garment consumption was another factor in the fall in clothing consumption. But recently, the industry has been struggling because of low domestic output as a result of the slow offtake in recent months. The Index of Industrial Production (IIP) for textiles similarly shows a persistent fall in textile production in the Indian textile industry. As a result, the Viscose Filament Yarn market dropped because of an adequate amount of inventory due to the slowdown in demand.
Europe
It appeared that the domestic Viscose Filament Yarn (VFY) industry was facing a decline in profit and volume growth due to slowing downstream demand from textile industries. This was causing manufacturers to lower their margins as sales were modest and inventories were high. However, the productivity of units was at its highest, which means that there was no observed congestion for product delivery by ship, rail, or road, while manufacturers had ample inventories to fulfill consumer requirements. However, despite these favorable conditions, the output index fell by 1.2 points among textile manufacturers and 1.3 points among apparel manufacturers over the January-March 2023 period. This decline in the output index suggests that textile and apparel manufacturers were facing challenges in the current market conditions. The slowing demand for VFY was likely due to a variety of factors, such as changing consumer preferences, increased competition, or changes in the global economy.
For the Quarter Ending December 2022
North America
In North America, during the first half of the fourth quarter, Viscose Filament Yarn was in extremely high demand. Volatility and high raw material prices slowed the expansion of the target market. However, huge demand from the downstream industries of clothes, upholstery, and other bedding materials fostered the growth of Viscose Filament Yarn in the region. Later, as the US struggled with production, the stockpile decreased, putting pressure on both export and domestic pricing. As a result, the cost of Viscose Filament Yarn decreased in the first half of Q4, while it witnessed high order during the second half of the fourth quarter.
APAC
In the first half of the fourth quarter, the cost of Viscose Filament Yarn decreased. The declining market demand estimates were the main cause of the price decrease. Due to poor offtakes from downstream textile industries, the Chinese market's demand for clothes, upholstery, and other bedding materials ultimately fell. Additionally, a covid ban prompted by a rise in new cases had subdued the local market's fervor. Manufacturers witnessed high stocks amongst themselves since the sale of materials was reduced. Later in the second half, the VFY price increase was mostly brought on by the increasing market demand expectations. The demand for the VFY was great, and the operational load of units was also very high either.
Europe
The Viscose Filament Yarn pricing trend has been rising since the start of the fourth quarter. Due to the rising cost of the feedstock wood pulp, the region's production was curtailed, and Viscose Filament Yarn production costs increased across Europe. Later in the second half, the domestic region's sales-to-inventory ratio was also out of balance as a result of the downturn in demand from the clothes, upholstery, and other bedding materials industries. It is clear from the aforementioned causes that rising production costs, and increased demand from downstream industries, resulted in the decline in stocks in the region, which caused an incline in VFY prices in the second quarter of 2022.
For the Quarter Ending September 2022
North America
Due to unfavorable market conditions and low commodity prices, Viscose Filament Yarn (VFY) prices declined during the third quarter in the American market. The excessive product supply and the low demand in domestic markets were the leading causes of the drop. Furthermore, the decreasing price trend in the region was influenced by a pessimistic regional buying attitude. In addition, considerable domestic upstream supply also contributed to the decline in the feedstock price, which in turn had a direct impact on the downward trend in Viscose Filament Yarn Prices.
APAC
Viscose Filament Yarn (VFY) prices rose throughout the third quarter of 2022, backed by expensive freight amid ample queries from the domestic market. The Indian textile sector was rebounding slowly under the influence of economic recovery and additional efforts by the Indian government. Downstream industries were observed increasing yarn prices because they were trying to pass on the higher cost of production. However, the weaving industry and garment manufacturers felt higher production costs could discourage end-users. However, Viscose Filament Yarn's demand for its utilization in luxury fabrics such as satin and velvet was found to be moderate in the domestic market. The price for VFY settled around USD 5894/MT Ex-Surat during September.
Europe
Due to excessive stockpiles and sluggish market sentiment throughout the third quarter of 2022, the price of Viscose Filament Yarn (VFY) decreased in the German market. The abundance of product supply and the weak demand in the domestic and foreign markets are just two reasons for the decline. Additionally, the downward price trend in Germany was aided by the bearish regional buying attitudes. The increased upstream feedstock supplies also caused the price of Viscose Filament Yarn to decline in the domestic market. Therefore, the ChemAnalyst database suggests of month-on-month decline in viscose filament yarn prices.
For the Quarter Ending March 2022
North America
In the first quarter of 2022, the Viscose Filament Yarn market outlook demonstrated an upward trajectory across the North American region. The demand has stayed strong, especially from the downstream textile sectors throughout the first quarter. A surge in raw material prices and high freight costs have further exacerbated the prices of VFY in the North America. The increase in the price of energy, shortage of labor, freight cost, and lower inventories contributed to the increasing prices of VFY in the USA. Furthermore, rising inflationary pressure also intensified the overall situation and put an extra burden on domestic players. The demand fundamentals for the product from the domestic textile market bolstered the price uptrend in the North American region.
Asia Pacific
Viscose Filament Yarn's (VFY) prices increased in Asia during the first quarter of 2022 due to increased demand from downstream textile and clothing sectors. In India, prices were hovering around USD 5263/MT-USD 5409/MT Bright 40 F and an overall surge of 4.8% quarterly. In India, the price increased in Q1, followed by an improvement in demand and consistent offtakes from the downstream sectors. During Q1 of 2022, the price was assessed to be tracing an upward trend across the Asia Pacific region as the raw material prices increased due to dual-energy policy restrictions in China and a significant rise in manufacturing costs. The traders were compelled to revise their offers to sustain their margins, as imported or exported cargoes were getting expensive daily under inflationary pressure.
Europe
Viscose Filament Yarn (VFY) prices witnessed consistent fluctuations in the European market in Q1 2022. The demand from the downstream apparel and textile market was firm. Consequently, market activities remained high, and the offtakes from the textile industries seesawed during the first quarter of 2022. VFY prices in Europe were assessed at nearly USD 5300/MT by March. Although the production level remained stable at several production units against the rising demand from the downstream sector, surging operational costs resulted in a significant hike in the regional producers' Viscose Filament Yarn (VFY) prices. The European VFY market saw limited supplies due to wavering feedstock availability, limited imports, and transportation delays in the northwest European region.
For the Quarter Ending December 2021
North America
The overall market outlook showcased an upward trend in the North American region due to increase in the price of raw material in the US domestic market. Additionally, increase in the price of energy, freight cost, shortage of labor and low dealers’ inventories were major factors which lead to the increase in the price in the US market. Meanwhile, demand from the downstream construction, pharmaceutical and other end user industries remained stable throughout the quarter. Furthermore, rising inflationary pressure also intensified the overall situation, and put the extra burden on domestic players. In addition, demand fundamentals for the product from the domestic textile market maintained overall stability, bolstering the price uptrend in the regional market.
Asia Pacific
During the Q4 of 2021 the price assessed to be tracing upward trend across the Asia pacific region as the price of the raw material has increased due to dual energy policy restriction in China, and a significant rise in manufacturing cost. In India, the price demonstrated increment in Q4 (for October-November) followed by improvement in demand and consistent offtakes from the downstream sectors. Another reason for increase in the price is the soaring freight charges, which compelled traders to revise their offers to sustain their margins, as imported or exported cargoes were getting expensive day by day. Conclusively, VFY assessed around USD 5138/MT during December on India.
Europe
The European market demonstrated a significant increase in the market price during the quarter 4 due to the high cost of energy which left significant impact on the price. Additionally, increase in the freights cost, expensive raw material across Europe region was also the key problem for producer. The prolonged supply chain constraints container shortage, labor shortage and port congestion which cause the impact on the market segments in Q4, nevertheless the demand from the downstream industries remain sturdy during this quarter.
For the Quarter Ending September 2021
North America
In the third quarter of 2021, the overall market outlook demonstrated an upward trajectory across the North American region. The resumption of industrial activities after hurricane Ida’s landfall that caused the shutdown of several manufacturing units in the US Gulf Coast compelled the textile manufacturers to boost production in Q3. In terms of demand, it has remained strong from the downstream sectors throughout the quarter. Surging raw material prices and high freight costs have further exacerbated the increased prices of VFY during the quarter.
Asia Pacific
In the Asia Pacific region, the prices of VFY kept on climbing in the 3rd quarter of 2021 due to firm demand from the textile manufacturers. In India, VFY prices rose effectively in July, backed by spiralling freight charges amid ample queries from the domestic market. The Indian textile sector is rebounding slowly under the influence of economic recovery and additional efforts by the Indian government. The price of Viscose Filament Yarn (Bright 40F) was last assessed at USD 4996/MT Ex-Surat during September. Recently, the government has eradicated antidumping duty from Viscose staple fiber in order to protect the profit margin of downstream users, which enhanced the market sentiments for textile manufacturers in the Indian market. Viscose fiber and spun yarn prices declined in China due to ample availability and low demand.
Europe
The European market witnessed a significant rise in the pricing trend of VFY in Q3 2021 due to high energy costs which will potentially increase price further in the fourth quarter. Soaring freight and raw material costs also remained a key worry for producers and the companies seemed to be taking steps to prevent further margin erosion. Energy cost adjustments and additional surcharges further raised the regional offers. High level of textile exports outside Europe during the second and third quarters of 2021 forced producers like Kelheim Fibres GmbH to transfer these cost escalations to their end customers.
For the Quarter Ending June 2021
North America
In the North American region, the restoration of the industrial infrastructure in the US Gulf coast accelerated the textile market activities with improvement in supply chains in Q2 2021. The pricing movement of Viscose Filament Yarn (VFY) remained on an uptrend as the feedstock wood pulp prices observed a hike of 40% since January 2021 and imports from the overseas market remained firm with an additional support of the high freight costs. Mass vaccination programmes amplified the public movement which provided extended support to the downstream activities. As a repercussion, the VFY demand outlook improved in the second quarter of 2021 and prices showed a marked surge due to multiple factors supporting the inflationary trend.
Asia Pacific
In China, the Viscose Filament Yarn (VFY) market was weak throughout the second quarter of 2021 as high-priced raw materials amidst rising inflation rate in China and consistent rise in the prices of cotton strengthened the wait and see approach amidst the spinners. Finnish Group Stora Enso suddenly announced shutdown at its wood pulp activities and pulled out from the Chinese Viscose market, ending its sales to the producers in the Xinjiang province. Whereas in India, the domestic market remained stagnant in the first half of the quarter due to the restricted activities as the second wave of COVID impacted the market activities. Demand remained muted due to hovering uncertainties in the Asian textile sector with strong anticipation that the Chinese VFY export volumes would likely return to the pre-pandemic levels if the control of COVID-19 pandemic in several countries takes place sooner.
Europe
During the second quarter of 2021, the VFY market in the European region observed raw material shortages due to hiked cost of wood pulp. The mass vaccination drives induced the public movement during the second half of the quarter. As a ripple effect, the market activities picked up pace and the offtakes from the textile industries surged during the second quarter of 2021. Although the production level remained balanced at several manufacturing facilities against the rising demand, surging operational costs resulted into significant hike in the Viscose Filament Yarn (VFY) prices offered by the regional producers.
For the Quarter Ending March 2021
North America
During the first quarter of 2021, the North American VFY market was significantly affected, as supplies remained affected due to low inventories of the crucial feedstock. Several factories in the US Gulf region of the United States were forced to shut down production due to the severe freeze weather conditions despite strong demand from the downstream textile industries. By March-end, raw material pulp showed spike amid continued tightness in the supply as the industry showed recovery from the operational cuts impended since the mid of February. The supply-demand gap widened, resulting in an upward push to the VFY prices in the North American region.
Asia-Pacific
Due to environmental protection inspections in China during the first quarter of 2021, the restricted supply of cotton linters followed by the plant’s turnaround during the spring festival led to affected supplies of VFY in Asia pacific market. Since the middle of the Q4 2020, the Asian VSF market had begun to recover from the pandemic induced slowdown, which proportionally supported the VFY (Rayon) market throughout the region. Grasim industries improved the production of VFY as the demand is India reached to pre-COVID levels in Q1 2021. Overall demand of the Asian market surged as the offtakes improved from the Indian textile industry. The prices of VFY remained stable in around USD 4950 per tonne levels in India during March.
Europe
In the first quarter of 2021, the European VFY market saw restricted supplies due to a scarcity of feedstock VSF, limited imports, and transportation delays in the northwest European region due to adverse weather conditions which hampered the production rates in several major facilities across the NW European region. The impeding ban on single use plastic boosted VFY demand in the European market, prompted by improved arbitrage with the Asian market and better offtakes from the textile sector in the peak season.
For the Quarter Ending December 2020
North America
Supply of Viscose Filament Yarn (VFY) from overseas considerably increased with respect to the previous quarters owing to a considerable rebound in the retail sale of textiles. Increased demand for home textile products following the shift to work from home has caused a prominent increment in consumption for various textile products. Suppliers were heard catering imports from more than two Asian countries to restrain from the risk of any shortage amidst the pandemic uncertainties. In December end, the US government along with several private officials signed an MoU to assist Asia Pacific garment workers severely hit by Covid-19 hardships.
Asia
With an appreciable rebound in the textile sector in November, a sharp pickup due to festive demand across several Asian economies bolstered the market sentiments across various textiles units including Viscose Filament Yarn (VFY). Price of VFY (Bright 40D) was averaged at USD 4908 per MT in India, showcasing a significant revival in comparison to the previous quarter. Since several domestic manufacturers reported that the Indian market remained flooded with heavy VFY imports from neighboring countries like China, Indonesia and Vietnam, the country’s commerce ministry announced initiation of anti-dumping probe to check on the imports from these countries in the final week of December. Although the proposed dumping duty is likely to extend the profit margins of domestic manufacturers, but it might also squeeze the intakes for garners and weavers as the prices of domestically produced viscose yarn are already very high. In addition, anti-China movement in U.S. has embraced a shift in the outsourcing of textiles from China to India.
Europe
Recovery in the European Viscose Filament Yarn (VFY) market was severely hit towards the end of Q4 by the sudden buzz of new trace of coronavirus in UK. Partial lockdown implied in several parts of Europe majorly UK has caused a force measure in various garments stores causing the slowdown in the sales of garments in the later half of the quarter. Furthermore, the Brexit agreement signed between European Union and UK has also concerned several suppliers over their export margins in the coming years. Traders anticipate that this deal aiming to push UK as an independent trade identity could bottleneck the investment opportunities and supply chain in the near-term.
