Still can’t hold it in any longer! On March 11, the spandex giant held a sales meeting. The main theme of the meeting was only two words – “price increase”! This week, each manufacturer implemented the spirit of last week’s spandex sales meeting and combined with the actual situation, spandex manufacturers will increase the price by 1,000 yuan/ton from now on.
In just two weeks, this is the second time the price of spandex has been raised this month. But is the sudden increase in spandex an accident? Obviously not. There is only one reason for the price increase, which is still the high level of international crude oil, which directly drives the price of bulk chemicals to rise. Polymer MDI rose from 22,000 yuan/ton in February to 26,000 yuan/ton, with a cumulative increase of 4,000 yuan. /Ton!
The cost pressure is obvious. Factory profits have been squeezed and they are forced to raise prices to protect their own interests! After this price adjustment, the prices of conventional spandex are as follows: 20D spandex 72,500 yuan/ton, 30D spandex 64,000 yuan/ton, and 40D spandex 54,000 yuan/ton.
Downstream demand is insufficient for new orders, so be cautious and wait and see
I don’t know if you still remember the price increase of spandex last year – the price of spandex rose to 100,000 per ton. On the other hand, the spandex at that time required demand and cost support, which is beyond the reach of today’s spandex. Last year, consumers had more and more demands for sports and leisure clothing, and their requirements for clothing functions were getting higher and higher. Instead, clothing made of four-sided elastic can meet the changes in people’s current consumption concepts. Therefore, most of the popular four-way elastics on the market at that time were used to make pants or beach pants, etc.
It can be seen that the current rise in spandex is likely to be a “empty rise.” On the one hand, although after March, small batch orders for spring and summer clothing fabrics have been placed, there is still a downward trend compared with previous years. In the current market, elastic fabrics are definitely not as popular as before. Most downstream users have reported that Order sustainability is poor. In addition, the textile trade in major terminal garment cities such as Shanghai and Hangzhou will be affected by the epidemic in the near future.
High inventories and high production starts drag down spandex prices
On the other hand, the inventory of spandex itself is also at a high level. Through data monitoring, we can see that the current inventory of spandex is 36 days and the operating rate is about 85%. The operating rate of some enterprises is around 90-100%. High inventory and high operating rate It will inevitably drag down the rise in the price of spandex. The spandex that has been rising in price now with the support of rising crude oil prices has a bubble. After the bubble of rising crude oil prices is burst, the prototype will naturally appear. In the end, demand is king.
Looking at the price of gray fabrics, it is expected that it will be difficult to increase the price of elastic fabrics in the short term. Normally, when the price of spandex increases, the related elastic fabrics should also rise. However, as the downstream of the industrial chain, the price transmission is delayed, and currently The market has been relatively deserted. The market has been open for nearly a month now, and the operating rate in Jiangsu and Zhejiang has not yet reached 80%, only 73%. Therefore, if the basic profit can be maintained, the price will not be rashly raised, worrying about customers and orders. Price increases lead to losses.
To sum up, in the short term, the impact of spandex price increases on current orders is indeed limited. However, with the arrival of the peak season, the price impact of spandex will inevitably gradually increase. Will the price of four-way spandex surge by then?
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