Global synthetic fiber prices fell by 16.6% in December year-over-year, according to recent data from consulting firm PCI Fibres, pressured by both a continuing decline in oil prices and slowing demand in many key regions of the world.
The price of crude oil plunged by almost 14 percent in the month, capping a year in which prices fell by more than 30 percent, to $37 a barrel.
In Asia, the world’s largest fiber-producing region, synthetic fiber prices fell by 19 percent year-over-year, due primarily to slowing demand for polyester, the biggest fiber in volume terms. Filament prices declined in the month as knitters and weavers bought primarily according to need and many mills shut down even earlier than usual in advance of the Chinese New Year. Chinese demand for staple has also been sluggish but got a boost from seasonal demand for fiberfill. Temperatures in North China were very cold, driving sales of outwear for local consumption.
Nylon prices remained pressured in the month as inventory grew in the global pipeline amid increased competition from polyester in many applications and segments. Spandex prices fell slightly in the month on a decline in demand, but remained stronger at lighter deniers.
After remaining firm for many months, viscose prices in China have fallen slightly as production has remained at 85 percent of capacity but demand has softened somewhat. Most of Chinese viscose staple production is exported. Acrylic staple prices remain relatively stable.
Asian synthetic fiber prices remain almost 25 percent below the world average.
The European synthetic fiber price index fell by just over 20 percent compared to December 2014, its smallest year-over-year drop in six months, but capping 15 consecutive months of double-digit declines. European fiber prices are 17 percent above the global average.
The U.S. index fell by almost 10 percent in December, the least of any major world region, but its biggest monthly drop since August 2009. U.S. prices are 66 percent above the global average.
Although many in the fiber industry expected prices to stabilize in January, oil prices have dropped another 13 percent so far this month, to $32, so it looks like the volatility is far from over.