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Global Synthetic Fiber Prices Fall By Double Digits for Fifteenth Straight Month

Global synthetic fiber prices fell by 12.4.% in February, the fifteenth consecutive month of double-digit year-over-year decline, according to recent data from consulting firm PCI Fibres.

The drop was the smallest in nine months, however, indicating that prices for some products are firming.

The decrease is a result of both the continuing decline in oil prices and slowing demand for apparel and textiles in many key regions of the world. The price of crude oil continued to slide early in the month, with the West Texas Intermediate (WTI) price hitting a low of just below $29 per barrel on Feb. 11, then rising slightly through the rest of the month.

In Asia, the world’s largest fiber-producing region, synthetic fiber prices fell by almost 17 percent year-over-year, due primarily to a sales push with incentive pricing in advance of the Chinese New Year. With sluggish demand in the region, many plant closures extended a bit beyond the holiday. Both filament and staple prices declined in the month.

Nylon 6 prices remained relatively stable, but low utilization rates and overcapacity in China continues to pressure profits. China continues to import a large portion of its nylon mill consumption, including many nylon yarns that it’s not able to manufacture domestically.

The spandex business was relatively slow in the month, resulting in flat prices. Both circular knitting and covering were running at very low utilization rates.

Viscose was the one bright spot in Asian fibers. Last year, viscose shipments increased by roughly 4 percent over the prior year and, since the Chinese New Year, have been running at high capacity utilization rates. Prices remain relatively firm and consumers are gravitating toward viscose’s characterization as originating from a renewable source.

Asian synthetic fiber prices remain more than 26 percent below the world average.

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The European synthetic fiber price index fell by just over 9 percent compared to February 2015, its smallest year-over-year drop in a year and a half. European prices are almost 20 percent above the global average. Polyester filament markets remained relatively stable with volumes holding up.

The U.S. index fell by 7.5% percent in February, the least of any major world region, and its smallest year-over-year decline in 15 months. U.S. prices are 68 percent above the global average. Polyester textile filament mill consumption in 2015 was the highest in several years, and business remains stable. The polyester staple market, which had a good run in 2015, seems to have been slowed considerably by much cheaper Chinese imports. The U.S. carpet industry remains depressed as hard flooring take market share.