test


Member ID:
Password: 
Stay logged in for 30 days
Forget Your Password?
close

login CCFGroup App

Insight | Time:Dec 23 2016 1:23PM
What's behind the different performance of three varieties of virgin PSF?
 
Text size
Polyester feedstock and products prices increased this year on the whole, particularly in December.



Polyester feedstock cost hiked in line with the continued price rise of MEG since October despite a mild decline in early November. According to CCFGroup, polyester feedstock cost rose 22.2% since October, 16% since December and 32% from early this year.

Under such circumstance, however, three varieties of virgin PSF saw divergent trends.


Time Polyester cost(PTA and MEG) HC PSF Low-melting PSF virgin PSF for spinning
Jan 4-Dec 20 31.5% 6.0% 29.0% 37.0%
Sep 30-Dec 20 22.2% 10.8% 18.7% 24.8%
Nov 30-Dec 20 8.9% 4.5% 5.9% 15.6%

In view of the whole year, virgin PSF for spinning surged likewise with or even beyond polyester feedstock while low-melting PSF and HC PSF performed worse than the feedstock.

So, what’s behind the difference?


Different competitive tension by capacity

Capacity change in these three varieties presented quite different in recent years though virgin PSF for spinning capacity far outweighed that of low-melting PSF and HC PSF. Virgin PSF for spinning experienced de-capacity while the latter two enjoyed capacity expansion in 2013-2015 with low-melting one rising by 120% in 2016 over 2013 and HC PSF by 20%. Such a growth in capacity inevitably brought about fierce competition in which enterprises started price war to scramble for market share, and hence restraining the price hike of these two varieties.

Different influence on price trend

Polyester staple fiber, in accordance with its feedstock are mainly composed of recycled and virgin one. Market supply of HC PSF and HC re-PSF differed from virgin PSF for spinning and solid re-PSF by a big margin due to various application with the proportion of the former two basically at 1:1 while that of the latter two at 11:1. Even given the lower price of recycled polyester staple fiber because of its lower quality and worse dyeing behavior than the virgin one, different capacity and demand of downstream plants, however, are much bigger concerns in terms of the domination in price change. Thus HC re-PSF led the way and HC PSF followed its trend while virgin PSF for spinning in turn had a bigger say than solid re-PSF in changing the price. At the same time, the product which leads the price trend often enjoys a faster price hike than it that follows. Also, the better performance of solid re-PSF than HC PSF in terms of their price rises was partly because of de-capacity and periodical shut-down of units of solid re-PSF.

Time HC PSF HC re-PSF virgin PSF for spinning Solid re-PSF(HTLS)
Jan 4-Dec 20 6.0% 14.3% 37.0% 22.8%
Sep 30-Dec 20 10.8% 20.5% 24.8% 20.2%
Nov 30-Dec 20 4.5% 6.8% 15.6% 15.2%

Low-melting direct-spun PSF had no such substitution and hence had no such concern.

Divergent profits


As for the cash flow, HC PSF and low-melting virgin PSF cash flow squeezed constantly yet still outperformed virgin PSF for spinning which was around break-even line. Thus virgin PSF for spinning behaved more sensitive towards polyester feedstock price.

Other factors such as the difference in the time of peak and low seasons, downstream replenishment and business operation model also exerted influence on the divergent price rise of the three varieties. Yet all in all the three concerns, namely different competitive tension by capacity, different influence on price trend and divergent profits shared the major responsibility for the various performance of the three products.
Related Articles
PSF plants maintenance schedule during the Spring Festival
Polyester staple fiber market weekly (Jan 16-20, 2017)
USITC MAKES DETERMINATIONS IN FIVE-YEAR (SUNSET) REVIEWS CONCERNING
Polyester staple fiber market morning express (Jan 20, 2017)
Polyester staple fiber market daily (Jan 19, 2017)
Polyester staple fiber market morning express (Jan 19, 2017)
Polyester staple fiber market daily (Jan 18, 2017)
Polyester staple fiber market morning express (Jan 18, 2017)
Polyester staple fiber market daily (Jan 17, 2017)
Polyester staple fiber market morning express (Jan 17, 2017)
 
Research
Changes in China's MEG inventory structure in 2016
Analysis on improved polyester end-user market demand in ...
Analysis on the surging nylon market in the fourth quarter ...
What will HC re-PSF market head for on dropping profits
China PET bottle chip export feature and export destination ...
Companies investing in Xinjiang really perform well?
 
 

浙公网安备 33010902000742号