2017 PFY may enjoy a lucrative year
PFY capacity expansion in 2017 was of a small scale. In H1, 2017, only Hengbang will start a 300kta PFY unit while in the latter half of the year, there are Xinfengming Zhongshi, Siyang Haixin, Xiaoshan Hengyi, Fujian Jingwei and Fujian Shanli. But most of these units may not start commercial run until the end of 2017 and a few may postpone to 2018. So new capacity of 2017 is assessed to around 1.05 million mt/year, up 4.2% year on year with an annual growth of PFY production at about 2.6%. Limited supply expansion and low inventory at the end of 2016 has laid a solid foundation for PFY market in 2017 and PFY profits may maintain good next year, at a level before 2015 and 2016.
FDY may continue to see better profits than other common products
FDY profits rebounded in recent years with chip-spun FDY backed out and FDY took a small proportion even in differential products. Direct-spun PFY plants largely focused on building POY units and new FDY units were scarce while some FDY capacity became obsolete. In 2017, new POY capacity is about 850kta and new FDY capacity is about 200kta so FDY profits may continue to be better than profits of other common products.
Differential market draws more and more attention
Chip-spun producers have almost backed out from conventional production and turned to produce differential products such as sea-island fiber, T400, PTT, PBT, flame-retardant fiber, low-melting point fiber and cationic fiber, etc., which have lucrative profits and report strengthening demand. In the meantime, direct-spun PFY plants also paid attention to differential products. Profits of differential chips were remarkable and demand for differential chips warmed up as chip-spun producers turned to produce differential fibers. Therefore, some direct-spun PFY producers explored differential chip production by build new units or purchase existing ones with a capacity of 30-60 kta in general.