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Insight | Time: May 26 2020 2:20PM
Direct-spun PSF keeps rangebound in May
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After sharp rise and fall in Apr, direct-spun PSF stayed rangebound in May.

In end-Apr to early May, direct-spun PSF price slid to 5,300-5,500yuan/mt, close to Apr's low. Downstream spinners which had missed previous low went bottom fishing successively, resulting in smooth transactions of direct-spun PSF before and after May Day holiday. Some over-the-counter capacity was even heard to be involved. Quickly, direct-spun PSF plants revised prices up to about 6,000yuan/mt. Although the trading volume was small later due to higher prices, the plants kept prices firm with shortage of supply.

Since May, spinners reported better sales than that in Apr and they even received sporadic export orders, but the improvement moved slowly, and some spinners stayed at a loss, so they still focused on destocking.

As direct-spun PSF for nonwoven cooled down in Apr, some plants returned to produce the one for spinner after delivering previous orders for nonwoven products. Since mid- to late Apr, the operating rate of direct-spun PSF remained volatile within 93-95%. At present, some plants are to finish the pre-sales orders, and they will face inventory accumulation in Jun. In addition, if direct-spun PSF price moves up to 6,000-6,500yuan/mt, those plants which speculated to stock up previously will leave the market after gaining profits. As a result, direct-spun PSF supply in Jun will be large. It remains to be observed whether downstream spinners can digest this part of direct-spun PSF.
[RISK DISCLAIMER] All opinions, news, analysis, prices or other information contained on this report is provided by analyst of Zhejiang Huarui Information Consulting Co., Ltd (CCFGroup) as general market commentary and does not constitute investment advice. CCFGroup will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
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