test


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

login CCFGroup App

Insight | Time: Mar 17 2021 5:59PM
Nylon 6 CS chip: an initiator of the industrial decline
 
Text size
Nylon 6 CS chip was the first product declined in nylon industrial chain

As a product with the highest percentage of spot trading, nylon 6 conventional spinning (CS) chip market has been almost the most alert product during a volatile trend. In the historical trend, CS chip market has been leading product in price decline and increase. In the insight report Nylon 6 CS chip into intensive profit-taking sales released on March 2, the website has stated that nylon 6 CS chip market had stabilized after rapid increase since Feb 19, and sellers began to sell stocks actively at the profit-taking rate.

This "intensive profit-taking sales" window has ended after two weeks consolidation, and nylon 6 CS chip prices started falling sharply since Mar 9 to 14,100yuan/mt, close to the rate beginning the market after the Chinese Lunar New Year holiday (13,900yuan/mt on Feb 19).




 1.Nylon 6 CS chip market soared up 1,300yuan/mt or 10.32% after the market reopened on Feb 19.
 2.Steep increase continued until Feb 26, hitting a ceiling of 15,100yuan/mt, up 1,200yuan/mt or 8.63% from Feb 19.
 3.Market consolidated at 15,000-15,100yuan/mt during Feb 26-Mar 9.
 4.Price declined since Mar 9 by 900yuan/mt or 6.62% until Mar 16.

CS chip plants cut operation in heavy losses and accumulated inventory

As nylon 6 CS chip market dropped the most along the industrial chain, when CPL and nylon 6 HS chip market were both relatively flat, the margin for CS chip plunged heavily to negative zone in mid-Mar, touching deep below 1,000yuan per ton by Mar 16.

Although CS chip plants were delivering their stocks actively at lower rates, trading lingered sluggish. As downstream manufacturers would chose to wait and consume previous stocks, as the overall chemical and fiber industry was in a bearish sentiment. Traders, more flexibly, had chosen to dump stocks in previous term to prevent risks. Thus inventory outside nylon 6 CS chip plants was pressed to low while that in CS chip plants increased.

According to plant survey, inventory of nylon 6 of CS chip plants further accumulated over the consolidation period by 2.5 days to 12 days by Mar 12. And this trend seemed to be continuing in short.



Considering inventory pressure and other risks, nylon 6 CS chip plants began to cut down operating rate since Mar 9. Operating rate of industrial-grade chip (CS chip) plant had dropped 7% week-on-week at 78% by Mar 17, as Fujian Sinolong, Jiangsu Haiyang and Jiangsu Hongsheng all cut their production.


Note: nylon 6 textile chip = nylon 6 HS chip, nylon 6 CS chip = nylon 6 industrial chip

The production cut seemed to be an only option for CS chip plants, who had suffered great loss in February 2021 and would try their best to narrow down deficits in March 2021. And this would only be a start of the industry, as CS chip market contributed to almost half of caprolactam consumption. The influence would gradually derive from CS chip market to CPL as a direct feedstock, and other sectors relating to CPL market, including nylon 6 HS chip and textile filament.
[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.
Related Articles
Nylon market morning express (Apr 21, 2021)
China nylon market snapshot (Apr 21, 2021)
Petrochemical market morning express (Apr 21, 2021)
Nylon 6 chip market daily (Apr 20, 2021)
Caprolactam market daily (Apr 20, 2021)
Nylon market morning express (Apr 20, 2021)
Sinopec, Shenyuan & Nanjing Fibrant raise CPL Apr contract
China nylon market snapshot (Apr 20, 2021)
Petrochemical market morning express (Apr 20, 2021)
Caprolactam market daily (Apr 19, 2021)
 
Research
China's PTA industry moves forward under overcapacity ...
China chemical fiber industry development and outlook
Bullish cotton yarn market coming to an end?
Cause of soaring cotton linter and refined cotton and the ...
Application of direct-spun PSF in nonwoven fabric market
 
 

浙公网安备33010902000742号