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Spandex: This is a sunny but uncertain weaving season!

[168TEX News] The fruitful “Golden Nine and Silver Ten” are the traditional weaving peak season that people are looking forward to. However, this year’s “Golden Nine” did not bring…

[168TEX News] The fruitful “Golden Nine and Silver Ten” are the traditional weaving peak season that people are looking forward to. However, this year’s “Golden Nine” did not bring much relief and gain to the spandex industry. Negative news such as prices reaching new lows, profits continuing to suffer heavy losses, and equipment being carefully overhauled have always been a dark cloud over the spandex industry.
It can be seen that this is a sunny but uncertain weaving season!
In terms of price, the market weakness of spandex raw material PTMEG and pure MDI remains unchanged. The market price basically fell in early September, and the trend remained weak after the middle of September. As of now, the focus of transactions has dropped by 400-900 yuan. . As the overall weaving industry is “golden but not gold”, downstream demand continues to be weak, and market confidence is insufficient under the oversupply pattern. It is expected that the growth rate of raw material procurement by downstream enterprises will be limited in the future, or it may still be limited to rigid demand.

In addition, the market price of spandex products has reached new lows. Among them, the prices of 20D and 40D have dropped by about 1,000 yuan compared with the beginning of September, and the mainstream negotiation range of 30D is 40,000-46,000 yuan/ton. At present, the downstream weaving industry still lacks confidence in the “Silver Ten”, and it is expected that the market demand will be difficult to increase. The situation of spandex yarn is not good, and the market price may continue to bottom out.

In terms of profit, the profit of spandex can reach tens of thousands of yuan at the peak, but after more than a year of decline, spandex is now almost profitless. Among them, the spandex business of listed companies was also severely damaged due to the continued decline in the economy. Currently, Taihe New Materials released the third quarter report of 2015. During the reporting period, the company achieved a net profit of 26.0075 million yuan, a year-on-year decrease of 27.82%; from January 2015 to In September, the company achieved a net profit of 81.7151 million yuan, a year-on-year decrease of 35.37%. The decline in this part of profits is mainly caused by falling prices.
In terms of equipment, many companies have suspended production for maintenance in September due to the sluggish market. Among them, the Jining Ruyi spandex unit has stopped production for maintenance, and the maintenance of some equipment that was originally operating normally will last for about a month. Hangzhou Schulze’s spandex production line, which was initially shut down, was restarted on September 18 and resumed normal production. Zhejiang Huahai’s spandex production line was restarted at the end of the month after being shut down for nearly three months. Shaoxing Longshan spandex production line equipment will be temporarily shut down for maintenance on September 30, and normal production will resume in early October.
In terms of business investment, in order to broaden sales and seize market share, Woori Holdings announced on September 14 that the company plans to use its 65.71% stake in Shuangliang Spandex and 75% stake in Woori Special Fiber after evaluation. We will invest in the future value and establish a wholly-owned subsidiary in Jiangyin City. The wholly-owned subsidiary will carry out asset management, capital management, foreign investment, sales and research and development of differentiated chemical fibers and spandex high-tech chemical fibers and other businesses. In terms of foreign companies, Japan’s Asahi Kasei and its partner Taiwan Plastics Industry are building fiber factories for sportswear in Taiwan. The plant is scheduled to start construction this year and begin operations in 2017. The investment will be less than 3 billion yen, and the polyurethane elastic fiber production capacity is expected to be 3,000 tons/year. Large companies are opening up new territories one after another, which shows that market competition is increasing.

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Author: clsrich

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