Spandex downstream circular knitting market: diversified

Circular knitting market is another major application filed of spandex. The machine of circular knitting apparently increased since the COVID-19 pandemic. High inflation also affected the consumption outside China. Some export orders were transferred to emerging markets and domestic demand lacked upward momentum. The completion of circular knitting market is intensified in China in 2023. Circular knitting market is obviously diversified in 2023. Firstly, export of circular knitted fabrics and apparels was weak compared with the same period of last year; domestic sales in the first half of 2023 were better than those in the second half of year, and the consumption was worse than anticipated. Secondly, the run rate of circular knitting plants in Chaozhou and Shantou from Guangdong was higher than that in other regions while it was hard to be flat with the first half of 2023 in the second half of year when the market lacked hot sellers. Thirdly, demand for functional fabrics like antibacterial ones was apparently better than that for conventional varieties.

Circular knitting capacity is intensive in China, mainly in Chaozhou, Shantou and Foshan from Guangdong, Xiaoshan and Shaoxing from Zhejiang, Changshu, Changzhou and Jiangyin from Jiangsu and Quanzhou from Fujian etc. Factories mainly use spandex 15D-40D, with some consumption of 70D, 105D and 140D. In the first half of 2023, sales of circular knitted fabrics for yoga clothes, sun-protective clothing and sports underwear and so on were hot and the production of circular knitted double-faced fabric like dralon fabric, jacquard fabrics and fabrics for sweater increased in the second half of year.

As for the average operating rate of circular knitting plants in Zhejiang, Quanzhou of Fujian, Guangdong and Jiangsu, it was at 38% in Jan-Aug, weaker than the performance in the same period of 2021 and slanting high in recent five years. The run rate hit yearly high in Mar when the regulation of pandemic was eased and factories were busy in finishing orders taken before, marginally declined in Apr-Aug and slightly rose in Sep after the production of thick fabrics grew.

Operating rate of circular knitting plants in Chaozhou and Shantou of Guangdong was high in Jan-Aug, 2023, averaged around 60%. Plants mainly produced domestic orders for ecommerce and witnessed good performance in Mar-Jun when sales of fabrics for sun-protective clothing, sports, underwear, and POLO shirt and so on were good. In Jul-Aug, earlier orders were finished and new orders were insufficient. Circular knitted fabric producers saw mounting inventory and tighter capital and were diffident about macro environment and consumption. The run rate of circular knitting plants gradually declined and remained medium in Sep. Circular knitting plants in Foshan, Guangdong mainly produced LYCRA fabric and fabrics for T-shirt in the first half of 2023 and the production of thick fabrics for sweater increased in the second half of year. Local plants mainly use spandex 30D and 40D. The run rate of circular knitting plants in Foshan, Guangdong was mainly at 28.1% in Jan-Aug, 2023, with the lowest capacity utilization rate among circular knitting bases.

Operating rate of circular knitting plants in Xiaoshan and Shaoxing from Zhejiang was averaged at 42.6%, lower than Q4 2020 and the yearly level in 2021, which was the second highest level in recent five years. The competition among conventional varieties is fierce this year. Sales of fabrics such as scuba-knitted fabrics were good in the first half of 2023 and the production and sales of thick fabrics such as jacquard fabrics, Roman fabrics and dralon fabrics improved in Aug-Sep. The run rate of circular knitting mills averaged at 41.5% in Jiangsu, which was also the second highest level in recent five years. The local production of fabrics for yoga clothe was good in 2023 and demand for thick fabrics such as thermal fabrics slightly improved in Aug-Sep.

High-density circular knitted machine rapidly increased in Quanzhou, Fujian. Some produced domestic orders for sportswear and school uniform. The operating rate of circular knitting plants averaged at 39.9% in Jan-Aug, 2023 in Quanzhou, Fujian and moved up in Sep.

With the development of lightweight fabrics and the improvement of people's comfort demand, the additive proportion of spandex in circular knitting fabric is apparently divided, which is at 3-6% in single jersey, milk yarn, printed fabrics and dralon fabric etc. More fabrics have more than 10% of additive proportion of spandex with the development of high-density circular knitted fabrics. The additive proportion of spandex in some fine diner nylon/spandex blended fabrics can be even as high as 30-50%. Spandex even becomes the major raw material in some fabrics. The increase in circular knitting machine and the rise of additive proportion of spandex lay a foundation for two-digit demand growth on spandex market in 2023.