Rayon grey fabric shows positive momentum after the Spring Festival?

Rayon grey fabric demand was not robust in 2023, with prices slipping in fluctuation. This was mainly due to the increase in the operating rate of weaving mills after the relaxation of epidemic prevention policies, which was over 7 percentage points higher than that of 2022 at around 55% in 2023. Under the condition of strong supply but weak demand, market competition has intensified, and the market situation for the whole year was not as good as expected.

The overall profitability of rayon grey fabric mills in 2023 was around the cost line, and that of weaving mills was largely within 0-0.10yuan/meter, with some products or periods up to about 0.15-0.20yuan/meter. As the epidemic policies were optimized, there was a high expectation of recovery in the market, but the actual trend was significantly lower than expected. The most significant reason was the weak consumption in Europe and the United States under the pressure of high inflation, and most enterprises turned to Chinese domestic orders by lacking significant support from orders outside China.

However, with the expectation of "Golden March and Silver April" as well as the stocking up before the Spring Festival, rayon yarn price had risen significantly since mid-Dec, especially open-end and vortex-spun yarn, thus rayon grey fabric price followed up as well. After sales had improved in late Dec, the overall inventory of the viscose industry chain was not large. The trading volume of weaving mills was gradually increasing with offers going up, and a good start after the holiday was worth noting. But since part of the demand was already pulled forward, the increment and duration of post-holiday grey fabric price increase still needs observation.