Nylon 6 bright CS chip market may improve in Q4 2025

With CPL prices falling before the holiday, the processing margin for chips has slightly expanded, which is conducive to pre-holiday sales and has provided some breathing space for chip plants.

As nylon 6 factories lower prices and cut production, and downstream gradually enter the traditional Peak Season, the fundamentals of nylon 6 bright conventional spinning (CS) chips have shown some improvement. This improvement is likely to continue into the fourth quarter of 2025.

First, bright CS chip inventory has reduced. Due to persistent pressure from low processing fees, nylon 6 bright CS chip plant have restrained their operating rates. CS chip plants, from North to South China, had some maintenance shutdown or production cut in the third quarter, with the average operating rates consistently hovering low at around 80% or slightly above. The effective supply-side management has gradually improved the inventory situation, despite sluggish market and weak downstream stocking enthusiasm.

By the end of September, mainstream bright CS chip plants generally had low inventory levels. Due to bearish expectations for the market, a significant portion of plants have even maintained a certain level of oversold positions (pre-sales). The effective control of visible inventory will create conditions for further recovery in prices and processing fees in the fourth quarter of 2025, similar to the trend observed in Q4 2023.

Second, the overall demand situation is relatively favorable for bright CS chips. Downstream industries such as engineering plastics, staple fiber, and cord fabric are expected to enter their peak demand seasons of the year, particularly the engineering plastics sector. The performance of processing fees in the fourth quarter over the past two years aligns with this trend, showing a rebound compared to the average processing fees in Q3 of the same year.

From the perspective of downstream market in 2025, nylon industry overall faces pricing challenges. The textile-related high-speed spinning (HS) chip market is overwhelmingly one-sided pressure. However, bright CS chip market has demonstrated greater resilience, with feedback focusing more on price issues rather than volume.

Based on the above analysis, nylon 6 bright CS chip market is expected to have some opportunity for improvement in the fourth quarter of 2025. The startup of new plants may pose certain constraints, but the additional capacity coming online in Q4 is relatively limited. With downstream inventory levels currently on the lower side, if supported by some favorable factors, prices may see a rebound.