Nylon filament low-price turnover improves

In October, the traditional peak season for textiles, the demand for nylon filament did not see a significant boom, yet it was still better than that in September; however, the price trend of nylon remained weak. Downstream buyers were relatively cautious, and nylon filament market only saw lukewarm transactions based on rigid demand.

Entering November, as the peak season was seemingly passing by, the collaborative effect of CPL manufacturers began to show, and prices gradually rose; driven by the increase in raw materials, the trading volume of nylon filament at low prices increased compared with the previous period.

1. CPL collaborative production cuts and price increases: mixed follow-up in mid and downstream

Since the first coordinative meeting of CPL manufacturers on November 5th, news of CPL production cuts and maintenance has gradually increased, and sellers have steadily raised quotations. From the low of 8,050yuan/mt, the cumulative increase has been around 600yuan/mt by Nov 20.

In the early stage of CPL's price hike, nylon 6 bright conventional spinning (CS) chip market saw increased trading volume, and prices followed suit smoothly. Nylon 6 high-speed spinning (HS) chip also witnessed higher trading volume in the low range of 8,800-9,000yuan/mt, with sellers raising quotations to 9,200-9,300 yuan/mt or slightly higher. However, actual transactions were basically concentrated in the range of 9,100-9,250yuan/mt, with resistance to high-price transactions. For some new factory sources, real orders at slightly lower prices were still negotiable, and transaction pressure for HS chip increased after the price hike.

After the rise in raw materials, nylon 6 textile filament manufacturers also tentatively raised prices for customers by 50-100yuan/mt, but downstream resistance was strong-put simply, buyers were not optimistic about the price increase. Only some weaving and knitting factories were willing to increase purchases at low prices or after bargaining, and the purchase volume was mainly to meet short-run rigid demand. Therefore, since the rise in raw materials, nylon filament prices have remained basically stable, with slight discounts still available for some large orders in local markets.

2. Increased low-price transactions, filament factories saw slight inventory reduction

Since some fabric factories appropriately increased purchases at low prices, some filament factories achieved phased destocking, but individual differences were significant. For example, among some filament factories focusing on POY or DTY production during October-November, destocking performance was good, with inventory reduced by 7-10 days; some factories with relatively high operating rates maintained roughly balanced production and sales or saw a slight inventory reduction of 2-5 days; a small number of factories even experienced a slight increase in inventory.

By Nov 20, some filament factories still have high inventories of 50-60 days, normal inventory levels remain around 40-45 days, and a small number have low inventories of 20-30 days or less. Overall, the industry average inventory has dropped from around 47 days (a high level) to around 43 days. After previous purchases, some buyers have adopted a wait-and-see attitude, so there is no sign of sustained destocking among filament factories.

In addition, with the inventory reduction of some filament factories and the good trading performance of some niche specifications recently, the operating rate of filament factories has increased slightly, with the industry average rising from 74% to around 77%. However, individual differences remain large: some factories operate at a high rate of 90% or above, most at around 70-80%, and some at a low level of 50-60%.

Currently, the collaborative production cuts by CPL manufacturers have initially shown an effect in driving up prices, and the price increase has gradually transmitted to the chip segment-with bright CS chip following the rise relatively smoothly, while some HS chip sources have encountered resistance to continuous price hikes. The impact of rising raw materials on nylon filament is mainly reflected in increased low-price trading volume and a moderate reduction in filament factories' inventory. However, downstream weaving and knitting factories' own orders have not continued to improve. Considering that filament factories generally still have high inventories and sufficient supply, buyers are not optimistic about the sustainability of this round of raw material price increases. Therefore, there is strong resistance to nylon filament price hikes at present, with most adopting a wait-and-see attitude.