Acrylic fiber price direction in May, 2021

There is a topic on the market currently that acrylic fiber prices will climb up in May. Some market players have doubt about this, as it may be proper to stabilize prices for a while after a sharp fall of 2,500yuan/mt. We consider that this shall be concerned from the actual situation.

Eyes shall be put on the profits first By end Apr, acrylic fiber profits have turned from positive to negative after large price fall, and the deficits reach about 1,000yuan/mt. Considering the production cut and lower operating rate, the actual losses may be larger. Producers are unwilling to sell mostly with losses, and the most direct method to improve the cash flow is to raise the prices. Therefore, it is rational to raise prices in May.

Another way is to lower feedstock costs. As ACN plant inventory sees no obvious pressure, it is risky to lower the acrylic fiber costs by lower ACN prices. In Apr, ACN prices saw rapid decline first, but prices rebounded later with the impending settlement prices, and finally, the settlement prices have not reached the expectations of market players.

After acrylic fiber prices fall down, acrylic yarn inventory reduces somewhat, but some spinners still reflect that the inventory has not reduced much, and orders are ordinary. With the impending slack season, the orders may be hard to improve obviously later.

Therefore, the acrylic fiber price trend and the increment may depend on the decrement of ACN prices. According to current acrylic staple fiber prices, acrylic fiber market may be at the cost line when ACN price declines to around 13,500yuan/mt. If ACN settlement prices are higher than this level, acrylic fiber prices may be adjusted according to actual situation.