Is cotton linter market worth expecting in 2022?

Cotton linter price of China surged to a decade high in 2021, but diving again after the end of Oct. There was large supply gap of cotton linter in 2021 because of recovery of demand from refined cotton, especially sharp increase of cotton linter pulp (CLP)-grade cotton linter in the first three quarters, thus the gap had to be filled by imported cotton linter. Cotton linter import of China grew significantly, hitting second highest level.

VSF price had been hiking since the end of 2020 and there was tighter supply of dissolving pulp as well as paper pulp, so some VSF and cellophane plants increased the consumption of cotton linter pulp. Some cotton linter pulp mills resumed operation accordingly, leading to sharp increase of cotton linter demand.

Cotton linter price hit a decade high by jumping amid tight supply in 2021 because rising commodities affected by inflation kept pushing up cottonseed and cotton linter prices. Coupled with notable growth of refined cotton-grade and cotton linter pulp grade-cotton linter, the widening supply gap further enhanced the tightness of cotton linter supply. However, commodity market gradually cooled down with bigger pressure on the control of coal since the end of Oct and prices of cottonseed and cotton linter dived after peaking amid increasing supply.

In 2022, cotton linter consumed by refined cotton and cotton linter pulp will reduce much, so cotton linter price may be under pressure with less increment of demand, so the price is estimated to be moving down amid fluctuation. However, the emergence of“black swan”events in recent year may cause price volatility or unpredictable changes on the market.