VFY export of China posts a y-o-y decline of 26% in Jan-May

VFY sales in China local market slowed down with the traditionally slack season. Traders and downstream plants with increasing stocks of their own replenished stocks on need-only basis. Coupled with more worries over the outlook, there was no high enthusiasm for restocking. In export market, there was no strong performance as well, so the selling pressure of VFY companies has increased somehow.

China exported 6.879kt of VFY (H.S. code: 54033190) in May 2023, a month-on-month increase of 15.91% but a year-on-year decline of 27.28%. In the first five months of this year, the export amounted to 33.139kt, which was 25.67% lower than the comparable 2022 level of 44.587kt. In Jan-May this year, the monthly average export was more than 6.6kt, while in the same period last year, the number was 8.9kt, a decrease of yearly 30% year-on-year. 

The export price kept falling in the past three months from more than $6,000/mt to just above $5,500/mt. The price in Jan-May this year at $5,778/mt was higher than the comparable 2022 level of $5,270/mt. However, the export price in the second half of last year was almost around $6,000/mt.

India and Pakistan are still the top two destinations of China's VFY export, accounting for 70% of total from Jan to May this year. As for origins, Xinxiang Chemical Fiber, Jilin Chemical Fiber and Yibin Grace are the major exporters in China, taking up more than 90% of the total volume.

The export in the second half of year may sustain and is not expected to be much weaker. Whether it can be improved may depend on the restocking in overseas market.