Spandex price review in 2024: under downtrend burdened by supply

The spandex market in 2024 presented a complex situation. On one hand, the supply side continued a capacity expansion trend that has lasted nearly four years, with capacity steadily increasing. On the other hand, while the demand side achieved over 10% growth, demonstrating some vitality, the growth rate remained sluggish compared to the continuously expanding supply scale, and the issue of supply-demand imbalance remained prominent. Against this backdrop, the spandex industry has embarked on a development path that combines expansion and consolidation, seeking to find a new balance amidst dynamic changes.

In 2024, spandex prices continued to decline unilaterally, with no rebound. By the end of December, the prices of spandex 20D, 30D and 40D decreased by 17-18% year-on-year, with conventional specifications of spandex 20D-40D down by 5,300-5,800yuan/mt.

Spandex presented the weakest among major raw materials of textiles and apparels in 2024

In terms of price fluctuations in textile and apparel raw materials in 2024, most was under downtrend, with only a slight increase in the price of rayon yarn 30S. Among these, spandex experienced the largest decline, with the price of 40D dropping by 17.2%. In the first half of 2024, PFY and NFY prices were supported by strong costs and demand, showing a fluctuating consolidation. However, in the second half of the year, the divergence in supply and demand for NFY widened, leading to an accelerated price decline. Throughout 2024, the price of NFY decreased by 16.1% year-on-year, while the price of PFY fell by 7.1% year-on-year.

The price of cotton yarn also saw a year-on-year decline of 7.1% in 2024. Cotton yarn prices followed the downward trend of cotton, which experienced a significant reduction in 2023/24 cotton season. Additionally, with the rotation of state reserve cotton and an increase in cotton imports into China, cotton prices were pushed higher. However, in 2024/25 cotton season, global cotton production is expected to increase, and cotton futures prices began to significantly adjust downward in late Q1, leading to a slowdown in purchasing by textile enterprises and an increase in yarn factory inventories, which resulted in a decrease in cotton yarn prices.

Conversely, supported by strong raw material (viscose) prices, rayon yarn price showed a fluctuating upward trend in 2024, with prices increasing by 6.1% year-on-year by the end of the year, making it a standout in the textile and apparel raw materials market.

Spandex price apparently declined by around 20% on the year in 2024

In 2024, spandex prices continued to decline unilaterally without any rebound. By the end of December, the prices of 20D, 30D and 40D decreased by 17.4%-18.1% compared to the same period of last year, with conventional specifications of 20D-40D seeing price drops in the range of 5,300 to 5,800yuan/mt.

Average price of conventional spandex varieties dropped on annual basis in 2024

The average prices for 20D, 30D and 40D in 2024 were 30,134yuan/mt, 29,134yuan/mt and 26,439yuan/mt respectively, representing year-on-year declines of 15.5%, 15.6% and 15.7%, with the rate of decline significantly narrowing compared to the same period of last year. The price difference between 20D and 40D slightly compressed further.

Analysis of quarterly price of spandex in 2024

In 2024, the average quarterly prices for 20D and 40D showed a marginal downward trend, with the average price in the fourth quarter reaching the lowest level of the year, marking a new low for quarterly averages in many years. In the first quarter, spandex prices were in a narrow adjustment range at the bottom; under a relatively loose supply-demand dynamic in the industry chain, spandex prices remained under pressure, with the average price for 40D reaching 28,393yuan/mt, a quarter-on-quarter decrease of 6.3% and a year-on-year reduction of 16.7%.

In the second quarter, under the pressure from production and sales, spandex prices continued the downward trend. Most domestic homogeneous sources saw significant inventory accumulation, and the price of mainstream products clearly declined, with the average price for 40D in the second quarter reaching 27,294yuan/mt, a quarter-on-quarter decrease of 3.9% and a year-on-year dropping of 11.6%.

In the third quarter, spandex prices struggled to stabilize, with weak support from both the cost side and the supply-demand side. The average price for 40D in the third quarter was 25,759yuan/mt, a quarter-on-quarter decrease of 5.6% and a year-on-year decrease of 15.2%.

At the beginning of the fourth quarter, spandex prices showed signs of stabilizing after a slight halt in the decline, supported by a series of policies such as domestic reserve ratio cuts, interest rate reductions, promotional expenses, and boosts to the real estate and capital markets. The traditional peak season arrived "late," combined with the upward shift in the prices of crude oil and polyester, leading to relative stable price of spandex in October.

However, from November to December, price of spandex was in downward correction with weaker demand from fabric mills, the release of new units and stable-and-weak PTMEG and BDO market. The average price of spandex 40D was at 24448yuan/mt in the fourth quarter, down by 5.1% on the quarter and 19.3% on the year respectively.