PriceWatch Report Highlights 30 August 2010

Polyester Chain | Nylon Chain | Acrylic Chain | Viscose Chain | Others

Monthly analysis of Spun Yarn Exports from India: YnFx Yarn ExportWatch

		Polyester Chain
	Polyester Staple Fiber Price Trends   With upstream PTA and MEG prices fluctuating slightly the cost pressure on polyester staple fibre producers eased a bit. However, demand from downstream spun yarn markets was weak and as it made normal replenishment for feedstock. Inventories with PSF producers were reportedly low and spot supplies were less available. In China, restriction on power in Zhejiang has become bane on the market. However, in coming weeks will see PSF market ranged bound and demand improving slightly.     Polyester Filament Yarn Price Trends   Polyester filament yarn prices in China continued their downtrend while other Asian markets were calm and prices rolled over previous week’s numbers in Pakistan, Malaysia/Indonesia and India. In China, the Jiangsu PFY market saw sporadic price hikes while in Shengze, local major quoted flat. However, the offers for FDYs of some specs were pegged at higher price due to the turnaround of units. In Zhejiang, PFY market also saw slower rises with only sporadic increases.     Purified Terephthalic Acid Price Trends   Asian PTA spot markets were apparently dull this week and prices softened slightly. At the beginning of the week, contracts were settled slightly higher beyond expectations leading to uptrend in market sentiment. The slight upward correction in paraxylene prices the cost support was limited to PTA. In China demand was affected by the power restrictions in Zhejiang, as PET plants were operating on lower run rates. The PTA market is likely to continue to see corrections in the coming weeks.     Paraxylene Price Trends   Asian paraxylene prices underwent upward correction this week while European numbers regained its past week’s losses. The rise in naphtha and crude oil prices at the end of the week raised sentiments of paraxylene markets. Supplies in Asia are slated to increase as Urumqi Petrochemical\'s paraxylene plant construction was completed in July and is now under trial run. It is expected to come into commercial production in October.     Polyester Chips - Fiber Grade Price Trends   The polyester chip markets in Asia continued the weak fluctuation and prices tumbled again. Influenced by drops of downstream polyester filament yarn market, negotiations declined. Supported by demand from replenishment at the end of the month semi dull chip prices were seen inching up slightly. Bright PET chip market stayed on a par with semi dull but was dominated by weak corrections. CDP market continued to see corrections, with trading prices declining slightly by the week end.     Monoethylene Glycol Price Trends   MEG prices were stable in Asian markets this week as crude oil futures hovered in the range of US$70-75 a barrel and ethylene prices continued its uptrend. Supplies were ample as cargoes were still arriving. Demand for MEG particularly in China is likely to decline as run rates of downstream polyester segment will inch down on power restrictions in Jiangsu and Zhejiang. In coming week, MEG prices are likely to see downward correction.     Ethylene Price Trends   Asian ethylene prices started rebounding on mid-August as end-users actively started buying spot ethylene cargoes for downstream production. The markets became more bullish this week, as multiple unplanned steam cracker outages tightened the spot supplies. On Thursday, Japan\'s Mitsui Chemicals shut its 600,000 ton naphtha cracker due to a mechanical problem. In Singapore, Shell shut its 800,000 ton naphtha cracker on Tuesday for a day but was still operating at low rates.

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		Nylon Chain
	Nylon Filament Yarn Price Trends   Nylon filament yarn markets were quiet this week while prices of some specs changed moving upwards on support of rising input costs. Inventories of some specs were low to support their values. In China, major producers were prudent about running, with operating rates at 50-60% capacity due to power restrictions, partially tightening supplies. Downstream textile mills were also running at low capacity in general, resulting in modest buying interest.     Benzene Price Trends   Benzene prices were subdued this week in Asian and European markets on dismayed oil prices during the week. However, crude price rebounded handsomely at the week end which would influence benzene market in coming week. In USA, tight supplies pushed benzene prices further up, thus opening the arbitrage window to Asian traders. Last week, the markets had opined that the drop in crude oil prices in that week will impact benzene numbers ahead.     Polyamide Chips Price Trends   Nylon chips market sentiment remained positive and firm caprolactum formed stronger cost support to chip market. Chips prices firmed up this week, as cost pressure on producers was high and both traders and producers kept low inventories and had few low-cost materials. However, the price increase was marginal as downstream nylon fiber producers were buying cautiously and had kept operating rate low. Due to higher feedstock cost and balanced supply and demand fundamentals, nylon chip markets are expected to remain stable-to-firm in coming weeks.     Caprolactum Price Trends   Caprolactum prices were almost stable as the market remained calm focusing on the downtrend in crude futures early this week and then later rebounding at the week-end. Feedstock benzene market too made corrections in Asia. Caprolactum supplies were normal and healthy as overall operating rates were high though some unit in Poland was shut for turnaround. Overall, demand was stable. In coming weeks, caprolactum markets are expected to remain stable-to-firm.

		Acrylic Chain
	Acrylic Staple Fiber Price Trends   The Asian acrylic staple fibre markets were bearish this week as demand was hard to improve given the expectations of supply expanding. In China, acrylic spinning mills found difficult to ramp up operations due to power restrictions and lack of labors. As the expected weakness and the sharp downward settlement, spot prices too declined. Upstream acrylonitrile prices too were narrowly ranging bound but could not provide a lasting support. Coming weeks, sentiment is however, expected to remain stable.       Acrylonitrile Price Trends   Feedstock, propylene prices shot up this week due to tight supplies and passable demand from downstream market. This was a good support to acrylonitrile market, but prices were sluggish despite the supply was normal. The Asian markets were expecting more cargoes to arrive in late September compared to August. In short term, the markets may see many negative factors amidst stable demand but oversupply would exert pressures and the markets will in a stable-to-weakening trend in coming weeks.       Propylene Price Trends   Propylene Asian spot prices remained firm this week, with supply limitations pushing prices higher despite sluggish crude oil prices. Meanwhile, spot propylene prices in both Europe and the US were mostly stable during periods of relatively limited market activity. Supply is reportedly particularly tight in NE Asia, although buyers in SE Asia were also complaining of limited supplies as propylene sellers within the region are diverting their cargoes to NE Asia where higher prices are obtainable.

		Viscose Chain
	Viscose Staple Fiber Price Trends   The Asian viscose staple fibre markets prices were ranged bound this week. In China, prices inched up as downstream were markets were stimulated by rumors of price-hike. However, the new-price hike was unsatisfying, and buyers were mostly consuming their inventories as it needed more time to accept the higher value goods. During the week, owing to sharply run cuts in Jiangsu and Zhejiang given power restrictions prices for downstream spun rayon yarn showed signs of rising.       Viscose Filament Yarn Price Trends   Indian and China viscose filament markets were stable this week. Reportedly, liquidity in China generally improved from previous week and price realization continued to inch up. However, prices were still in disorder, as some producers and traders held stocks to further adjustments. However, the markets restrained the earlier upward but in coming weeks producers would be able to hike offers given the balanced demand supply position.

		Others
	Naphtha Price Trends   Asian naphtha price rose to a week-high at the end of this week, with cracks recovering marginally despite a well supplied market. A closed arbitrage window caused stronger demand for spot European market. The short-covering in Asia although temporarily supported sentiment, keeping crack spreads above US$100 a ton. Middle East spot cargoes are anticipated to keep coming.       Crude Oil Price Trends   Crude oil prices declined sharply beginning this week as poor economic news dominated the markets and prices dropping below US$72 a barrel mark at the beginning of this week. US housing data showed sales both of existing homes and new homes registering significant drops. Mid-week, the US Energy Information Administration reported that crude oil inventories rising 4.1 million barrels, much more than the 1.1 million-barrel consensus forecast. However, oil prices recovered after Federal Reserve chairman Ben Bernanke announced that the Fed was ready to do whatever it takes to support economic recovery.       Wool Price Trends   The Australian wool market was sober this week and prices inched up from previous week’s level. The softness indicated that demand although was strong but not enough to keep the market up. The EMI was up Aus cent 4 to Aus$8.78 a kg while in US$ terms it lost US cents 8, ending the week at US$7.78 a kg. The North Australia index closed at US$7.95 a kg, while West Australia was at US$7.89 per kg. The South Australia Index closed at US$7.55 a kg.       Cotton Price Trends   Cotton prices movements were mixed this week with US and Indian markets report rise in prices while those in Pakistan and China declining. The October Futures closed the week at US cents 89.03 per pound, gaining US cents 1.88 while the Cotlook ‘A’ index gained US cent 1.95 at US cents 94.00 per pound at the end of this week. The East Texas and West Texas cotton increased US cent 1.50 more than regaining previous week’s loss.