As is known to all, spandex has always been regarded as the "seasoning" of textile products in the industry. If we compare textile products to a table of rich and delicious dishes, then spandex plays the role of monosodium glutamate which is used in small amounts but indispensable. It is precisely because spandex is the "monosodium glutamate" of textiles that its demand has a very close linkage effect with other textile raw materials. It is understood that about 70% of China's chemical fiber textile exports contain spandex components (content is 3% -- 18%). This shows that the price increase ability of the spandex industry is stronger than that of other products. In 2010, the price increase of spandex fiber raw materials in China was relatively small compared to other raw materials in the textile industry. Therefore, reviewing the spandex industry in China in 2010, overall, the spandex industry performed well and the domestic spandex market trended upward.
What troubles some spandex enterprises more is that the originally agreed-upon intention for a unified price increase of spandex products appears so pale and powerless under the actual circumstances of a sluggish market and product overstock, leading to its inevitable collapse.
In fact, due to the different production methods adopted by China's spandex production enterprises, there are certain cost differences between enterprises' products. Although this gap in spandex production costs does not appear large, it inevitably causes instability in the domestic spandex fiber market prices at that time. Meanwhile, in the second half of 2010, China newly built and continuously put into operation a batch of spandex production lines. This objectively increased the supply of spandex raw materials in the domestic market, further deepening the supply and demand balance in the spandex industry.
Under such circumstances, some enterprises that had "principally" approved the unified price increase of spandex products secretly began their own discount sales plans. However, face-saving efforts were still necessary. At that time, these spandex production enterprises adopted ostentatious "preferential" sales measures. Therefore, although the price of spandex fibers appeared stable from June to October 2010, in reality, the price of spandex fibers was in a basic downward trend.
The "miracle" occurred in November 2010. On the 4th, another coordination meeting of the spandex industry was held in Shaoxing, bringing a bit of vitality to the domestic spandex market which was originally in the off-season. However, downstream dealers and textile enterprises responded rather passively, continuing to purchase according to needs. However, a week after this meeting, the raw materials of China's textile industry basically started to soar. Under such an atmosphere, the raw materials of the spandex industry also inevitably saw a significant rise.
However, the downstream textile enterprises of the spandex industry did not "buy into" this. The main reason was that the domestic market demand for spandex fibers and their finished products did not significantly increase at that time. Moreover, on the international market, the export of China's spandex fibers and their finished products remained stagnant. Therefore, most domestic textile enterprises were still operating at low capacity, with insufficient production. Additionally, textile enterprises continued to adopt a suppressive attitude towards upstream spandex fiber production enterprises. They tried to use inventory spandex raw materials as much as possible and followed the principle of purchasing spandex raw materials according to needs. This directly caused the situation of oversupply and low prices in the entire spandex market at that time.
China's textile industry started late in the production of spandex fibers, but the development speed of the entire industry is very fast. According to relevant department statistics, by the first half of 2010, there were a total of 76 large-scale spandex enterprises in China. At the same time, the average scale of spandex enterprises far exceeds the average level of the entire textile industry. This reflects that China's spandex industry has many large enterprises, concentrated high-quality production capacity, and a smaller proportion of backward production capacity. The overall development momentum of the entire industry remains relatively healthy.
Spandex is an elastic fiber, scientifically named polyurethane fiber, and has been simply referred to as "spandex" in China. In 1937, spandex was first successfully developed by Germans, and in 1959, American chemical fiber enterprises successfully achieved the large-scale industrial production of spandex. Spandex has high elasticity and can be stretched 6-7 times, quickly returning to its original state when tension dissipates. In fact, in the textile clothing industry, spandex is generally not used alone but is mixed in small quantities into fabrics. This fiber has both rubber-like properties and fiber characteristics, mostly used in core-spun yarns with spandex as the core, called elastic core-spun yarns. Currently, spandex is widely used in knitted goods, bandages, socks, underwear, jeans, and other fields.
In 1989, a textile enterprise in Yantai, China, was the first to start producing spandex domestically. Currently, the production methods of spandex mainly include dry-spinning, melt-spinning, wet-spinning, and chemical reaction methods. However, no matter which production method is used, the huge impact on the environment cannot be avoided. With economic development, China now has an annual production capacity of more than 350,000 tons of spandex, becoming the world's largest spandex producer.
From the perspective of the main raw materials for spandex production, the price of polytetramethylene ether glycol (PTMEG) rose from 26,000 yuan/ton at the end of October to 28,000 yuan/ton at the end of November, an increase of 7.7%; the price of pure isocyanate (MDI) also rose from 18,000 yuan/ton at the end of October to 20,300 yuan/ton at the end of November, an increase of as high as 12.8%. At the same time, international oil prices related to the chemical fiber industry also showed an upward trend. Thus, the price increase of spandex fibers became an inevitable and necessary action.
In the first half of 2010, due to the influence of the international financial crisis not being completely eliminated, the export volume of spandex products did not significantly increase. Therefore, the price of spandex fibers remained relatively low. At this time, the price of one of the main raw materials of the spandex industry, polytetramethylene ether glycol (PTMEG), remained high. This caused the abnormal phenomenon of inverted prices between raw materials and finished products in the entire spandex industry. Subsequently, the prices of the other two main raw materials required for spandex production, isocyanate (MDI) and dihydroxybutane (BDO), also began to gradually rise. Under the pressure of continuously rising raw material costs, domestic spandex production enterprises could not help but begin planning a price increase for spandex fibers.
Coincidentally, by June and July 2010, due to energy conservation and emission reduction tasks, some local governments began to implement controversial "power cuts and electricity restrictions" on spandex production enterprises. This measure directly caused a significant reduction in domestic spandex production at that time. Meanwhile, domestic spandex industry coordination meetings were also being actively held. This meeting not only determined the inspection dates of various spandex production enterprises within the industry, leading to a hard decrease in the output of spandex fiber products, but also established the principle intention of a unified price increase for spandex products to avoid losses. All these situations and intentions seemed to indicate that the price increase of domestic spandex fiber products was already a foregone conclusion.
This article comes from Global Textile Network. Please indicate the source if reprinted!