Some participants think that high price of VSF is the main reason for the shutdown of spinners

Some participants think that high price of VSF is the main reason for the shutdown of spinners, which is one of the reasons and the price of VSF has been pushed up by several factors. The continued rising cost is caused by imported dissolving pulp and cannot be solved by Chinese plants. At the same time, there are continuous orders from spinners, so it is the result of rising sales and price, but the uptrend is finally cut off by weak demand and the Fed’s interest rate hike. The sharp decline in some commodities like PSF and cotton have enhanced panics on the market, so the market participants now expect falling VSF price to release the risks. However, there are still divergences since some downstream plants with higher inventory of finished products and raw materials do not expect price decline, while customers who need to buy materials to cover the minimal requirements expect sharp decline. Under the circumstance that the downward trend is clear, it is necessary to follow the trend, that is, to see how much the decline is and how to appease the customers who have taken orders at high price. In fact, the profitability of VSF is not optimistic at present, and the loss has reached nearly 1,400yuan/mt under full cost, so VSF plants cannot bear the significant reduction of price