There is a sharp decline in cotton and PSF prices

There is a sharp decline in cotton and PSF prices recently as the fluctuation of major contract has respectively reached 975yuan/mt and 694yuan/mt so far, so the mentality of the textile industry chain has been greatly affected. The commonality of the sharp decline is that the expectations are too full before the Spring Festival, and the recovery after the holiday is insufficient.

Going back to viscose industry chain, although the macro sentiment around the Spring Festival was good, and the increase of cotton and PSF prices was good as well, VSF plants have not fulfilled the expectations like the former two after the holiday, even under the background of low operating rate and VSF price just gained ground by 200yuan/mt. However, in the context of low processing fee and tolerable pre-sale orders, the spinners have witnessed a large price rise of yarns for various technology by 500-1,000yuan/mt.