cash flow of acrylic fiber has turned negative since ACN price moved up by 900yuan/mt after the holiday

Viewed from the price of raw materials, cash flow of acrylic fiber has turned negative since ACN price moved up by 900yuan/mt after the holiday. And considering the settlement of ACN in February, which is likely to increase to over 11,000yuan/mt, the cash flow of acrylic fiber will reach about -665yuan/mt (calculated on the processing fee of 6,000yuan/mt). Therefore, the early market rumors of a 500yuan/mt rise in AF price is obviously not enough for acrylic fiber to maintain actual profit. Of course, this round of ACN price increase is partially attributed to the unexpected shutdown of Lihuayi’s unit, which lasts for 5-7 days. Therefore, the overall price hike of AF will be higher than previously estimated. With regard to the current cash flow of acrylonitrile, its theoretical cost is about 10,600yuan/mt. Yet, the operating rate of the industry is only about 73% so far, thus the regained profits of ACN may stimulate the restart of some idle capacity. In addition, parts of market players are hyping up the start of the 200kt ACN unit under Hainan Fine Chemical Industry. This, coupled with the restart of Lihuayi's ACN line during the weekend, have led to greater possibility of a slight decline of ACN price.