This week (January 29 to February 4, 2024), adhesive short fiber manufacturers had no pressure on inventory, and their quoted prices were relatively firm. Manufacturers were reluctant to sell, resulting in a slight increase in prices. As the Spring Festival approaches, the market has a holiday atmosphere and transactions are light. The overall stability of downstream cotton yarn is relatively strong, with an overall increase in sales. The prices quoted by yarn factories have slightly increased, discounts have been slightly reduced, and the operating load has decreased. Inventory has been basically maintained.

According to the Commodity Market Analysis System of Business Society, the overall price of viscose short fibers remained stable and increased this week (January 29 to February 4, 2024). As of February 4th, the domestic factory quotation for 1.2D * 38mm adhesive short fiber is 13180 yuan/ton, an increase of 120 yuan/ton or 0.92% compared to last week.

In terms of cost: This week (January 29 to February 4, 2024), the price of raw material dissolved slurry remained stable, and cost support remained strong. The price of imported broad-leaved dissolved pulp is around 880 US dollars per ton, and the price of coniferous dissolved pulp is around 910 US dollars per ton. At present, the production of dissolved slurry in Hunan and Shandong facilities in China is priced at around 7400 yuan/ton, with a slight decrease in price. Actual orders are being negotiated.

Supply and demand: This week (January 29 to February 4, 2024), the operating rate of the adhesive short fiber industry has remained basically stable, and the overall industry load is currently around 82.8%. As the Spring Festival approaches, the market has a holiday atmosphere for trading, with light transactions and no inventory pressure on manufacturers. The human cotton yarn factory mainly consumes inventory, and the enthusiasm for replenishment has increased. The human cotton yarn is stable and relatively strong. The supply of low-priced goods in the market has slightly decreased, but the overall improvement is still limited, and market confidence is still insufficient.

Downstream cotton yarn market

From January 29 to February 4, 2024, the overall market for human cotton yarn remained stable and strong, with some yarn factories offering slightly higher prices and slightly reduced discounts. Overall shipments were average, but as the Spring Festival approached, the operating load of human cotton yarn slightly decreased to around 66%, and inventory was basically maintained. As of February 4th, the average ex factory price of human cotton yarn (30S, ring spun, first grade) was 17375 yuan/ton, an increase of 50 yuan/ton or 0.29% compared to last week.

Future Market Forecast

The price center of raw material dissolution pulp is strong, with strong cost support. Downstream cotton yarn factories are approaching the holiday period, and their enthusiasm for replenishment is not high. The trading atmosphere in the viscose short fiber market will be light. The market lacks confidence in the later stage and is bearish on the market before the Spring Festival. As the Spring Festival approaches, textile machinery manufacturers are taking a break one after another, entering a situation of price without market. Analysts from Business Society predict that the market for viscose short fibers and artificial cotton yarn will continue to stabilize and operate in the short term.

This week, the acrylic acid market remained stable with some gains. According to the Commodity Market Analysis System of Business Society, as of February 2nd, the average quoted price of acrylic acid in East China was 6187.50 yuan/ton, an increase of 0.20% compared to Monday (January 29th).

Factors affecting the price of acrylic acid:

Cost side: According to the commodity market analysis system of Shengyishe, the reference price of propylene on February 1st was 6843.25, a decrease of 0.36% compared to January 1st (6868.25). Recently, the price of raw material propylene has been weak, and the impact of cost on the acrylic acid market is limited.

Supply and demand side: There is not much inventory pressure on the supply side, which supports the mentality of enterprises to raise prices. Downstream procurement is cautious, with a focus on following up on just the right amount of demand. The market has a strong wait-and-see atmosphere, and with the support of the supply and demand side, the focus of negotiations in the acrylic acid market is stable but rising.

According to analysts from Business Society, as downstream pre holiday stocking gradually approaches its end, the market atmosphere may gradually slow down. It is expected that the acrylic acid market will remain stable in the short term, and more attention still needs to be paid to market news guidance.

According to the monitoring of the commodity market analysis system of Business Society, the price of activated carbon at the beginning of this week was 11666 yuan/ton, and the price of activated carbon over the weekend was 11666 yuan/ton, indicating stable prices.

Domestic activated carbon manufacturers have remained stable in their quotations. As the Spring Festival approaches, manufacturers have gradually suspended production. The ex factory price of activated carbon for coconut shell water purification in East China ranges from 9500 to 12500 yuan/ton, and market sales have slowed down. Prices are sideways, with a focus on post holiday market transactions.

Coconut shell charcoal has a certain amount of sales in areas such as gold extraction, water purification, and filter cartridges, especially gold charcoal, which receives more inquiries from the African market; The supply of fruit shell charcoal with medium to low indicators is smoother. There is a recent rebound in imported carbonized materials, and the industry can pay more attention to it.

Prediction: Activated carbon manufacturers have gradually stopped reporting, and market transactions are weak. It is expected that the price of activated carbon will mainly fluctuate in a narrow range in the short term.

According to the Commodity Analysis System of Business Society, the average price of tetrahydrofuran in the mainstream domestic market fluctuated and increased in January. The price of tetrahydrofuran increased from 12925 yuan/ton at the beginning of the month to 13000 yuan/ton at the end of the month, an increase of 0.58%, and the price at the end of the month decreased by 7.51% year-on-year.

From the supply side perspective, the prices of mainstream domestic tetrahydrofuran distributors have fluctuated this month, with average inventory levels.

From a cost perspective, the maleic anhydride factory mainly executes early-stage orders, with overall average market trading and weak market conditions. The market price of maleic anhydride dropped significantly in January, dropping from 7860 yuan/ton at the beginning of the month to 7199.80 yuan/ton at the end of the month, a decrease of 8.40%, and a year-on-year decrease of 3.23% at the end of the month. The domestic market for 1,4-butanediol is stable and experiencing a downward trend, with rigid contract trading and light spot trading. In January, the market for 1,4-butanediol slightly declined. The price of 1,4-butanediol decreased from 9535.71 yuan/ton at the beginning of the month to 9421.43 yuan/ton at the end of the month, a decrease of 1.20%. The price at the end of the month decreased by 24.39% year-on-year. The upstream raw material market prices have dropped significantly, with insufficient cost support. Due to the impact of supply and demand, the price of tetrahydrofuran has been negatively affected.

From the demand side, as the Spring Festival approaches, downstream textile factories will enter a holiday mode, which will further weaken their procurement of raw materials. The market price of spandex slightly decreased in January. The price of spandex decreased from 32125 yuan/ton at the beginning of the month to 31500 yuan/ton at the end of the month, a decrease of 1.95%, and the price at the end of the month decreased by 11.89% year-on-year. The downstream spandex market price has slightly declined, and downstream customers have weakened their enthusiasm for purchasing tetrahydrofuran.

Looking at the future: In mid to early February, the domestic tetrahydrofuran market may experience a slight fluctuation and decline. The upstream maleic anhydride market has experienced a significant decline, with insufficient cost support. The downstream spandex market has slightly declined, and downstream demand has weakened. Business Society’s tetrahydrofuran analyst believes that in the short term, the domestic tetrahydrofuran market may experience slight fluctuations and declines due to various factors such as supply and demand and raw materials.

According to the Commodity Market Analysis System of Business Society, the domestic heavy rare earth market prices have significantly declined. On January 29, the rare earth index was 398 points, a decrease of 60.48% from the highest point of 1007 points in the cycle (2022-02-24), and an increase of 46.86% from the lowest point of 271 points on September 13, 2015. (Note: The cycle refers to 2011-12-01 present)

The price trend of domestic dysprosium oxide, dysprosium iron alloy, and metallic dysprosium has significantly declined. As of the 30th, the price of dysprosium oxide was 1.93 million yuan/ton, with a monthly price decline of 22.18%; The price of dysprosium ferroalloy was 1.925 million yuan/ton, a decrease of 22.06% in price; The price of dysprosium metal is 2.405 million yuan/ton, with a price decline of 24.25%; The domestic price of terbium series has declined, with the domestic price of terbium oxide at 5.7 million yuan/ton and the price of metallic terbium at 7.1 million yuan/ton.

In January, the prices of heavy rare earths in the market fell. Recently, there have been limited transactions in the rare earths market, with few new orders and low purchasing willingness of enterprises. Some enterprises have recently lowered their negative guarantee prices, putting pressure on metal spot transactions. Downstream magnetic material enterprises have seen a decline in production, with only 30% of production. Some magnetic material enterprises have started to take a break, and overall production has declined to below 50%, mainly due to inventory consumption. In addition, the procurement of waste recycling is not active, and the overall market support is insufficient. The pessimistic sentiment has intensified, and the trend of the heavy rare earth market has significantly declined. The total control indicators for the third batch of rare earth mining and smelting separation in 2023 are 15000 tons and 13850 tons, respectively. Generally, two batches of indicators are announced each year. The third batch of indicators in 2023 will increase mining volume, which is detrimental to the domestic rare earth market.

According to statistics, in December 2023, the production and sales of new energy vehicles reached 1.172 million and 1.191 million respectively, with a year-on-year increase of 47.5% and 46.4%, and a market share of 37.7%. In 2023, the production and sales of new energy vehicles reached 9.587 million and 9.495 million respectively, with a year-on-year increase of 35.8% and 37.9%, and a market share of 31.6%. In 2023, the production and sales of new energy continue to rise, and the increase in production and sales of new energy vehicles still provides support for the rare earth market.

After years of governance, the domestic rare earth industry has gradually formed a supply pattern dominated by large groups and relatively concentrated raw materials. With the continuous development of the foreign rare earth industry, China’s share of rare earth production has declined from 90% to 70%. According to statistics, China’s rare earth exports in December were 3438.8 tons; The cumulative total export volume of rare earths from China from January to December was 52306.5 tons, a year-on-year increase of 7.5%. The corresponding increase in export volume supported the prices of some products, but poor domestic demand led to a significant decline in the light rare earth market.

Market forecast: Recently, magnetic material companies have had poor purchasing and ordering sentiment, and there is a lack of new orders from holiday companies. It is expected that the prices of heavy rare earths in the market will mainly fluctuate at low levels in the short term. In the long run, the trend of long-term growth in demand for industrial robots, new energy vehicles, wind turbines and other terminals remains unchanged. High performance neodymium iron boron permanent magnets are expected to continue to increase in terminal penetration rate, which is conducive to the long-term stable development of the rare earth industry.