**Business News Agency – September 3**
Recently, after several sharp price increases, viscose staple fiber has finally reached a high-end level, with strong market demand and good sales momentum. Companies are gradually reducing their inventories, and some have even experienced supply shortages. New cottonseed is beginning to hit the market, but the situation remains complex.
**First, high costs are causing losses in viscose staple fiber production**
The domestic cottonseed market remains unstable. Currently, only a small amount of seed cotton is being picked in Hebei, Shanxi, Hubei, Anhui, and Xinjiang. Although some cotton companies have started to acquire new seed cotton, the limited supply and delayed listing mean that most of the new cottonseed will not be available until mid-September. At present, the ex-factory price of Hebei Mao 20 moisture new seed cotton is 1.40 yuan/kg, while Shandong Xiajin 12 moisture gross seed is priced at 1.52 yuan/kg. In Hubei Xiangfan and Hunan, the price is around 1.35 yuan/kg. With decreasing cotton production, cottonseed prices continue to rise steadily.
Cotton linters are also becoming scarce, with local prices increasing. Due to the delay in the listing of new cotton, new linters have not yet entered the market, leading to a tight procurement environment. Some manufacturers are waiting for opportunities to raise prices. The factory price of Xiajin quality cotton linters is 9,000 yuan/ton, while the mainstream price for blended cotton linters is between 8,300–8,500 yuan/ton. Cashmere blends are priced at 7,600–7,800 yuan/ton. In Xinjiang, second-grade velvet is priced at 7,000 yuan/ton, and mixed road velvet is as low as 6,700 yuan/ton. Prices are still rising, but downstream companies like cotton pulp and viscose producers are not eager to buy, so the actual shipment volume in the short fiber market is not very visible. However, the reduced cotton production has brought significant benefits to the short fiber market, with quotations reaching record highs.
Currently, the market price for blended cotton linters is around 7,600 yuan/ton. Assuming a 30% loss, the raw material cost for short-grain cotton pulp is approximately 9,880 yuan/ton. Adding a processing fee of 3,000 yuan/ton, the total cost for short silk cotton pulp is about 12,880 yuan/ton. However, the current market quotation is only around 13,000 yuan/ton, leaving a profit margin of less than 200 yuan. This has put pressure on cotton pulp companies.
Meanwhile, after several price hikes, the current high-end offer for 1.5D viscose staple fiber is 18,100–18,300 yuan/ton, while mid-range products are quoted at 17,700–17,900 yuan/ton. Based on a cotton pulp price of 13,000 yuan/ton, the raw material cost for viscose staple fiber is 14,820 yuan/ton. Adding a processing cost of 6,000 yuan/ton, the total cost reaches 20,820 yuan/ton, resulting in a loss of over 2,500 yuan per ton.
**Second, viscose staple fiber and cotton prices are similar, while polyester staple fiber is also climbing**
In general, textile companies determine their cotton ratio based on order production. While there is little flexibility, some companies adjust the proportion of viscose staple fiber and cotton according to their own needs, aiming to produce high-profit, low-risk yarns. According to statistics, the price difference between viscose staple fiber and cotton is usually between 3,000–4,000 yuan. Currently, the price gap is much lower than usual, making viscose staple fiber more cost-effective for yarn companies focused on efficiency and profit. Additionally, with crude oil prices bottoming out and PTA prices rising steadily, the macroeconomic outlook remains positive, pushing polyester staple fiber prices up to 9,650–9,750 yuan/ton. As polyester staple fiber is also used in cotton spinning, its price increase has further supported the rise in viscose staple fiber prices.
**Third, cotton yarn margins remain strong, and short fibers continue to rise**
Overall, the cotton yarn market is showing strong performance, with monthly price increases of 300–500 yuan. For example, 30S cotton knitting yarn has risen to 25,300 yuan/ton, and 40S cotton knitted yarn is now offered at 26,800 yuan/ton. Calculating from the contractor’s perspective, the price of viscose staple fiber is around 18,000 yuan/ton. Assuming a spinning loss of 1.02, the raw material cost for 30S human cotton yarn is 18,360 yuan/ton, plus an average processing cost of 4,000 yuan/ton, bringing the total cost to 22,360 yuan/ton. Meanwhile, the market quotation for 30S cotton knitting yarn in Jiangsu and Zhejiang is 25,300 yuan/ton, and woven yarn is at 23,500 yuan/ton, offering a profit margin of 1,000–3,000 yuan/ton. Even if viscose staple fiber prices go up, downstream yarn companies can still afford it, which supports the continued price rise of viscose staple fiber.
**Fourth, the September season is upon us, and viscose staple fiber is in short supply**
Currently, the market is experiencing a shortage of viscose staple fiber. After a few price increases, market sentiment has improved. Companies such as Shandong Helon and Tangshan San You have sold out their backlogs, and many are reluctant to sell at current levels. With the arrival of the peak season in September, the cotton yarn market is expected to open up. Sales of fabrics for Han cloth and autumn/winter clothing will also drive demand for viscose staple fiber. All viscose staple fiber enterprises are operating at full capacity, and the seasonal demand boost has given them confidence. According to insiders, a meeting scheduled for the 10th of this month will also discuss potential price increases.
In summary, viscose staple fiber companies are showing strong production and sales momentum. After inventory issues are resolved, they have gained more confidence. While the impact of reduced cotton production has benefited cotton linters, the high prices of cotton pulp companies have remained stable. Although the price of viscose staple fiber has risen from 16,500 to 18,000 yuan, companies are still able to maintain operations. It is expected that the cost factors will continue to push prices higher in the coming period.
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