How seasonal demand can uplift the Viscose Staple Fibre market

Viscose Staple Fibre (VSF) prices saw a marginal increment in the first quarter of 2022 across the Asia Pacific region. In March, the feedstock wood pulp prices also gained momentum after showing tremendous volatility. As of last few months, the downstream textile industries have been enthusiastic in both production and supply chain. Thus, the price for VSF is assessed at USD 2336 FOB Shanghai (China) & CFR 2321 Texas (USA) in April.

Further, with seasonal changes arising, the demand for VSF from downstream textile industries geared up along with limited material availability as raw material prices climbed strongly. At the same time, operating rates for VSF remained sluggish in the Chinese market, which kept upward pressure on the available material. Inline, China being the exporter of VSF to its neighbouring countries, has been hampered due to the current lockdown in some of East Asia, thus lifting the trend higher with demand on its pick.

Grasim Industries, a leading manufacturer of VSF, had announced in Q4 of 2021 that the company would be operating at optimum capacity in hopes of a significant revival in its seasonal demand. As a result of the market revival, the price of Viscose Staple Fibre in India has increased by 10 rupees per kg from previous rates, resulting in a price of INR 170200 ex-Mumbai as of March 25th. In addition, the company also reported a 26 percent increase in net profit to USD 229765564.44 in Q3 FY22 over Q3 FY21.

On the other hand, Aditya Birla Group, a leading producer of viscose staple fiber, has also increased the price for VSF by 6% from previous rates due to the rise in prices of cotton, polyester, and acrylic staple fiber.

Thus, as per ChemAnalyst analysis, “the demand for Viscose staple fiber is anticipated to boost with higher demands from textile and apparel industries amidst seasonal change. Thus, Viscose staple fiber may witness an upward price trend in the forthcoming weeks.”