US Non-Woven Fabric Situation: Bearish Conditions Continue Amid Limited Spots Activity

During the first half of June 2023, the Non-Woven Fabric market in the United States struggled to gain momentum as global demand slowed, likely increasing concerns that economies might enter a recession. Demand for Non-Woven Fabric from the US market continued to be somewhat middling during the third week, continuing a trend that began earlier at the start of the month. Market sources concur that a clogged pipeline from source to retail is the primary cause of the slowdown.

A Purchasing Managers' Index (PMIs) for May 2023 showed new orders falling in the manufacturing powerhouses amid muted demand. According to the Institute for Supply Management (ISM), the Business Activity Index recorded 51.5, which is down 0.5% points from 52 in April 2023.

However, in the US market, retail shelves are full, and Non-Woven Fabrics mills have ample fabric inventory to meet their immediate needs. There is also some fear about where the economy is headed over the next few months. Regarding demand, purchasing intentions are down overall from recent levels as the downstream textile sector appeared to be covered with huge inventories. At this point, demand for Non-Woven Fabric has been affected to a significant level. Inquiries for Non-Woven Fabric remain low from textile industries such as sanitary protective clothing. As a result, spinners were considering lowering their operating rate due to the high availability of the warehouse material.

In the upstream market, the price of feedstock Polypropylene shivers at a low level this week, dampened by the commodity atmosphere. Participants in the Non-Woven Fabric market were also pessimistic about a possible change in the fundamentals, pointing to the expectation of low demand in the coming weeks. This, in turn, supported them to lower the operating rates as they were already struggling with the overstocked material.

In contrast, as a major exporter of Non-Woven Fabric, China experienced a considerable decrease in overall exports during this period. Export opportunities were limited because demand for imports was low in the United States, and prices in Asia continued to fall amid increasing supply, closing the window for arbitrage.

As per the ChemAnalyst forecast, the price for Non-Woven Fabric may follow the same trend in the upcoming months, with prices on a downtrend. The declining feedstock cost may further contribute to the declining prices. However, fluctuations in the crude oil market must be considered while concluding the final week's final prices for Non-Woven Fabric.