US Viscose Staple Fiber Market Sentiment Shrinks to Its Lowest in June 2023
- 13-Jul-2023 12:30 PM
- Journalist: Nicholas Seifield
The Viscose Staple Fiber (VSF) in the US market has been experiencing a slowdown in its orders, leading to the contraction in its Purchasing Managers Index (PMI) during June 2023. The manufacturing activity in the US contracted for a continuous eighth month till June 2023, sliding to the lowest stage in more than 3 years as employment and production cost pulled back. The June value for VSF 1.2D was found at USD 2280/MT CFR Texas, as per the ChemAnalyst database record.
The Federal Reserve Bank of St. Louis (FRED) released data showing an increase in the Consumer Price Index (CPI) for May 2023. The index rose to 131.195, up from 130.811 in April 2023. The decline in the FRED producer price index, which also fell to the lowest level, suggests that manufacturing activity in the region declined to 246.171 in May 2023 from 248.712 in April 2023. Also, the decline in new orders for VSF from the textile sector supported the pullback in manufacturing activity in the domestic market.
However, considering the still-high inflation in the US, many North Americans are limiting their purchases. During June 2023, eleven industries experienced a fall in manufacturing, including the textile market and wood products such as VSF. In the meantime, there was an anticipation that the demand for VSF may improve from the second half of 2023, but this does not seem to be the case, as there was lackluster demand from the end-use industries such as apparel, home textiles, dress materials, knitwears, and non-woven sectors.
According to data from China's General Administration of Customs, China's total exports of textiles, clothing, and accessories in the first four months of 2023 were USD 92.883 billion. This decreased by 2.87% compared to the same period last year. Conversely, China's exports of textiles, such as yarn and fabric, fell 8% year-on-year (YoY) in the first four months of 2023 to USD 44.808 billion from USD 48.717 billion in January-April 2022.
As per the forecast suggested by ChemAnalyst, the price for VSF 1.2D is expected to remain on the lower side, as the macroeconomic conditions in the US market are likely to weigh on the consumers spending. Also, the weakening end-use demand from the textile and apparel industries is expected to keep the market for VSF underneath. However, a lackluster forecast for the Hurricane season may further disrupt the market sentiments amidst still low demand for VSF.