Quarterly Update on Global Non-Woven Fabric Market
For the Quarter Ending June 2021
During the second quarter of 2021, overall market outlook of Non-Woven Fabrics in the North American region showcased mixed results. Presence of upstream Polypropylene (PP) remained ample in the regional domestic market, whereas the availability of the other counterparts such as Polyamides was extremely tight owing to the restricted availability of the feedstocks Adipic Acid and Caprolactam. Offtakes of Non-Woven fabric remained consistent from the textile sector. Due to the constant diversion of feedstocks to the derivatives industries and tight market outlook, prices in the North American region remains in up stride.
Production in China’s Guangdong region was also negatively impacted due to the power outage and rising COVID cases which further led to hindrance in the trading activities at the Guangdong port. In addition, the rising inflation rate in China surged the prices of Propylene. Therefore, market participants were reluctant to procure bulk volumes which extended the wait and see atmosphere in the regional market. As the demand remained sturdy from the downstream textile and healthcare, prices observed a slight increment in India, with ex-Work Ahmedabad discussions for PP Grade in June settling at USD 2314 per tonne.
In European region, Nov-Woven market faced polymer shortage in Q2 2021. Therefore, the supply outlook was tight throughout the second quarter. Several planned and unplanned turnarounds in various Nylon 6 facilities, further pressurized the market fundamentals in the region. Demand was exceptional from the downstream market as the region observed a seasonal hike in demand from the textile sector. Due to the supply demand imbalance, prices remained in uptrend in the quarter ending June 2021.
For the Quarter Ending March 2021
In the first quarter of 2021, the supplies of NWF became affected due to the shortage of the key feedstock polypropylene (PP) as the several US producers were struggling to protect margins for the downstream sectors amid surged demand and limited availability throughout the region. Several manufacturers were forced to shut down the production due to the severe freeze weather conditions in the USA Gulf region. Demand surged amid the material shortage and constant offtakes from the downstream textile, medical and construction sector. Abrupt surge in prices of PP proportionally hiked the prices of NWF in the North American region.
The demand for NWF from the downstream segments declined by 40% as manufacturers cited skyrocketing prices of the key raw materials causing 30% to 50% reduction in capacity utilizations of Non-Woven Fabric plants in India. Tight and expensive Polypropylene caused a big worry to the fabric producers. Added capacities in China supported the inventories but prices remained high amid the global supply shortage of PP and global inflation in rates. Non-woven demand remained high during the first quarter of 2021 with surge in prices reported amid hiked prices of raw materials. NWF FOB Shanghai price settled around USD 2312 per tonne in March.
During Q1 2021, the supplies of NWF remained constrained as a ripple effect of shortages in supply of PP throughout the region, due to the reduced operating rates in producing belts amid limited commercial and economic activities in lockdown restrictions. Berry Global announced the second investment in its wipes segment, which is likely to prop up demand. The new production line is expected to be commercially commissioned in Q3 of 2022. Quarterly demand was high from the downstream healthcare, medical, automotive, and daily use segments.
For the Quarter Ending December 2020
The Asian Non-Woven fabric market remained strongly supported by raised sentiments due to active restocking by the producers of protective clothing, masks and other preventative products. Prices in Southeast Asia surged during the quarter, following the trend of the feedstock Polypropylene (PP) which rose to an eight-month high during the October month. Availability of feedstock remained a key concern as several plant outages were heard in Japan and China during September and October. Chinese players which control the majority of supply directed to the US, stated that due to skyrocketing domestic demand, the export volumes remained tight with many suppliers facing trouble in securing sufficient volumes. Several economies (like India) reported Q-o-Q gains in the export volumes of certain non-woven used in masks and coveralls as their production levels rose in their efforts to ramp up outbound shipments.
The American Non-Woven Fabric market witnessed strong Q-o-Q growth due to tight product availability from several Asian economies especially China. The regional buying interest remained upbeat due to strong demand for disinfectant wipes, face masks, disposable gowns and other personal protective equipment (PPE) amid surging COVID-19 cases. Upstream PP supply tightness and ease in lockdown restrictions kept the pricing range well above expectations. The hurricane-related plant disruptions heard in Q3 were resolved by Q4 along with the news of start-up of Braskem’s new plant which considerably eased the PP supply shortage. The demand for Non-Woven Fabric increased by 30-40% in the US since the start of the pandemic, a regional trader remarked.
Moving into the fourth quarter, the price of Non-Woven Fabric in the European market continued to feel the impact of supply shortage and by the end of the year prices had touched fresh hikes due to global surge in feedstock PP prices and rising container freight shortage. In October, EU remained the largest Non-Woven export market, registering an increase of about 18.9% over October 2019. Moreover, several German buyers were heard closing their January orders in advance looking at the exponential surge in COVID-19 cases. Regional producers continued to face the heat of surging feedstock PP triggering a spike in non-woven and fiber grades, which seemed to continue in the near-term.