The spandex market rose rapidly in June. As of June 30, the price was 75,200 yuan/ton, an increase of 8.36% from the beginning of the month and a year-on-year increase of 138.73%, setting a new high in the past ten years. The current market supply is tight, especially in June, the spandex industry started to maintain a high level near 90%. Although the production capacity remained stable, the inventory level continued to drop to a historical low.
Since the outbreak of the epidemic, consumers around the world spend more time at home, and accordingly, the demand for leisure and sports apparel products has increased. Spandex is an important raw material for weaving all kinds of lightweight and comfortable elastic fabrics. The spandex content of these garments is generally high, which drives an increase in the demand for spandex. In addition, the overall demand for spandex continues to expand, and there is huge room for growth in differentiated industries such as medical and automotive interiors. It is estimated that the demand for spandex will grow at a steady rate of 6%-10% in the future, and the spandex supply will be orderly.
According to statistics, as of 2020, the total effective domestic spandex production capacity will reach 890,000 tons, a year-on-year increase of 4.0%. New production capacity from 2021-2022 will also be concentrated in a few leading companies such as Huafeng Chemical, Hyosung, Xinxiang Chemical Fiber, and Taihe New Materials. In 2020, the domestic spandex output is about 800,000 tons, and the average operating rate is about 90%. In 2020, my country's spandex exports are about 65,000 tons, an increase of 4.3% year-on-year, and the apparent consumption is about 750,000 tons, an increase of 8.3% year-on-year. Spandex exports in the first five months of this year were about 40,500 tons, an increase of 58% over the same period last year.
In addition, the strong increase in raw materials is also an important reason for the price of spandex to go up all the way. Affected by environmental protection this year, the PTMEG industry chain has become very hot. The PTMEG market price is 1800 molecular weight sources and mainstream factories are offering around 38,000 yuan/ton, while the mainstream quotation in the same period last year was 1,4000-15,000 yuan/ton. The mainstream negotiation of pure MDI in East China market is at 19600-20000 yuan/ton wire transfer barrels for self-pickup, and the price in the same period last year was 13600-14200 yuan/ton wire transfer barrels.
Domestic demand plus export sales are both positive and promote the development of the spandex industry. The shortage of spandex's own supply is difficult to improve in the short term, and some factories still have the intention to explore. The performance of superimposed raw material end support is acceptable. Business analysts predict that the spandex market is expected to remain strong in the short term, and the cost end and terminal demand changes will still need to be paid attention to in the later period.