• Key YTD moves: Cotton +18%; Polyester +20%; HW DWP +38%; China-origin DWP +27%; medium-grade VSF +15% and high-end VSF +16%. In contrast, Lyocell is down 5%.
  • VSF price slightly lower this week: The VSF operating rate improved to 79% as units in Southeast China came back from maintenance. VSF inventory days increased slightly this week to 23 as spinners took delivery normally. The VSF/DWP spread declined w/w and is now down 1% YTD. The theoretical VSF loss for Chinese producers is still in the red at -RMB 316/t as production costs increased further (caustic soda and sulphuric acid).   
  • Softwood DWP price up w/w and China-origin DWP marks first price increase since 7 May: With the DWP/pulp spread at c.USD 320/t, this is likely to encourage further DWP price stability, while local producers favour DWP production. Hunan Juntai and Sun Paper are both producing DWP, while Chenming Huanggang intends to produce DWP.  Hardwood DWP continues to trade around USD 1,010/t, while softwood DWP is benefitting from tight supply.

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