• Key YTD moves: Cotton +15%; Polyester +17%; HW DWP +38%; China-origin DWP +28%; medium-grade VSF +10% and high-end VSF +13%. In contrast, Lyocell is down 7%.
  • VSF price down 1% w/w: The VSF operating rate was flat at 78% and inventory days increased slightly this week to 30. The VSF/DWP spread declined w/w and is now down 7% YTD. The theoretical VSF loss for Chinese producers widened further to -RMB 1,053/t. Further maintenance is likely as energy consumption is currently being reduced.  
  • DWP prices stalemate: Domestic producers seemed keen to raise prices, but this was offset with limited new business from VSF producers. DWP/pulp spread remains high at c.USD 385/t. Hunan Juntai and Sun Paper are both producing DWP. With VSF plants considering maintenance due to inventory build and limited new procurement, pressure on hardwood DWP prices seems more likely.

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