RISI VIEWPOINT: Volatility in raw material pricing driving swings in nonwovens roll goods prices




BEDFORD, MA, August 17, 2017-

By Rod Young, Chief Economic Advisor, RISI

The nonwovens industry relies on major raw materials that tend to be associated with quite a bit of price volatility. The two most important, polyester and polypropylene, have prices that are closely tied to oil prices through precursors that are largely derived from fossil fuels. No one has to be told that this relationship will lead to a substantial amount of price volatility. The third most important staple fiber, viscose, also exhibits frequent swings although not due to any ties to fossil fuel. Instead, the instability results largely from shifts in demand/supply balances, changes in viscose pulp prices and competitive positioning versus cotton. A fourth staple fiber used by the nonwovens industry, cotton, is also associated with wide gyrations based mainly on supply-side issues such as crop selection and weather conditions, which can cause dramatic fluctuations in global inventories.


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