Market Morsel: Fibres – natural vs unnatural.
Market Morsel
No man is an island entire of itself; every man is a piece of the continent, a part of the main. The same can be said of fibres. No fibre is an island; they are part of the whole.
On a regular basis, we compare the fibres, as it provides a quick outlook on the market structure across the major fibre types. Our last update was in late August (see here)
The chart below shows the following fibre types as an index, with 2015 being 100. The index’s value is that it allows the reader to quickly determine the rate of growth easily with pricing at different levels of magnitude.
- Zhengzhou cotton futures
- ICE cotton futures
- Chinese polyester & acrylic
- Eastern market indicator (wool)
Generally, the fibres follow one another quite closely due to their end-use being similar. This is a similar pattern show between many other commodities, such as wheat and corn.
Between July and August, wool lost a whopping 7%; during September, the average price has remained flat. In August, cotton had gained a solid 5%; in September, a further 2% was added.
The second chart shows the monthly change in price between cotton and wool. Throughout this year, cotton has shown a stronger performance than wool.
