Disperse Black 300% has climbed to nearly 30,000 yuan per ton after the August 8 price adjustment, just weeks after two rounds of hikes in July. Despite weak off-season demand, dye prices are surging, driven by a near-tripling in core intermediate costs. For dyeing mills, this is not a cyclical fluctuation but a structural reset of cost bases.
Raw Material Squeeze: Reductive Agent and H-Acid
The reductive agent (2-amino-4-acetamidoanisole) is indispensable for producing black, blue, and violet disperse dyes. Public data shows its price rose from 25,000 yuan per ton at the end of 2025 to 70,000-100,000 yuan per ton by March 2026, an increase of nearly 300%, and has stabilized above 100,000 yuan per ton since mid-year. This means dye manufacturers would see profits eroded if they kept prices unchanged, making hikes inevitable.
Supply rigidity is the root cause. Domestic compliant reductive agent capacity is only 50,000-60,000 tons, highly concentrated among three players: Zhejiang Longsheng, Runtu, and Ningxia Zhongsheng New Technology. Expansion potential is minimal, supply elasticity is weak, and any small demand uptick can push prices higher. Meanwhile, H-acid, a key intermediate for reactive dyes, faces similar pressure. Its production involves sulfonation and nitration processes with high pollution, and under environmental regulation, outdated capacity has been phased out. Current effective capacity is below 60,000 tons, with a supply gap of over 10% year-round. The simultaneous rise of both raw materials creates a dual cost squeeze, reducing resistance to dye price increases.
Dyeing Mills' Dilemma: 60% Operating Rate, Weakened Pricing Power
Cost pressure is directly transmitted to dyeing mills, but their position is passive. In the traditional off-season, the average operating rate across the country is only about 60%, with few bulk orders and mostly sampling or small trial orders. Revenue is limited, and soaring dye costs are compressing profit margins.
A deeper shift is underway in the industry's supply-demand logic. In past peak seasons, mills leveraged capacity to command pricing power, charging rush fees and fabric premiums. Now, conventional fabrics are increasingly commoditized, small orders are consolidated, and orders are concentrating among major clients. Most mills have homogeneous processes and lack differentiation, turning the market into a buyer's market where mills cannot easily raise processing fees. Only a few high-end mills with stable quality control can independently increase fees, relying on premium client relationships.
Some mills have issued fee hike notices to offset costs, but weak off-season demand and low acceptance among major clients hinder cost pass-through. Most small and medium mills must absorb the difference, making sustained losses unsustainable.
Peak Season Transmission: Costs Will Fully Release
In the short term, downstream fabric and garment companies have limited orders and have not yet felt the pinch of higher dyeing fees, as mills prioritize retaining core clients. But this low-price, high-cost model cannot last. In September-October, the traditional stocking season will bring concentrated orders from garment and foreign trade sectors, and the accumulated cost pressure will cascade down the chain. Fee increases will become widespread, raising costs across the entire textile supply chain, ultimately borne by fabric mills, brands, and consumers.
For buyers, this round of hikes means the window for locking in low prices is closing. It is advisable to monitor dye price trends, negotiate medium-term processing agreements with mills before the peak season, and optimize fabric structures to reduce reliance on high-dye-consuming categories. For foreign trade companies, shortening quotation cycles and including dye price linkage clauses in contracts are essential to protect margins. Partnering with mills that have strong quality control and pricing power can also mitigate delivery and quality risks.