(Yicai Global) March 3 -- China's Henan Xinye Textile will spend CNY120 million (USD17.22 million) at noon today to build two high-end non-woven production lines for use as raw materials for masks and other medical protection products, it announced at noon today, spurring the company's stock to rise to hit the daily price ceiling immediately after trading resumed in the afternoon.

Xinye's shares [SHE:002087] stopped trading at CNY4.54 USD0.65), up 9.93 percent.

The felt-like fabric is mainly used in the production of high-grade medical and health materials, such as disposable masks, protective clothing, surgical scrubs, smogs and hole towels, sanitary napkins, diapers and other products, according to the announcement.

The company, which will use an existing extra workshop to build the project, expects the construction to take six months. The production line will use polypropylene chips as its main raw material and its anticipated annual output of high-grade spinning fusion composite non-woven fabric will be 25,000 tons, its annual sales revenue will be CNY425 million, and profit will be CNY31.9 million, per the announcement.

The new coronavirus has pushed the production of masks and other medical products sky high in China, inducing a shortage of supply of polypropylene non-woven fabric, a key material to prevent virus penetration in masks and a 10-20 fold increase in its market price, stimulating upstream suppliers to start investing in new production lines. 

State-run chemical giant Sinopec will invest CNY200 million to build 10 meltblown non-woven fabric production lines in Beijing and eastern Jiangsu province, it announced on Feb. 24, with the two production lines in the Chinese capital slated to start partial production in early March and the others to start in succession from April.

The main structure of medical masks consists mainly of three layers of the non-woven plastic fabrics. The inner S layer is an ordinary non-woven fabric, the outer S layer is a waterproof one, and the middle M layer is one that is meltblown and magnetically treated, and is the core layer that intercepts bacteria and droplets.Meltblown material is produced by melting polypropylene granules, with the resulting molten polymer extruded through spinnerets into continuous filaments that are cooled and deposited on to a conveyor belt to form a uniform web. The calendering process uses heat and high pressure applied through rollers to weld the fiber webs together at speed to produce a soft, uniform material, according to the website of face mask raw material maker Fuyang Sensi Trading, which is based in eastern Anhui province

Editor: Ben Armour