Following the “Hand Chopping Festival” Double Eleven, another “Double Twelve” is ushered in. I wonder if the orders in the hands of textile colleagues have increased? According to the editor of Shashidi (WeChat ID: ssdtex), the current textile market is still quite sluggish, and the surge in raw materials has put great pressure on the industry! Textile people are currently facing a “chaotic” market. The end of the year should be a happy period, but this year’s textile people really can’t afford to be hurt!
Costs are rising, making it increasingly difficult for textile companies to survive!
Due to confusion in cotton quotations, the overall cost has been significantly increased. At present, there are four main channels for textile companies to use cotton.
First, the price of state-owned cotton is expected to rise. As of December 11, the vast majority of textile companies in Jiangsu and Zhejiang have used up their state cotton reserves, leaving only a few large textile companies and traders with a small amount of state cotton reserves “waiting for sale”. According to the person in charge of a 400,000-spindle spinning enterprise, the state-owned cotton reserves auctioned by their factory from March to September this year can last until the end of January 2017. Including warehousing and interest, the current cost of their factory’s 3128-level state-owned Xinjiang cotton is About 14,600 yuan/ton.
Second, Xinjiang cotton prices continue to rise. December is the peak period for Xinjiang cotton to be moved to the inland. According to a cotton dealer, the price of Xinjiang hand-picked cotton “Double 29” and “Double 30” that has been moved to Jiangsu and Zhejiang is 16,300-16,600 yuan/ton, and some of the particularly high-quality ones can reach 17,000 yuan/ton (factory price, including Tax). The price of grade 3128 machine-picked cotton is in the range of 15,900-16,100 yuan/ton, a slight increase from last week.
Third, the price of real estate cotton is rising. Real estate cotton includes real estate large bales of cotton and small bales of cotton. On December 11, the price of large bales of 3128-grade cotton in Jiangsu and Zhejiang areas was 15,400-15,500 yuan/ton, and some were 15,600 yuan/ton and above. The price of grade 3 small bales of cotton is 15,200 yuan/ton, while the price of grade 4 is 14,300-14,500 yuan/ton.
Fourth, imported cotton is selling well and prices are expected to rise. According to feedback from traders, U.S. cotton is selling well this year. As of late November, U.S. Cotton has signed contracts for 1.645 million tons of cotton this year and shipped 625,000 tons. Among them, China has signed contracts to import 225,000 tons of US cotton and shipped 73,000 tons, an increase of 341% and 115% respectively compared with the same period last year. It is expected that US cotton will gradually arrive in Hong Kong in mid-to-late December. According to the conversion, the current price difference between domestic and foreign cotton (converted into 1% tariff) is 2,500-3,000 yuan/ton.
According to feedback from textile enterprises, although the sources of cotton are different, the prices have increased correspondingly. For pure cotton textile companies, cost pressure is increasing day by day.
Small factories have reduced production and increased production, and it is a bit difficult for cotton yarn to rise!
According to the survey, since mid-December, the gross weight sales quotations of “3128” large bales of cotton and small bales of cotton in the cotton areas of southern Hebei and western and southern Shandong have been 15,500-15,800 yuan/ton and 14,900-15,300 yuan/ton respectively. Due to differences in cotton grade quality It is relatively large, and the price difference between manufacturers is also large.
Textile enterprises in Cangzhou, Hengshui and other places in Hebei Province said that the length, horse value and other indicators of cotton in the Yellow River Basin in 2016/17 were slightly better than last year, but the breaking ratio strength was insufficient. Among them, the “3128/3129” grade lint cotton can be spun 40S and below. Count cotton yarn. At present, the quotations of Xinjiang’s “Double 28/Double 29” new cotton in mainland China’s underground warehouses are generally 16,300-16,500 yuan/ton, which is not only significantly higher than that of real estate cotton, but also has insufficient supply (some cotton companies in Xinjiang adopt bundled sales). The prices of imported Australian cotton and American cotton are also high. Therefore, some small and medium-sized manufacturers spinning cotton yarn below 40S use “real estate cotton + reserve cotton” or 100% real estate cotton. Some yarn mills consider selling goods before the festival, recycling funds and cotton share. Measures such as production cuts and early holidays have been adopted to address risks such as pressure on liquidity.
Recently, driven by the continued rise in domestic cotton spot prices, rising transportation costs of cotton and cotton yarn, and high processing costs, the quotations of carded yarn in Henan, Hebei, Jiangsu and Zhejiang and other places have increased by 100-200 yuan/ton, while combed yarn and high-end yarn prices have increased by 100-200 yuan/ton. Yarn reports have increased by 300-400 yuan/ton (Xinjiang fine-staple cotton and long-staple cotton account for a high proportion of cotton), but downstream weaving factories, fabric factories and garment factories do not recognize it, and the actual transaction has only increased by 50-100 yuan/ton. .
Some cotton mills reported that it was very difficult to negotiate price increases with weaving mills and middlemen, and some customers directly proposed to postpone delivery of goods or cancel the contract. On the one hand, Jiangsu, Zhejiang, Fujian, Shandong and other places have stepped up environmental protection since November. Many printing and dyeing factories have been shut down and production has been reduced. Dying factories that are producing normally have to work overtime due to overly full orders. Coupled with the addition of dyes Prices have risen sharply, so dyeing fees have also increased significantly. Cloth mills’ profits have been swallowed up and losses are common. On the other hand, as the end of the year approaches, downstream spinners, cloth mills, fabric mills and garment factories are eager to collect credit and arrears in order to sell goods and The main focus is to clear inventory, and considering that the cotton reserve will be launched on March 6, 2017, cloth mills and cotton yarn traders have no plans to stock up before the year.
In recent years, under the alternating influence of unfavorable factors such as RMB appreciation, rising labor costs, rising raw material prices, and turbulent international environment, the textile industry has entered a “…In the era of “profit”. Especially in the context of global economic integration, neighboring Southeast Asia, South Asia and other regions have seized the international market that originally belonged to Chinese textile companies with lower costs. Under the “domestic and foreign troubles”, the situation has always been China’s textile industry, which dominates the world with its “cost advantage”, is facing unprecedented challenges! When costs continue to rise and the “cost advantage” disappears, where will we go?
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