Inventory is the most difficult problem to solve and the most troublesome problem for bosses in the textile and garment industry this year. When the editor talked to many textile owners about whether they had made money, most of the answers were: they made a lot of inventory!
Don’t let inventory become the “straw that breaks your company’s back”! Be the voice of the weaving boss these 2 months! Therefore, entering November, the market operating rate in Jiangsu and Zhejiang has declined compared with the same period in previous years. Manufacturers continue to slow down the rapidly growing gray fabric inventory by adjusting production loads and eliminating backward production capacity…
A textile company recently issued a statement News: The company’s gray fabric inventory has dropped sharply, most specifications are out of stock, raw materials have increased significantly, and the price discount will be reduced in the future…
With the sudden As the incident continues to unfold, the prices of bulk textile raw materials have increased, stimulating downstream traders to purchase goods. Some manufacturers are doing well in destocking, and they seem to have “confidence” for price increases next year!
At the end of the year, raw materials are “red”, and gray fabric manufacturers take advantage of the situation to “raise prices”!
As the east wind blows, the US-Iran issue may become an excellent weapon for those in the polyester industry to get rid of oversupply and low levels. Many industry insiders have analyzed that this incident is the “starting point” of the vortex in the Middle East in 2020, and the momentum of periodic fluctuations in crude oil may not “extinguish” in the short term. The chemical fiber industry has a very close relationship with crude oil, and related chemical raw materials have performed strongly recently.
In addition to the polyester industry, nylon prices have also been rising recently. For example, the negotiated price of the mainstream conventional semi-gloss FDY70D/24F of nylon FDY is 15,000-15,500 yuan/ton, and the negotiated price of POY85D/24F is 13,800-14,400 yuan/ton; the execution price of conventional large-texture DTY70D/24F is 16,500-17,500 yuan/ton, both It has increased compared with the previous period.
The prices of raw materials have been rising frequently recently, making textile bosses who have been hovering at the profit and loss line “exacerbated”. In particular, nylon products have experienced a large increase in the past two months, and some nylon fabric manufacturers have raised their quotations as early as the beginning of the month. “Recently, the quotation of nylon yarn has increased slightly, but only by a few cents. The sales of nylon yarn have not been good this year. We are transforming into regenerated nylon.” A nylon manufacturer in Wujiang area said.
The gray fabric fell below the “underpants”, and there is no room for price concessions!
In the past, weaving companies were not as sensitive to rising raw material prices as they are now. Under normal circumstances, the cumulative increase in raw material prices reaches a thousand yuan/ton before the price of gray fabrics increases by 0.10 yuan/meter. So why do textile bosses want to adjust prices when raw materials have only increased by a few hundred yuan recently?
It’s simple, the price has fallen below the bottom and there is no way to fall!
In 2019, the entire weaving market has been plagued by overcapacity and imbalance of supply and demand. Manufacturers lack bargaining power and prices have been falling. Many textile bosses even sell at a loss in order to reduce inventory. As a result, the price of the entire market has been chaotic, falling all the way to the lowest price in recent years:
For example, 190T polyester taffeta fell from 1.80 yuan to 1 yuan;
75D 24T chiffon dropped from 3.3 yuan Dropped to 2.6 yuan;
75D weft twist imitation memory dropped from 2.8 yuan to 2.3 yuan;
……
According to rough estimates, the price of gray fabrics has dropped by as much as 25-45% this year. “The market prices are relatively chaotic this year. Our pongee prices have been kept very low by customers, and we can only place one order. Some products are at a loss, while others are slightly profitable, and we operate at a minimum,” said Mr. Chen from the Wujiang area.
As for the price increase of raw materials before the holidays, Mr. Chen also said that it was “mixed”. “Raw materials tend to go up before the holidays every year, and it’s not unusual for them to go up this year. However, our profits on gray fabrics are already very low now. If they continue to rise after the year, we will also raise the price.”
In the near future, no The boss of Shao Textile said that he will not raise the quotation for the time being. On the one hand, the order taking has come to an end, and the current quotation increase has no substantial effect. On the other hand, the inventory in the factory has not been exhausted after all, and the increase in gray fabric prices is still insufficient. power. “Although price increases still need to be driven by raw materials, there is not much room for prices to fall further.” said Mr. Yang, another imitation silk manufacturer.
Many market participants said that the past 2019 was just the pain of digesting products with overcapacity. Although the pain is still there, the pain may ease with 2020. After all, there is a big ” “Black Swan” is changing for the better – China and the United States will sign the first phase of the economic and trade agreement next week!
China’s textile and garment industry has always stimulated the foreign trade export-oriented economy with low-cost labor, and also created a golden period in previous years. Since the start of the Sino-US trade war, European and American customers have greatly reduced their purchase orders, and some have even canceled orders, and some have even canceled orders. With a year of “love and hate”, most textile workers��New outlets have been opened for orders in 2020.
In addition, Sino-US relations are still releasing positive signals recently: China and the United States will sign the first phase of the economic and trade agreement next week, and the United States will implement the phased elimination of additional tariffs on Chinese products. For textile foreign trade bosses in 2020, although the “wolf is coming” story has been heard too many times, it is at least a good start.
In addition, gray fabric manufacturers have larger inventories this year. Another major factor is the large inventory in the downstream garment industry. Due to the expectation of a cold winter the year before last, most clothing companies have stocked up on a lot of cold-proof clothing. In addition, this year’s warm winter has led to further slow sales of down jackets and cotton clothing. The clothing industry is afraid to stock upstream, which has also caused a supply and demand for gray fabrics. imbalance.
As we enter 2020, a new season of spring and summer clothing is also being prepared. Unlike down jackets, spring and summer fashion has relatively high requirements for style, so it needs to be re-printed and purchased. Therefore, the rigid demand for fabrics still exists. “Currently, we have received orders for April, all of which are imitation silk fabrics. There is not much inventory in the factory recently, and we are busy rushing to make weaving products. Imitation silk may increase a little bit in the beginning of next year.” A company in Shengze area owns Shanghai Said the textile boss of Baitai Loom.
According to convention, after the Spring Festival in previous years, the trading atmosphere in the market will gradually recover, and domestic demand and foreign trade orders will be further released. However, there are too many uncertainties in the market this year. The boundaries have been blurred, but what is certain is that although it is difficult for the raw material market to rise sharply, it is also difficult to fall sharply. Driven by the combination of demand and cost, low-priced fabrics may become a thing of the past! </p
