In mid-December, power and production restrictions began to occur in Zhejiang, and then in Shaoxing, the printing and dyeing industry suspended production for three days from the 27th to the 29th due to environmental issues. I thought the shutdown was about to end, but something unexpected happened halfway: Shaoxing launched a steam turbine shutdown plan from December 29th to January 5th, involving 57 printing and dyeing companies.
After the news came out, the market exploded again. I originally thought it was just The three-day production suspension was extended again, catching Boss Bu by surprise. Suspension of production for 3 days will not have much impact on the generally relatively loose order delivery time this year, but if it is extended for another 6 days, the impact will be amplified and order delivery may be overtime. Although the production restrictions and suspensions are limited to the Zhejiang region, they will have a direct impact on cloth owners who originally dyed in Zhejiang, and will also have an impact on dyeing factories in surrounding areas. Zhejiang dyeing factories have limited or suspended production, causing some orders to be transferred to Jiangsu. Therefore, dyeing factories in Jiangsu, especially in Shengze, have seen hot prices again recently. The sudden queue and jam extended the original 7-day delivery order to more than 10 days, which disrupted the cloth boss’s production plan or affected the shipping time.
A salesman from a trading company said: “I have an order in hand and it is produced at the dyeing factory in Shaoxing. I was originally notified that the dyeing factory will stop for three days, and The customer said hello, and the delivery date was relatively loose, so he said it didn’t matter. But now he said it would be suspended for 6 days. Although it was a rotating shutdown, it would still be affected, and the delivery date would definitely be postponed. This batch of goods itself is It has become very troublesome for customers to rush for goods at the end of the year.”
Recently, the downstream gray fabric market has been booming, orders have increased, and there has been a wave of orders. However, in addition to the “production restriction order” of dyeing factories, there are also many disturbances, which have added a lot of resistance to the placing of orders, production, and delivery.
01 Pfizer vaccine accident, the risk of foreign trade orders increases
On the 28th, a A 75-year-old man from Beit She’an, Israel, died 2 hours after receiving the Pfizer vaccine. Israel’s Health Ministry said preliminary examinations did not show a link between the unfortunate incident and the vaccination. But no matter what, this matter still caused some panic and there are still doubts about the vaccine. At the same time, the United Kingdom, South Africa, and Nigeria have successively reported the discovery of mutated new coronaviruses since December. As of the early morning of the 27th, Beijing time, the cumulative number of confirmed cases of COVID-19 worldwide exceeded 80 million, and the cumulative number of deaths exceeded 1.75 million.
Recently, the epidemic situation abroad has been severely counterattacked, and the confidence of the textile market, which has just recovered, may decline again, resulting in the measures originally issued before the Spring Festival. There is a risk that the order quantity will be reduced or canceled directly. In particular, foreign trade orders have been directly affected. An owner of a foreign trade company said: “I have just received a few orders with quantities of tens of thousands of meters. However, the recent outbreak of the epidemic really made me doubtful. I hesitated when taking the order, but in order to survive, I still gritted my teeth. Accepted.”
02 Ocean freight has reached a new high, and shipping has become the biggest problem
Shipping has also been affected, especially foreign trade orders, due to container tightness and high shipping costs. Impact, shipping has become the biggest problem! Recently, European sea freight has once again set a new sky-high price. It is reported that the European and British quotation in January has reached 13,500 US dollars. On December 11, the freight rate (shipping and shipping surcharges) exported from Shanghai to the European basic port market was US$2,948/TEU, an increase of 24.2% from the previous period. January may be the last delivery time for foreign trade orders before the Spring Festival, but the freight rate has increased by 24.2%, which will directly affect the cloth boss’s profits, and may even cause serious losses. But for an order that has been completed, it will be a loss if it is not delivered, and it will be a loss if it is delivered. Boss Bu is so worried that he can’t sleep.
Funds are tight at the end of 2003, and the lower exchange rate increases foreign exchange settlement worries
Receivables cannot be collected Shun also brings a lot of trouble to Boss Bu. As the end of the year approaches, nothing is more important than getting paid. Recently, dyeing factories and other manufacturers have begun to take delivery of goods, and then at the end of the year, workers’ wages and year-end bonuses require a lot of cash. However, domestic sales often have a long period of arrears, ranging from 3 to 6 months. Even if remittances are stable for export sales, Mr. Bu dare not settle the foreign exchange even if he has money in his account due to the recent appreciation of the RMB.
Many foreign trade cloth bosses are still waiting and watching. The financial pressure is increasing, but they still insist on not settling foreign exchange, not wanting to cause losses due to the exchange rate difference. This is a hard-earned meager profit. Manager Zhang, a foreign trade person, said that it is a headache to settle foreign exchange now. It feels like the longer you wait, the lower the price will be. But now, I am really reluctant to settle. The price difference is huge, so I don’t want to settle.�The gold chain can’t hold on any longer! As far as the current situation is concerned before the Spring Festival holiday, the dyeing time in the dyeing factory has been extended, the production is crowded, and the production needs to be rushed in advance. Therefore, the textile workers should put the orders in hand on the schedule. At the same time, the risk of Mr. Bu taking orders has increased, especially for export orders, and he needs to beware of cancellations. In addition, we still need to pay attention to overseas epidemics, especially in Europe. There has been news of Germany and the United Kingdom closing their cities, which will have a great negative impact on the market. The spring and summer orders of downstream fabric manufacturers are likely to be canceled again. Companies need to do Good risk control!
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