Following the opening of the China Textile City on February 18, today (February 21), known as “China’s No. 1 Cloth Market” China Oriental Silk Market officially opens.
On the other hand, as the epidemic continues, more than 6 million tons of polyester production capacity will be reduced or stopped after the holiday. So far, the total polyester production has dropped to a low of around 65%, which is far lower than the same period in previous years.
The two largest textile markets in Jiangsu and Zhejiang are opening one after another. Will it bring changes to the weak polyester raw material market?
Polyester filament: not falling? Because no one buys it!
If you use one word to describe the current polyester filament, it is ” There is a price but no market.”
Affected by the epidemic, the resumption of work of textile companies after the holiday is generally delayed. For weaving enterprises, it will certainly affect production capacity, but under the premise that conventional gray fabric production capacity is overcapacity in 2019 and a large amount of inventory has not been digested, although delaying the start of production will cause some losses, it is not completely unacceptable.
But for polyester companies, the situation is much worse. As of February 13, polyester filament POY inventory has risen to about 24 days, and FDY inventory has risen to about 26 days. , DTY inventory rose to about 30 days.
Compared to weaving companies, high inventory brings simple high pressure to polyester factories.
Although the price of polyester filament has not fluctuated much recently, this is also because almost no companies are buying raw materials at this time. It is foreseeable that as weaving companies resume work one after another and polyester yarn gradually begins to be sold, the price of polyester yarn will fall further under the pressure of high inventory.
Weaving resumes slowly and demand for raw materials weakens
In addition, the recent progress of the resumption of work in the weaving market is actually not optimistic.
The textile industry is a labor-intensive industry and has very high requirements for the number of workers. However, because the epidemic has affected transportation, a large number of migrant workers have been unable to arrive in time from their residences to the Yangtze River Delta in urgent need of labor. The place.
Judging from what we know so far, the current operating rate in Changshu and Taicang is around 10-20%, Wujiang will be able to restore 30-40% of production capacity by the end of the month, and Haining is slightly better. , but it will take until the end of the month for production capacity to return to 60-70%.
Slow recovery of production capacity will result in low demand for raw materials. At the end of last year, China Silk City Network conducted a survey on the number of goods stocked by weaving companies at the end of the year. The survey results showed that because of the inaccurate prediction of the textile market in 2020, most weaving manufacturers almost only prepared 15- 30 days of raw materials, ready to be purchased and used after the beginning of the new year.
Weaving companies stocking less raw materials should have been a good opportunity for polyester factories to destock. However, due to the slow resumption of work, weaving companies’ demand for raw materials will further decrease, which will also Polyester plants are causing greater inventory pressure.
Dyeing factory production capacity is low, cloth bosses dare not take orders
In addition to the slow resumption of work of weaving enterprises, the problems caused by the slow resumption of work of supporting industries such as dyeing and finishing are even more serious.
In order to produce a qualified fabric, any link in the textile industry chain is indispensable. Weaving companies are slow to start, and there is still a large amount of cloth in stock that can be used. Dyeing and finishing plants need more tailor-made products according to the needs of orders.
But now, the resumption of work in the dyeing and finishing plants is not optimistic.
On February 18, Shaoxing Thermal Power Plant issued a notice stating that it would suspend steam shutdowns. The dyeing factories in Wujiang only resumed part of the pre-dyeing work. It will take a long time to truly return to normal conditions. time.
If the dyeing and finishing process does not resume, textile workers will fall into an embarrassing situation where they dare not take orders. It is true that due to the backlog of demand, there are many orders that can be accepted in the market, but whether the orders can be delivered on time is the thing that has the greatest impact on order acceptance at this stage.
It is precisely because of this situation that the market may be further bearish on polyester raw materials.
When the dark clouds disperse, there will be a rainbow. When will the market turning point come?
Entire There are so many negative factors in the textile industry chain, so when will the turning point of the polyester market come?
Looking at the essence through the phenomenon, in fact, the root cause of all the above problems is almost the ongoing epidemic. If there is noWith the epidemic and so much demand backlogged, it should be a “big bull market” for the textile market.
The good news is that the current epidemic is being quickly controlled.
Recently, the first thing I do when I get up every morning is to turn on my phone and check the number of confirmed cases today. On February 20, the editor suddenly discovered that the number of newly diagnosed people in the country the previous day was only 399, and the number in regions other than Hubei was less than 50.
With the joint efforts of people across the country, the raging epidemic has been very well controlled.
We have reason to believe that in the near future, perhaps at the beginning of March or at the end of March, the epidemic will eventually be completely defeated, and by then almost all the negative consequences will become Good news, the turning point of the market will really come.
For textile companies,
now The most important task at this stage
is to ensure your own survival while doing a good job in epidemic prevention.
When the dark clouds disperse,
a rainbow will appear!
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