Industry dynamics

The boot rate is declining! No orders, no funds, the order receiving atmosphere is not harmonious --

日期:2021-12-18 15:59:59

Now the market once again worries about the new super COVID-19 variant, which affects demand recovery. The price of the whole industry chain, including oil prices, has collapsed. Near the end of the year, the textile market will come to an end, and the decline of prices is expected. However, the "roller coaster" market caught textile people unprepared and unbearable. At present, textile, garment and other enterprises are living in the cracks of sharp rise and fall in raw material prices, low prosperity of terminal orders and tightened credit policies.

Cotton yarn prices fell at home and abroad

Polyester staple fiber prices continued to decline

     Last week, the "Omicron" mutant strain further aroused market concerns, superimposed on the sluggish downstream demand, and also had a certain impact on the products in the textile industry chain. After the sharp decline in domestic cotton prices, it rebounded slightly, and the international cotton prices fell sharply; Cotton yarn prices at home and abroad continued to fall; Polyester staple fiber prices continued to decline.

The blockade measures implemented by many countries have reversed the relationship between global cotton supply and demand. Many countries around the world quickly implemented blockade measures. The Federal Reserve said that economic activities in many parts of the United States were limited by supply chain disruption and labor shortage. In the international cotton market, the cotton supply in the northern hemisphere has further increased, the American cotton harvest has been completed by 85%, and more than half of the Indian cotton has been sold. The new mutant strain further hit market sentiment, and U.S. consumer confidence fell to a nine month low in November. Last week, the US cotton loading volume was 16700 tons, a year-on-year decrease of 64.0% and a month on month decrease of 28.7%.
 According to the global production and demand forecast of the International Cotton Advisory Committee (ICAC) in December, the consumption in 2021 is adjusted to negative growth for the first time. It is expected that the global cotton consumption in 2021 will be reduced by 390000 tons to 25.63 million tons compared with the previous period, a year-on-year decrease of 0.1%; Cotton output increased by 10000 tons to 25.73 million tons compared with the previous period, a year-on-year increase of 5.9%; The inventory consumption ratio was 79.8%, with a year-on-year increase of 0.5%. The implementation of blockade measures by many countries has further darkened the prospect of global cotton consumption, weakened the consumer demand for textiles and clothing, and the order situation of the textile industry in Southeast Asia, which has just improved, is facing a test. In the short term, market pessimism shrouded, and the international cotton market continued to be under pressure.
Cotton textile market pressure is not reduced, beware of the risk of cotton price decline. Dragged down by weak demand and employment, the manufacturing boom of small and medium-sized enterprises fell into the contraction range again. China's Caixin manufacturing PMI in November was 49.9, down 0.7 percentage points from October, and again below the boom and bust line after August.
 In the domestic cotton market, the processing volume of new cotton is more than half, and the sales have not improved. According to the survey of the national cotton market monitoring system, the total national new cotton output in 2021 is expected to be 5.801 million tons, a year-on-year decrease of 2.5%, of which the cotton output in Xinjiang is 5.262 million tons, a year-on-year increase of 0.2%; Last week, China processed 497000 tons of lint, down 19.2% month on month, and sold 97000 tons of lint, down 24.6% month on month. The operating pressure of the downstream textile market has not decreased, the situation of insufficient domestic demand and weak foreign trade orders has not improved, the return of funds from price reduction sales of textile enterprises has gradually become the mainstream, aggravating the continuous weakening of profits of textile enterprises, and a few textile enterprises have issued a notice of Early Spring Festival holiday. In the short term, the power of the mutated virus will attack market confidence and further increase the operating pressure of cotton textile enterprises. It is necessary to pay attention to the impact of changes in the external environment on the cotton market.
Weakening of order receiving atmosphere
The startup rate decreased and the inventory increased
With the arrival of December, the textile market also seems to have entered the closing stage, with orders plummeting. With the decrease of orders, the startup rate of weaving enterprises is general and shows a downward trend. At present, the overall startup rate has decreased slightly. According to the data monitoring of China silk capital network, the startup rate of water jet and air-jet looms in Shengze area is 72%, down 1% from last week. Although the decline is small, it also indicates that the market is gradually weakening.


After three months of power and production restriction in the early stage, it is not easy for normal production. Even when there are few orders and the goods are generally delivered, most enterprises are still reluctant to reduce the start-up. Therefore, from the start-up rate alone, we can not clearly see the order receiving situation of the market.

      The change of inventory can better reflect the trend of the recent market. According to the data monitoring of China silk capital network, at present, the blank warehouse of water jet and air-jet weaving enterprises in Shengze area exists for about 30 days. It increased by 0.2 days over last week and 1.7 days over the same period last month.


On demand production

Centralized goods preparation at the end of the year no longer exists
       Then, towards the end of the year, at the closing stage, there will naturally be some out of order situations in the market. Some enterprises receive orders better and some enterprises receive orders coldly.
       According to the enterprise feedback, there are few orders on hand at present. The centralized goods preparation that would have been carried out at the end of the year has also been changed to on-demand production, and the production mode can be changed flexibly according to the market situation. Not stocking also shows that there is no shortage of inventory in the current market, and textile people are not optimistic about the market next year. In particular, the continuous rise of polyester filament in October led many manufacturers to buy a lot of raw materials, which have not been used up yet.
Actual situation of textile clusters in Jiangsu and Guangdong
 Recently, there have been a lot of news about the negative profits and large losses of current textile enterprises. Some small and medium-sized textile enterprises have taken measures to reduce production. What is the actual situation?
Jiangsu grey cloth: the current construction is normal, with an average opening rate of more than 95%. During the double 11 promotion period, it is mainly to digest the inventory fabrics, and there are few orders for new products. At present, the orders on hand vary from 10 to 30 days. The delivery of conventional varieties is slow, with few quotations and few actual orders. Affected by the rising price of upstream raw materials, the downstream home textiles and clothing procurement are cautious. Due to the high prices of raw materials and dyeing fees, unclear delivery date and the increase of power cost, the profit margin of grey cloth decreased. Orderly power consumption is gradually normalized, but the rise of power cost will further affect profits. As the price of raw materials fluctuates, it remains to be seen whether downstream customers can bear the pressure of price rise, and sales are expected to slow down further.
Guangdong denim: Recently, denim yarn prices have been running at a high level, product price transmission pressure is still large, it is difficult to raise denim prices, enterprise operating rate has reached more than 95%, orders have improved, and inventory has decreased slightly. At present, the power consumption pressure of enterprises is relieved. When the raw material price is high and the downward transmission is slow, customers are cautious in placing orders.
Lanxi grey cloth: the price of raw materials is still high, and the production cost of enterprises is high. At present, autumn and winter fabric sales are coming to an end, while spring and summer fabrics have just begun to be printed, resulting in few orders in the downstream market. The grey cloth inventory of the enterprise is at a high level and has a growth trend. The power restriction situation is slightly relaxed, but the follow-up situation is uncertain, and the factory is on the verge of loss. The market is full of uncertainty in the later stage, and it is expected that there may be a turnaround after mid December.
Jiangsu yarn dyed fabrics: the overall market is weak, the opening is basically normal, and the product price is relatively stable. Affected by the weak downstream demand, the continuous high upstream yarn price, the fluctuation of RMB exchange rate and other factors, the internal and external orders of the enterprise are weak, the cost is high, the profit is thin, and the yarn procurement is mainly rigid demand. It is expected that the current operation of the market will continue in the short term, and most enterprises are cautious.
Hubei pure cotton: the price of raw materials has been relatively stable recently, but it has been at a high level, and the cost pressure has not decreased. The downstream has a general acceptance of prices. Orders have been issued, basically small batch orders. At present, production is mainly based on orders, and conventional varieties have no inventory. At present, the domestic and foreign market demand is not satisfactory, especially the foreign trade orders have not improved, there are few orders, and it is expected that there will be little change in the short term.
It's helpless to sell goods without orders and funds,

Recently, with the end of the "double 11", the weaving market also began to return to desolation, especially the domestic orders decreased significantly, while the foreign trade orders improved. But the whole grey cloth market is hard to hide the signs of decline, grey cloth prices fall and inventories rise

Even the popular elastic cloth has lost its former style, and the quantity and price have fallen together! According to a person in charge of a manufacturer specializing in the production of elastic cloth, said: "recently, the domestic market is too weak, and no one wants to sell goods. No one wants to throw 2.2 of 100D four-sided bombs, and the front has to sell 2.4-2.5, which can't be sold by directly reducing 0.3 wool!"


It is understood that the current grey cloth price has already fallen from a high level, and is still declining, and there is a phenomenon of selling goods in the market. According to the monitored sample data, the grey cloth inventory has risen to about 29.1 days recently. With the recovery of the market startup rate, the previously tired inventory has not been eliminated, and the new grey cloth has been woven, and the grey cloth in the factory has begun to get tired again. Although boss Bu knows that selling goods can not solve the fundamental problem and plunge the market into a vicious circle, they are forced by many helplessness and finally embark on the road of selling goods.
 But selling goods can not save the high inventory. In the final analysis, it is because there are no orders and no funds! After the grey cloth price rises and falls, it may be a good time for speculation, but now there is no group of speculators in the market. A very important reason is capital! Near the end of the year, everyone is withdrawing funds and pulling money into their hands, which is why polyester fell by nearly 3000 yuan / ton and production and sales are still light. All enterprises are tightening their pockets. No one is willing to spend money without substantive orders. In terms of orders, for the domestic market, this year's orders have basically ended. Before the Spring Festival holiday, it will mainly turn orders and supplement orders in small batches, which is difficult to reproduce in large quantities.
Therefore, oversupply is bound to happen. I'm afraid it will be difficult to alleviate the manufacturer's inventory next. The manufacturer also said that the current selling price is not bought, and the price will fall again. However, if the grey cloth price falls below the bottom line and the selling effect does not take effect, then the manufacturer should have a holiday to reduce production and supply.
Source: zhongchu cotton, cloth factory, silk capital network, chemical fiber headlines, printing and dyeing people, network
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