Who moved the "cheese" in the fabric market?

So far, the fabric market does not know what to do, just like entering a chaotic world, people feel cold in winter. If it is said that having "cheese" is happiness, then for the fabric market, the order is the cheese of the weaving company. The more important cheese is to you, the more you want to grab it. However, this year's fabric market is like a maze. Weaving companies are striving to trace the traces of cheese, but they find that the quantity found is far from enough to fill their stomachs. Who actually moves their “cheese”? Here I look for this answer from the three markets of macro, raw materials and fabrics.

The Macro Environment of "Internal and External Problems"

"Profit" is the fundamental pursuit for most businessmen. This involves "money." Now the fundamental factors of the appreciation of *** have quietly changed. Since Dec. 5, the exchange rate of the *** has experienced a rare downward trend since the exchange rate reform. As of December 8, the exchange rate of the *** against the US dollar was 6.3319, which was a drop of 0.42% from the November high of 6.3587. This is mainly due to the slowdown of China's economic growth, the drop in export surplus, and the influx of international hot money, which has led to the devaluation of the currency, which jeopardizes the interests of export trade.

In addition, China's export orders index continued to decline in November. The possibility of a recession in the European economy in China’s largest consumer region next year is very high, so export prospects for the next year may be quite slim. At present, weak orders in the international market can better reflect the true picture of China's textile industry's foreign trade. Not only that, in the second half of the year, the proportion of medium and short-term orders reached 88%. The international market is cautious in its operation and is not afraid of making long-term orders. The domestic market is concerned about fluctuations in raw material prices and exchange rates. It is also like a “chicken rib” for long orders, which further reflects the current sluggish growth in the market.

"Unknown" raw material market

Whenever fabrics are mentioned, fluctuations in raw material prices have always been a topic that cannot be avoided. In the fourth quarter, the raw material market has not been clear. Until the end of November, domestic and foreign companies released a signal of liquidity at the same time. As weaving companies warmed up in production and sales, polyester prices began to “float red”, and the production and sales of polyester polyester in the downstream of PTA also saw a growth in the form of blowout, which exceeded its level of popularity. The end of November in the end of the bargain-hunting market. Under the good market conditions, the inventory of chemical fiber raw materials has dropped significantly, and the sales pressure of enterprises has been significantly eased.

Although the raw material market has a spring breath, this did not bring a “timely rain” to the fabric market. At present, more than one month left before the Spring Festival, weaving manufacturers will not continue to stock up for a long time. With the recent drop in the operating rate of weaving companies, the demand cannot be substantially restored, and the raw material market can be said to be difficult to drop, and the upward trend is even more difficult. This has, to a certain extent, also increased the cautious attitude of purchasers to fabric orders.

"Fabric and sad face" fabric market

The current fabric market suffers from the scarcity of orders, one of the main reasons being excess capacity. When the overcapacity encounters a shrinking market, it will lead to a large number of fabrics that cannot be sold. Enterprises must resort to price reduction in order to compete for the only orders, and the direct consequence of the price reduction is to sacrifice profits.

Although the apparent rise in the price of clothing listed in the second half of this year, it is in stark contrast to the drop in prices of chemical fiber raw materials and cotton. The sales price of products has come up. This does not mean that the fabric market has entered a high-profit era. On the contrary, the fabric prices have been “sweeping” in the second half of the year. In addition, the increase in labor costs, the shortage of funds, and the weakening of the US dollar continue to erode the profits of weaving companies. . In the case of Nissan, which has recently changed its price on the market, from the viewpoint of production cost, 210T Nisifang uses nylon DTY70D semi-abrasive yarn as raw material. The current total cost of this fabric is 2.87 yuan/meter. With the various weaving costs, operating costs, etc., Nisi spinning has been on the edge of profit and loss.

The recent domestic grey fabric market sales did not show signs of recovery, most of them are not optimistic about the market outlook, and lack of business confidence, resulting in the market is still dominated by small single transactions. The price of cotton and chemical fibers is still difficult to change. The demand in the downstream terminal market is not as good as traditional expectations. In the past, orders for a style and pattern can last two months or more. This year, it can be done for a maximum of one month. This aspect affects the production efficiency of the company's processing, on the other hand, it also increases the difficulty of purchasing fabrics.

In the author's opinion, the external macro market is not a straight and unobstructed corridor. It can easily see the traces of orders. The raw material market seems to be a maze, making the search for orders even more confused. The fabric market is the venue of the “cheese” and it makes enterprises We compete for each other. Any turmoil in the current market can affect the fragile fabric market and will steal orders of this piece of cheese.