Textile Industry Enters The Era Of High Cost

The rising prices of raw materials, the rise in labor prices, the continued appreciation of the RMB exchange rate, coupled with the reduction of the export tax rebate rate and the continuous rise in loan interest rates make the textile industry in a state of oversupply, and there is little room for shifting costs and raising prices.

Recently, the price increase of oil and electricity will increase the production cost and pportation cost of textile enterprises, and the competitiveness of product prices will once again weaken, which will cause new impact on the industry.

Substantial increase in production costs

The textile industry is a large demand for electricity, especially in chemical fiber industry.

According to the statistics of thousands of energy consuming enterprises in the country, the viscose filament and the vinylon industry ranked first, second in the chemical fiber industry, and the energy consumption is 2~3 times higher than that of the electrolytic aluminum, copper processing and caustic soda industry, while viscose staple fiber and acrylic fiber are ranked eighth and twelfth respectively, and the energy consumption ranks the front.

According to the statistics of China Chemical Fiber Association, the energy consumption of chemical fiber industry was 22 billion 200 million degrees in 2007, and the unit energy consumption was 972.5 kwh per ton.

The national sales price increase, according to last year's energy consumption calculation, the cost of chemical fiber will directly increase 24.3 yuan per ton, chemical fiber industry will increase the total annual electricity consumption burden of 555 million yuan, only this expenditure accounted for nearly 4% of the total profit of the industry.

At the same time, as oil prices rise, the cost of oil related energy and raw materials will increase significantly, especially in the chemical fiber industry. Oil is an important raw material for industrial production, and the increase in oil prices will directly increase its production costs.

Due to the serious overcapacity in the chemical fiber industry and the fierce competition in the market, the way of pferring the cost through raising prices has been greatly restricted.

Moreover, after substantial price adjustment, the pportation cost will increase significantly and the sales cost will increase substantially.

Obviously, the textile industry has entered the era of high cost.

Look forward to the new industrial policy

As the industry continues to slump, enterprises can not maintain, in recent years, stop production, parking or shutting down a lot.

To reverse the overall decline of the industry, only hope that the industry will usher in new industrial policies: first, the margin of processing trade margin is "idling"; the two is the implementation of temporary cotton sliding rate policy; and the three is the export tax rebate policy which is likely to be implemented in July.

As the textile industry is one of the pillar industries in China, especially in solving the problem of surplus labor force and so on, it has an irreplaceable role.

The industry has been calling on the Department of duty to lend a helping hand to ease the cost of the textile industry and help the textile industry get out of the industry downturn.

If the above industrial policy becomes a reality in the short term, it is expected to add 18 billion 500 million yuan gross profit to the textile industry, which is undoubtedly a great advantage for the textile industry.

The three category is worth noting.

It is worth noting that in the early stage of recession, many listed companies have diversified, hoping to get the opportunity to survive in the industry through the development of other businesses.

Such as black peony to group company private placement, in order to obtain commercial real estate and other real estate business, so that the company's valuation center shifted upward.

From the perspective of value investment, the overall investment value of the industry is not large at present, but the three types of stocks in the industry deserve attention: through the industry shuffling, the industry quality enterprises with brand effect, the more successful companies in the industry and the enterprises in the upstream part of the industry.

Such as the manufacturer of dye.