Cotton Is Rising All The Way, And The Textile Industry Is Struggling.

Since last year, affected by the domestic and international cotton supply and demand, the cotton purchase price of cotton textile enterprises in Yantai has been rising all the way, which has a significant impact on the textile enterprises.

Recently, the Yantai investigation team of the National Bureau of statistics investigated 3 cotton textile enterprises in Yantai and 2 cotton textile processing enterprises.

Judging from the survey, the cotton textile industry in Yantai is now on the rebound, but the price of raw materials continues to rise, making many textile enterprises struggling.

Since last year, especially since the second half of last year, the cotton purchase price of cotton textile enterprises in Yantai has been rising all the way from the domestic and international cotton supply and demand. The average price of cotton from 1 to May is 16540 yuan / ton, an increase of about 28% over the same period last year, which is 21% higher than that in the second half of last year. In May, the price rose several times, and the highest price reached 18200 yuan / ton in late May, up 36.3% over the same period, up 19% over the beginning of the year.

The average purchase price of cotton yarn reached 25200 yuan / ton in May, up 50% over the same period last year, up 31.2% from the second half of last year, 27.6% higher than the beginning of last year.

Because of the non cotton production areas in Yantai, the raw materials of cotton spinning enterprises rely on the purchase from other countries (mainly in Shandong, Xinjiang and other places, imported from other countries such as India and the United States).

The main manifestations are:

Shortage of raw materials and shortage of stock.

As cotton and cotton yarn prices rise and rise again, raw material supply is tight. At present, the purchase quantity of raw materials in 5 enterprises is reduced than before, and the inventory of cotton and cotton yarn is obviously insufficient. In the past, the inventory capacity could meet the production volume of one month, and now it only lasted for about 5-7 days.

Some enterprises have already seen the bottom of stock because they do not have enough purchasing funds.

Cotton cotton yarn prices rose, but textile processing products prices rose little, affecting the development of cotton textile processing enterprises.

Judging from the 5 survey enterprises, cotton prices have risen and hit record highs, and have spread to the whole industrial chain.

The increase in cotton yarn prices is not in sync with the increase in cotton prices, but the price increases are even smaller.

From the perspective of the whole industry chain, the rise of cotton yarn price has digested the rise of cotton prices. Cotton processing plants and spinning enterprises are in the upper reaches of the industrial chain. The price of raw materials can be amortized downwards, but the enterprises in the lower reaches such as weaving, clothing and so on have to bear the pressure of increasing cost steadily, and all links in the distribution of profits are also decreasing.

At present, with the rising cost of raw materials and labor, the production cost of weaving and garment production and processing enterprises in Yantai has increased by 10%-15%. However, due to the small increase in the price of cloth and clothing, the profit of processing enterprises has decreased by 3%-4%.

The start up rate and order situation of large and medium-sized cotton textile enterprises are far better than that of the same period last year. The total production volume has obviously increased, and the production and operation of small enterprises is not very good.

According to the survey data, the order of 5 enterprises in 1-5 months is obviously better than that of the same period last year, the total production increased by more than 21% over the same period last year.

According to statistics, in 1-5 months, the total cotton yarn production of cotton textile enterprises above Designated Size in Yantai was 3781 tons, an increase of 31.2% over the same period last year. The total production of cotton cloth was 837.5 tons, an increase of 46.6% over the same period last year, and the total production of clothing was 94 million 30 thousand, up 13.4% over the same period.

Judging from the survey results, cotton and cotton yarn prices are rising too fast, and raw material supply is tight. No matter cotton textile enterprises or cotton textile processing enterprises, they are afraid to pick up orders after 10-15 days.

As the price of cotton yarn has eroded profits, cotton textile processing enterprises with small scale and small amount of funds have stopped ordering, production is still not very good, the overall start-up rate is still at a low level, and the operating rate has declined.

Profits increase.

Judging from the survey, large and medium-sized textile enterprises, with the increase of orders, the expansion of production volume, and the rise of yarn prices, are currently raising profitability, operating profit growth is relatively fast, the mentality is more optimistic than before, and the bearing capacity of cotton prices is also increasing.

Compared with the same period last year, the 5 companies surveyed have improved their profits, 3 profits have increased 15% to 20%, and 2 have turned the profit into a deficit. The 1-5 companies have made a profit.

It shows that the production situation of textile enterprises in Yantai has obviously improved and the level of profitability has improved.

The payment of goods in cotton textile processing enterprises is rather heavy.

Owing to the unwritten hidden rules and the shortage of cotton and cotton yarn resources in cotton textile enterprises, the flow of capital in cotton textile enterprises is quickening. Buying cotton and cotton yarns are cash pactions, or advance payment and order, and there is no payment in arrears. However, the phenomenon of arrears of money in cotton textile processing enterprises is widespread, and capital recovery is difficult.

Judging from the comprehensive survey, the price of raw materials continues to rise. Many textile enterprises are facing greater pressure on business, with more problems and greater difficulties: tight supply of goods, insufficient procurement funds, affecting the normal production of enterprises, lack of liquidity, small support from banks, difficulties in financing enterprises, increasing cost of raw materials, labor and pportation, resulting in an increase in the cost of production of products, an increase in demand for labour and insufficient employment of enterprises, and difficulties in the operation of cotton textile processing enterprises.

Because of the increase in cloth prices far less than the price of cotton yarn, cotton textile processing industry, such as weaving factories, garment factories and so on, has such problems as shortage of funds, shortage of raw materials and so on. It is generally felt that it is difficult to operate, and with less profit, some small weaving factories have planned to stop work.

According to the insiders, cotton prices have a direct impact on the normal production of cotton textile enterprises. Due to the shortage of cotton stock in the domestic spot market and the reduction of commercial inventories, the cost of imported cotton remains high, and many factors such as downstream yarn and cloth sales are driving up. Cotton prices are hard to fall in the near future.

But because of the rapid rise of domestic cotton prices at present, business opportunities have been brought to the cotton textile industry's recovery and development.

However, the rise in cotton prices will inevitably lead to an increase in the cost of textile raw materials, which is undoubtedly a great resistance to the domestic textile industry that is struggling to get out of the predicament, and is still not optimistic from the overall situation.