Cotton Textile Enterprises Have Multiple Hidden Dangers &Nbsp; Business Risks Still Exist.

Cotton prices have gone up this year, and the cotton textile enterprises in the mainland have shown that it is difficult to buy cotton, difficult to pport cotton and difficult to recruit. The latest situation is that some cotton spinning enterprises have gone to Xinjiang to build factories, and signed a 7.2 yuan / kilogram guarantee price with the local cotton growers.

Experts predict that cotton spinning enterprises continue to rise in cotton costs, coupled with rising wages and uncertain export factors, the risk of cotton textile enterprises may appear in the second half of the year.

Industry experts also called on the departments concerned to adjust the sliding tax of cotton imports, and integrate the value-added tax from the purchase of cotton and the value-added tax, so as to solve the problem of "high tax and low deduction" of cotton value-added tax.

trend

In the year

Xu Wenying, vice president of China Textile Industry Association and President of China Cotton Textile Industry Association, said that cotton prices began to increase since last October and reached 14833 yuan / ton by the end of last year.

As of June 30th this year, the domestic 328 cotton spot index was 18309 yuan / ton, up 42.6% over the same period last year.

"At present, the trend of cotton rising is still continuing, and each ton has increased by more than 8000 yuan from the beginning of last year."

He said.

Hebei Hongrun new fabric Co., Ltd. produces an annual output of 50 thousand tons of spindles.

Wang Chao, chairman of the company, said that the price of cotton has reached a record high. Xinjiang cotton and local cotton have reached a high level in the past 10 years, and cotton yarn prices have also risen.

Zhang Li, the purchasing manager of the company, told reporters directly: "at the beginning of March, the real estate grade three cotton was 16 thousand yuan per ton, and the supply of cotton was tight in April and May. After the May Day holiday, it rose to 17 thousand and 300 yuan to 17 thousand and 500 yuan per ton.

In June 20th, the price of real estate grade three cotton reached 18 thousand and 500 yuan.

Gaoyang County, Baoding, Hebei, is known as the "China textile base county". Shi Zhisong, director of the flourishing textile Station of Gaoyang County cotton textile dealer, told reporters that the price of cotton yarn has increased by about 1/3 compared with the Spring Festival, mainly due to the rapid rise in cotton prices. The price of Xinjiang grade three cotton at the beginning of March was 16500 yuan per ton.

The rise in cotton prices is not scary. What worries cotton mills is whether they will have money or buy Cotton in the future.

Xingtai Fangyuan textile printing and Dyeing Group is the top 50 leading enterprise in the cotton textile industry.

Song Weili, general manager of the company, said that after the quota of 800 thousand tons was issued by the relevant departments in May, cotton prices continued to rise, and imported cotton increased from 15 thousand yuan / ton to 19 thousand yuan / ton.

The company's cotton inventories have been less than a month's consumption, and buyers have been sent to cotton shops everywhere to prevent the supply of cotton from breaking down after the end of July.

Reluctant sale

Middleman "cover up" to promote cotton prices

There are at least three reasons for the rise in cotton prices: first, the surge in foreign orders this year stimulated the demand for cotton by textile companies, while domestic cotton production is decreasing.

Xu Wenying said that domestic and foreign markets were warming, and demand rebounded gradually, which stimulated the increase of cotton sales. At the same time, cotton production decreased last year and pportation difficulties of Xinjiang's cotton came into being. So the phenomenon of buying cotton was difficult in the mainland.

Hebei Xingtai Weixian County is a large cotton producing county in Hebei province. The cotton planting area is more than 800 thousand mu in the whole year. Due to the decrease of cotton yield and the increase of cost, many farmers have been reducing their planting scale for many years.

In the first two years, Jiang Chunhui, a village in Gu village, Weixian County, had rented 50 acres of cotton in Hengshui at the price of 300 yuan per mu. Last year, he lost thousands of pieces of harvest and stopped leasing and returning to the village.

Jiang Chunhui told reporters that he had the same experience as 12 households, and some cotton growers have replanted watermelon, pepper and other economic crops with high efficiency.

Jiang Chunhui's helplessness is a microcosm of the decline of cotton planting area in Hebei and even the whole country.

In recent years, Hebei Province

According to the reporter's understanding, under the influence of low temperature and rainy weather, the spring sowing time in the main cotton areas of the Yellow River River Basin and parts of the Yangtze River Valley is generally delayed by one to two weeks compared with the previous years, and the northern part of Xinjiang has also been postponed.

Recently, some parts of Southern Xinjiang suffered frostbite and severe storms and rain.

It is generally predicted that the imbalance between supply and demand of basic cotton will hardly change in the near future.

Secondly, the decline of world cotton production has a direct impact on the import of cotton by domestic cotton textile enterprises.

It is understood that India has restricted exports because of its lack of cotton.

Finally, middlemen maliciously hoarded and drove up prices.

Song Weili said that because of the state's suppression of the property market, some hot money instead of speculation cotton.

At present, Xinjiang cotton is difficult to pport. The cotton in the market is mainly concentrated in the hands of middlemen besides the national reserves.

Some middlemen in the South have hundreds of thousands of tons of cotton in their hands, all of which are grade three cotton.

But these middlemen are reluctant to sell and are generally optimistic about the market. They can't buy Cotton in the market.

pressure

Cotton textile enterprises have multiple worries

The continuous rise of cotton prices is likely to bring greater pressure to the cotton textile enterprises that have just slowed down.

Xu Wenying told the economic reference Daily reporter that from 1 to May this year, the profit and output value and profit growth of Enterprises above Designated Size in the cotton textile industry basically reached the level of the same period in 2008 before the financial crisis.

However, he said: "the market situation of cotton yarn production and sales in the first half of this year is abnormal.

First, the demand for domestic and foreign market is increasing. The two is facing the trend of rising prices of cotton and gauze, so that buyers can purchase and store up and replenishment for buying up and maintaining value. At least two months' cotton yarn is stored in cloth factories and knitting factories.

This is not the rigid demand of the textile industry. "

Xu Wenying said that the development of cotton spinning enterprises is facing some uncertain factors. First, the price of raw materials is rising.

He said that in the first half of this year, enterprises with more capital were hoarding cotton, cloth factories and knitting factories were hoarding cotton yarn, and many spinning mills had received two times of orders in previous years.

The price of yarn has gone up, but the profit of cotton mill is improved. However, downstream factories and printing and dyeing factories and garment factories are facing difficulties.

Because the demand for clothing in the market has not increased rapidly, the unit price of garment export has also declined in March.

In addition, although the new cotton listing in October may lead to a fall in cotton prices, the fall in yarn prices will lead to the dilemma of rising costs for hoarding high priced cotton enterprises.

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The rise in labour prices is another big difficulty.

Xu Wenying said that the workers in the cotton textile industry had low wages and worked hard.

But salary increases will be faced with cost pressures.

This industry is rather small, and the profit margin of all enterprises has been hovering around 3%. Moreover, cotton textile industry is characterized by the fact that 1/3 enterprises have completed about 95% of the profits of the whole industry. Most enterprises are in a state of deficit, and it is not difficult to raise wages for workers.

There are also uncertainties in the future export of cotton textile products.

Analysts at the first venture research institute, Guo Guo Xian, said that the export of textile and clothing is facing a severe situation in the second half of the year. The main export markets, the employment data in the United States are relatively bad, the economic recovery is slow, and the European market is more and more sovereign debt crisis, and the market demand is more difficult to grow.

In addition, the rising cost of raw materials and labor costs are squeezing the gross profit of export enterprises, coupled with the pressure of two-way fluctuations in the RMB industry.

decompression

Experts call for adjustment of sliding duties

For the predicament that cotton spinning enterprises may face in the future, Xu Wenying appealed to the departments concerned to adjust the slip tax on cotton imports, and unify the added value tax in the purchase of cotton and the tax burden on value-added tax, so as to solve the problem of "high tax and low deduction" of cotton value-added tax.

Xu Wenying told the economic reference daily that since May 2005, the state has applied the sliding tax to the newly imported cotton. The current tax rate is 5% to 40%. The aim is to keep the price of imported cotton and domestic prices flat by promoting the sales of domestic cotton and protecting the interests of domestic cotton growers when the international cotton price is lower than the domestic cotton price.

In fact, from October 2007 onwards, the price of international cotton in many months is higher than that in China, and sometimes even higher than 20%.

In this case, the textile factory still pays the lowest 5% sliding tariff, which makes the Chinese cotton textile industry in a very unfavorable international competition environment.

"We believe that the original intention of the state to introduce a quasi tax policy for protecting the interests of cotton farmers is correct.

But for a long time, due to the implementation of this policy, the domestic cotton made by Chinese cotton textile enterprises is 1000 yuan / ton to 1500 yuan / ton higher than the international market, which makes the international competitiveness of Chinese cotton textile enterprises lower.

The protection of agriculture should not be sacrificed at the expense of the international competitiveness of the textile industry. The cotton textile enterprises have collapsed, and the impact is still agriculture.

Because cotton import quotas are issued according to the gap of domestic cotton, the time of issuing new quotas is generally around 4 to May. When the import contract is signed, the time for cotton to port is 6 to July, when cotton farmers have sold more than 90% cotton, and most of the market's cotton is in the hands of cotton processing enterprises and circulation enterprises. At the same time, levying quasi tax on imported cotton will only protect the interests of cotton processing enterprises and circulation enterprises, which not only increases the cost of textile enterprises, but also does not bring the real benefits to farmers.

Xu Wenying proposed to abolish the sliding tax and replace it with farmers' Cotton Subsidy.

Xu Wenying also suggested that cotton textile enterprises should keep their entries and sales value-added tax rates consistent.

He said that in 1994, the tax rate of cotton was 13%, and the value-added tax rate of cotton spinning products was 17%.

Therefore, in cotton textile enterprises sales process, the deductible cotton input tax rate can only be 13%, cotton textile enterprises bear about 4 percentage points of the unreasonable tax burden, this is unfair, it is recommended to unify.