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Cotton Prices Are Soaring &Nbsp; Enterprises Are Forced To Pform.

2010/10/1 17:38:00 77

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Cotton Capital Commodities

With the rapid rise of international cotton prices, China's cotton futures and spot prices have reached a record high.

For cotton producers, this is a good thing, but for cotton,

Raw material

For enterprises, it is a disastrous event.

From a large perspective, China, as a larger cotton importer, is undoubtedly one of the victims of rising cotton prices.

cotton

Soaring prices are caused by multiple factors.

Among them, there are both reasons for the reduction of global cotton production, as well as the reasons for the flooding of US dollar liquidity.

As an integral part of the world economy, China's economy has long been closely linked with the world economy.

This means that the international

commodity

Prices will largely affect the prices of similar goods in China.

I dare not say whether there is a shadow of the US government behind the price of cotton, but the soaring price of cotton has more advantages than disadvantages for the United States.

Through the continuous depreciation of US dollar, on the one hand, it can increase the competitiveness of its export enterprises, on the other hand, it can relatively reduce its huge external debt.

Therefore, the soaring price of cotton is the inevitable result of the depreciation of the US dollar.

However, it should be emphasized again that for China's cotton importing country, the appreciation of the renminbi and the soaring price of cotton have seriously reduced the international competitiveness of the relevant export enterprises, and squeezed the space for their survival.

At present, the profit margin of China's textile industry is relatively low, only about 4%, and most of them are labor-intensive.

enterprise

。

Relying on cheap labor and raw materials, China's textile export enterprises can take advantage of low price products in the international market.

Soaring cotton prices have kept their costs rising, and the continued appreciation of the renminbi has severely squeezed the living space of such enterprises.

A large number of such small and medium-sized enterprises have been forced to stop production in Jiangsu and Zhejiang provinces, resulting in a large number of unemployed employees.

The textile and garment industry is only a microcosm of many export processing foreign trade enterprises in China.

In fact, when international commodity prices continue to run at a high level, many domestic related foreign trade processing enterprises have been affected to varying degrees.

According to media reports, the high price of raw materials and the appreciation of the renminbi have destroyed many small and medium-sized steel traders.

Then how can Chinese enterprises cope with this passive situation?

The author believes that for domestic labor-intensive enterprises, simple price advantage competition has been proved to be outdated and inconsistent with the current competitive situation.

Now, only by developing products with independent brands, self created characteristics and high technology content can we survive in this cruel competition world.

It is urgent for enterprises to turn from extensive to intensive.