Cotton Prices Increase Profits Reduce &Nbsp; Textile Enterprises How To "Winter"

Data released by Chengdu customs showed that in this year, Sichuan exported a total of US $890 million of textile yarn products, an increase of 58.1% over the same period last year.

However, Chengdu Customs said that because of the rising cotton prices, the profit margins of textile enterprises are being substantially reduced.

Some enterprises have begun to cut production.

Quotation

"In the 1-10 month of this year, the company's exports increased by about 30%."

Wan Weiping, chairman of the Provincial Textile Import and export limited liability company, said, "but the growth rate has slowed down obviously compared with the 1-9 month 50%."

Since October, orders for enterprises have begun to decrease, and many factories have ceased production, "because cotton has a price per day."

Data show that domestic

China's annual cotton demand is 700 thousand -800 million tons, an annual import of 200-300 tons.

Due to the export ban of India, the largest cotton importing country in China, the major cotton producing areas in the world are suffering from disaster reduction, resulting in a very large gap between supply and demand of cotton.

China's Ministry of agriculture's Rural Economic Research Center released data on 18 October. In 2010, the total area of cotton planting in China was 76 million 851 thousand mu, 47 thousand and 900 Mu less than last year, and the total output is expected to be slightly reduced.

Demand for textiles is strong and demand is rising.

Another important reason is the speculation of idle capital.

Not long ago, the purchasing department of Sichuan Hui Mei line company went to Xinjiang, Shandong, Henan and Hunan to purchase raw materials. It turned out that the cotton had not been picked up, and had been bought by the hot money.

There is even a phenomenon that there is no price.

Analysts say that because of the serious excess liquidity in the world, cotton and other raw materials become fried products.

Influence

When the river rises, the boat floats high,

The tide rises.

Nowadays, the textile and garment industry is booming.

The upstream products -- textiles, yarns, etc. have been generally raised by 25%-30%.

In the Chengdu market, clothing prices rose by about 20%, and the price of brand clothing doubled even over the same period last year. The average cotton coat is about 1000-1500 yuan.

But in the tide of price rise, the profit of the industry has dropped by about 20%, and some enterprises have even suffered losses.

Negotiations with customers are also getting more and more difficult.

Wei Daojun, manager of the Trade Department of Sichuan Hui Mei line company, said that cotton prices have already broken through the cost line of the business, and it is difficult for foreign investors to accept the latest quotations.

Chengdu Customs said that export enterprises should not only bear rising prices of raw materials and labor, but also pressure on appreciation of the renminbi.

If the RMB appreciation rate is accelerating, it will seriously affect China's textile and clothing exports and industry stability.

Domestic customers directly reduce orders.

Provincial Textile Import and Export Co., Ltd. began to purchase half of the price of chemical fiber than cotton.

Garment processing enterprises in Jiangsu and Zhejiang provinces and Pearl River Delta regions have begun to stop production.

A boss named "very clothes road" in Chengdu jade Double Road said that the replenishment had only been waiting for three days before, and now we have to make a telephone reservation in advance for half a month or even a month.

Countermeasures

Developing the right products and improving the quick response ability

At present, the state is taking measures to protect cotton supply and demand and stabilize prices.

Chengdu customs officials suggested that enterprises should speed up technological pformation and independent brand building, continuously improve their core competitiveness, strive to develop marketable products, enhance their rapid response to market demand, improve the structure of export commodities, strengthen cooperation with neighboring countries (regions), reduce dependence on textile export markets in Europe and the United States, and further develop domestic two or three line cities and rural consumer markets.

Customs data show that the export of Sichuan's textile products to Africa and ASEAN market increased by 48.8% and 1.2 times this year.

According to the provincial Commission, the sales revenue of Sichuan textile industry can reach 80 billion yuan this year, an increase of 30% over last year.

The Sichuan textile industry has the ability of initial processing and terminal manufacturing, but the intermediate printing and dyeing and fabric processing links are weak. It should also guide more enterprises to enter the park, create brands and improve the industrial chain. At the same time, efforts should be made to make Chengdu a "Shi Shangpin capital city" and play a role in Chengdu's consumption of Western clothing and luxury goods, thus forming a textile and garment design and development platform and promoting industrial development.