RMB Appreciation Swallowed Foreign Trade Profits &Nbsp; Northeast Hosiery Enterprises Only Earn Processing Fees To Survive.

"Transformation is too much pressure."

When he said this, Mr. Zhang, manager of a Hosiery Industry in the Northeast socks industry park of Liaoyuan, had no choice but to speak.

She said, before the company directly contacted with foreign customers, take the list of foreign trade, such a large profit.

However, as

She said, now only to ensure that the machine can run normally, workers have food, even if it is profitable.

Zhang recalled, "at this time last year, telling the truth was not so good this year, but at that time it felt that business was much better than it is now.

Because the orders received were not as many as those of the same period this year, but the profit margins were much larger than the current ones.

Taking a pair of socks as an example, the export orders for the same period last year could reach nearly 1 cents when the profits of each pair of socks were the highest. Since the end of last year, the price of cotton yarn has risen sharply, and the RMB exchange rate has even reached a record high with the US dollar.

She said that the scale of the socks factory was not very large. It was only because there were some channels that foreign trade orders could be received. "Before the RMB exchange rate was relatively stable, the order of foreign trade was slightly higher than that of the domestic market, and the factories were small, so they also pursued high profits and had been doing business in foreign trade, but now it seems more and more difficult to do."

Zhang told reporters that since the beginning of the first half of this year, the appreciation of the renminbi has continued to appreciate, and the factory has begun to pick up foreign trade orders less until the final export orders are not available.

Earning only processing fees to survive

Mr. Zhang, who originally only made foreign trade orders, did not accept foreign orders, so how did factories survive?

"It has been pformed, of course, the factory is still producing socks, but no longer contact with foreign trade orders, I know that our socks are still sold abroad, but through foreign trade companies directly contact with foreign manufacturers, we only comply with the requirements of foreign trade companies processing."

Although the profit from raw materials processing is also low, it can at least maintain the operation of the factory and not let the workers go home on vacation.

Manager Zhang said that since May this year, socks industry has been in the off-season, cotton yarn prices are at a high level, the pressure of RMB appreciation is increasing, and foreign trade orders are not good.

"The difference between foreign orders and incoming processing is that foreign trade orders require us to store a certain amount of cotton yarn for production, while processing materials is more economical. The other side will provide us with the raw materials needed for weaving, and will also provide us with the styles. We only need to produce according to the colors provided by the other party, so there is no need to take risks at all."

Really do foreign trade orders also involve market research and development, need to understand what the foreign market demand, what color is interested, market prospects can only be processed, and can not be sold, "this is also risky, because sometimes the market research and development is not done well, resulting in aesthetic differences, products may backlog.

And the processing of incoming materials avoids this risk. However, this practice is only the frustration of increasing the pressure of RMB appreciation, and it does not want to be eliminated by the market, so it chooses the lower profit processing.