Domestic Cotton Prices Plummeted 30% Hard To Say

Cotton prices have been running sideways after nearly 30% of the previous slump. Early signs of a sharp fall in textile and garment sector due to a sharp fall in cotton prices were seen in recent years.

However, analysts believe that

Cotton is the main raw material of the textile and garment industry, so the impact of cotton prices on the prices of textile and apparel listed companies is very obvious.

Since the end of February this year, cotton prices have been falling for a long time, supporting the performance of textile and apparel stocks, especially since April 19th, the market has turned downward, and the textile index has also fallen, but it has rebounded gradually from the end of April.

However, the recent decline in cotton prices continued to decline. There was a sideways shock. The support for textile and garment sectors disappeared and there was a sharp drop in the market. For example, the Shanghai Composite Index fell 2.93% in May 23rd, and the textile index fell by 3.50%.

Summer wear prices rose by two or three.

Although cotton prices continued to fall, it did not affect Guangzhou.

It is reported that cotton prices have declined as cotton prices have fallen.

"Do it in the near future"

However, the general clothing manufacturers will buy cloth several months ahead of time, for example, the summer clothes sold in the market are usually purchased by the end of this year, and the cotton used for these materials is the cotton that went up last year.

In the near future, cotton prices will fall, and the cotton cloth produced will be used in spring clothes next year because of the fact that they use more wool.

However, Huang Xueming believes that next year's spring clothes will not fall because of the fall in the fabric at present. The proportion of cloth occupies the total cost of clothing is not large, generally not more than 10%, especially cotton cloth is relatively low price.

"The fabric needed for a pure cotton dress will be reduced by several yuan to more than ten yuan.

Manpower and freight rates are the biggest, and this part of the price increase is far higher than the price of cloth.

Huang Xueming believes that if other costs do not depreciate, next spring will not only depreciate prices, but will even increase prices.

Institutions watch air textile enterprises

The fall of cotton prices has different effects on textile enterprises and garment enterprises.

After the decline of cotton prices, the prices of textile enterprises are also falling rapidly. The head of a textile enterprise told reporters that the biggest problem now is the downturn in demand. "Downstream consumer enterprises also have the habit of catching up and killing. In the past, cotton and fabric prices rose sharply, the downstream enterprises were very active in ordering, and they were worried that prices would continue to rise. But after the price fell, many people were not in a hurry to purchase, and always felt that they might continue to fall. Only a few small bills and urgent orders would take the goods."

The official told reporters, "the wholesale price of cotton cloth with the highest price last year was 13 yuan / meter, now it has dropped to 9.6 yuan / meter, or about 26%."

The official told reporters that the company's profit may not reach the level of last year, and it will be good to keep it at a loss.

In the reports issued by the securities companies, they are optimistic about the brand clothing enterprises, and are rather pessimistic about the profitability of the textile enterprises.

For brand clothing enterprises, the fall of cotton prices is clear and positive. Most garment enterprises take part in the year's performance in the form of order meeting. In 2011, spring summer wear and autumn and winter clothing are generally raised by 10%~15%. The production cost of autumn and winter clothing is expected to decline significantly, which is conducive to raising the gross profit margin of enterprises in the second half of the year.