Cotton Price Is Inverted "V" Word Market &Nbsp; &Nbsp; Many Textile Enterprises Go Out Of Stock At A Loss.

Over the past year or so, textile raw materials have gone up and down, making many business executives sigh as if they had taken a roller coaster ride.

Since March, domestic textile prices have dropped sharply.

Less than two months, raw cotton, viscose higher than the previous high has fallen nearly 10000 yuan, yarn prices also fell, last week, Qian Qing.

"The heart is beating, and the heart is falling."

Fu Jiabao, director of Xiaoshan peace spinning factory, described his mood.

It is reasonable to say that textile raw materials have fallen sharply, so that many textile upstream enterprises, spinning mills, bear great pressure.

In May 24th, the China Cotton Association held an expert consultation analysis on the industry information early warning system. The incentive was that domestic cotton prices had dropped sharply in recent years, resulting in the poor purchase and sale of cotton and serious losses in the industrial chain.

China Cotton Association data show that in May 26th, China's cotton price index (CC Index328) was 24479 yuan / ton, the price was almost the same as that in mid October 2010, but behind the seemingly calm price change, it concealed the trend of cotton prices in 7 months, such as roller coaster.

Since the beginning of this year, cotton prices have shown the word "V".

Since the beginning of the year, around 27000 yuan / ton has risen to 31241 yuan / ton in March 8th. After that, it turned all the way down and went out of the lowest point in May 26th, which has dropped 22% compared with the high point in the year.

Peng Fei, deputy general manager of Shah shark International Group Co., Ltd. said that the trend of cotton prices has caused many textile enterprises to bear enormous pressure from the market.

Take Textile City Xiaoshan as an example. Last year, when the market was hot, many textile enterprises were generally bullish on raw material market and purchasing raw materials in large quantities.

Nowadays, high inventory has become a problem. Many enterprises can only sell and sell at a loss.

Many textile enterprises go to inventory at a loss.

Over the past two days, many textile enterprises in Xiaoshan have been clearing stocks.

Miss Shi, sales manager of a textile company in Xiaoshan, said most textile mills are now very high inventories, generally in about a month and a half.

Ding Xiaohong, manager of the business department of Zhejiang Yide Textile Co., Ltd., said that the price of cotton raw materials has dropped from 33 thousand yuan per ton to 25 thousand yuan per ton at the beginning of the year. Even if the price dropped by 8000 yuan per ton, cotton prices were still high, while cotton yarn products had a larger decline, which not only led to a decrease in many enterprises' orders, but also reduced the profits of the products.

It is not only cotton spinning enterprises, but also light textile enterprises with man-made fibers as raw materials.

A staff member of Xiaoshan Phoenix Textile Co., Ltd. said that the price of man-made fiber has dropped from the price of 29 thousand yuan per ton to 20 thousand yuan per ton at the beginning of the year.

Moreover, after the Spring Festival this year, there are frequent shortage of labor in our province, the wages of workers are rising, and the cost of employment has risen sharply.

The head of a textile enterprise in Xiaoshan said that the cost of local labor doubled by most of the previous year, and the cost of loaders increased from 15 yuan / ton to 30 yuan / ton. The woodworking cost was 60 yuan / bit, and now it costs 200 yuan.

Labor costs, financial costs, utilities and other processing costs are related to the actual profits of enterprises, and these costs have been rising, making spinning enterprises more difficult to manage.

In this regard, the Huatai the Great Wall Futures Research Institute commented that this year, foreign enterprises are placing more cautious orders. In the face of a sharp decline in cotton, the survival of large enterprises is acceptable, and many small businesses are facing closure.

High inventory leads to the shortage of disposable capital, and the purchasing of cotton in major textile enterprises is good and bad, and is in the process of industrial pfer.

Answer: diversification of products and dependence on raw materials

In the face of wild cotton and variable market conditions, many textile enterprises adjust their product mix.

Zhejiang Yide Textile Co., Ltd. is an export oriented garment manufacturer, which mainly exports to Europe and Australia.

Ding Xiaohong, manager of the company's business department, said that the company mainly made up of cotton textiles and clothing, accounting for 70% of all products.

After soaring cotton prices last year, the company began to focus on the development of chemical fiber and blended products.

At present, cotton spinning and chemical fiber blending each account for half.

"Try to produce chemical fiber and blended products, reduce the dependence on cotton raw materials."

Ding Xiaohong said that the blended products are made of more than three kinds of materials, which also prevents the product from being tied down by a certain raw material and reduces the risk.

Pan Honghua, manager of Shanghai and Hangzhou area, shsa International Group, said that in the past year, the company has been very well controlled in inventory, and the ups and downs of cotton prices did not cause much impact on the company.