Manufacturing Industry'S "Metabolism"? Raw Material Roller Coaster

Since June, more and more enterprises in Zhejiang, Guangdong and other places have complained about the difficulties of survival and business, and even the media have published the words "closing down" in the title of the financial tsunami.

At the same time, there is a consensus that the current corporate dilemma is mainly caused by many kinds of difficulties.

Fluctuations in raw material prices have the greatest impact on enterprises.

Guangdong clothing and Apparel Industry Association conducted a questionnaire survey on the whole industry in Guangdong in mid and late 7.

What is unexpected is that service enterprises believe that the impact of "increase in labor costs" and "fluctuation of raw material prices" on the production and operation of enterprises is much greater than that of "bank loans" or "RMB appreciation".

The roller coaster wave has great impact on enterprises.

Liu Yueping, President of Guangdong apparel and apparel industry association, told reporters that the raw materials for clothing increased by 20% this year. What's more, from May last year to February this year, domestic cotton prices rose from 17 thousand yuan per ton to 35 thousand yuan, and then dropped to 24 thousand yuan in July, with a ten point fluctuation.

"Some enterprises are simply afraid to take orders.

Guangdong is the largest clothing production province in the country, and the garment industry is also one of the main industries in Guangdong.

Affected by cost fluctuations and other factors, the growth of Guangdong's clothing industry has slowed down in the first half of this year.

"At present, the toy industry does have some difficulties, but it is not as serious as the outside world has been."

Liang Zhongming, vice president of the China Toy Association and President of Changping branch of Dongguan Association of foreign investment enterprises, told the Nanfang Daily that the difficulties facing the toy industry are the common difficulties faced by countless foreign small and medium-sized enterprises: rising raw materials, rising labor costs, tightening Yin Hangxin loans and rising RMB exchange rate.

In all the difficulties, Liang Zhongming ranked the first place in the rise of raw materials.

According to his statistics, the cost of raw materials in the toy industry increased by 25% in the first half of this year.

The rise comes from two aspects, one is the rise in the price of raw material supply, and the two is the improvement of toy production standards in Europe and the United States, which makes many enterprises have to replace new equipment to improve the quality of production.

Guangdong economic and Information Commission recently conducted a questionnaire survey on 1000 key enterprises of through train service in Guangdong. It was found that 36% of the enterprises reflected the average purchase price of raw materials increased, which had a greater impact on labor-intensive enterprises, especially small and medium-sized enterprises.

According to the survey, 80% of small and medium enterprises in our province indicated that the total production cost increased year by year, of which 19% reflected an increase of more than 20%.

International prices of means of production are on the rise.

"Only one main raw material has been up to the top from the second half of last year and has risen from thousands to more than 10 thousand!" a reporter asked, engaging in oil for a long time.

The raw material described by Sun Wenlei is one of the main raw materials for waterborne coatings, called titanium dioxide.

80% of the white pigment is titanium white. It is nontoxic and has the best whiteness and brightness. It is considered to be the best white pigment in the world.

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Although experts believe that because of the main cost of coatings in the channel, titanium dioxide accounts for only about 13% of the total cost of coatings, even if the price of titanium dioxide doubles, the coating enterprises can only digest the price by 7%, but "the general practice of the industry is to use substitutes."

Sun Wenlei said frankly, the paint industry did not adopt the way of increasing prices to digest the cost of increase.

Can China's manufacturing industry really avoid titanium dioxide? "Few ordinary people in China know what kind of titanium dioxide is, and what it means for national economic indicators."

Deng Jie, Deputy Secretary General of China Coatings Association Titanium Dioxide Industry Branch reminded reporters.

As a matter of fact, the well-known DuPont Co has always regarded titanium dioxide as its flagship product, which shows its "distinguished status".

The reporter found this chemical noun which is not familiar with the public through search.

It turns out that this chemical material can be widely used in paints, plastics, paper making, printing inks, chemical fibers, rubber, ceramics, cosmetics, food and medicine industries. It is one of the three most valuable products in the world's inorganic chemical products, second only to synthetic ammonia and phosphoric acid.

However, since last year, titanium dioxide has shown a strong performance in venture capital.

Goldman Sachs commodity group forecast that titanium dioxide raw materials, titanium concentrate spot price will increase by 30%-70% during the year.

DuPont, the world's largest titanium dioxide producer, has announced in Vietnam that it will begin to increase the price of titanium dioxide in some international markets in September.

Then, the main manufacturers of titanium dioxide in Japan and North America announced that the price of the product will be raised in October 1st this year.

This is a true portrayal of the existence of many industries like the chemical industry in China.

After the international financial crisis, the inflection point of the international raw material price growth has led to many manufacturers getting caught off guard on many days.

Raw material price rises far exceed product price increase.

The data further prove the pressure from the rising cost of raw material procurement.

"In the first half of this year, Guangdong's producer price index (IPI) increased by 7.5%, 3.7 percentage points higher than the PPI index."

An official in Guangdong told reporters that the price increase of raw materials is far greater than that of finished products, which means that the profits of enterprises are being sharply reduced.

"During the last financial crisis, the impact was basically from overseas orders, which had little impact on us. This wave of costs directly affected the production of enterprises, and domestic enterprises could not be exempted."

Lin Xiyuan, a well-known clothing company, said that the profit margins of many enterprises producing low-grade clothing were being squeezed. The price sensitivity of the medium and low grade products was high. "In the past year, the cloth has increased by 10%, the wage has increased by 20%, and the pportation costs and taxes are also increasing."

"Unlike the financial crisis, the toy industry does not currently have the difficulty of receiving orders."

Xiao Senlin, chairman of Dongguan hitai toy Limited company, told reporters that the problem facing the toy industry is actually that the increase of production cost is beyond the increase of sales price, so many enterprises are unwilling to take orders or dare to take orders.

But the massive weakness in the toy industry has not emerged.

This statement has also been confirmed by Liang Zhongming. Liang Zhongming said that the current situation is fundamentally different from the financial crisis.

"At that time, no one came to buy goods, it is external problems, we can not solve them, and now the problem is internal cost problem, is a problem that can be solved by hard work."

According to the latest statistics of Guangdong Toy Association, the toy export of Guangdong province showed an increasing trend in the first half of 2011.

Liang Zhongming is not frustrated with the industry's difficulties at present.

In his view, the toy industry is always the sunrise industry, "because there will always be children, so there will always be demand for toys."

He believes that the solution to the plight of the toy industry is still pformation and upgrading.

"In fact, the situation is not so bad this time, it has something to do with" muscle "in enterprises.

Liang Zhongming said that after the financial crisis in 2009, many enterprises began pformation and upgrading under the request of the Guangdong provincial government. At the same time, enterprises without pformation and upgrading had at least such awareness. Therefore, in this time of difficulty, many enterprises have certain foundation and preparation, not to suffer heavy setbacks.

Corporate deficit is bound to expand in the second half of this year.

The provincial economic and Information Committee of Guangdong province was analyzed. In the first half of this year, the production cost of enterprises increased steadily. The trend in the second half of this year is expected to continue. At the macro level, we must accelerate pformation and upgrading while maintaining stable economic growth, which is actually forcing the manufacturing industry to "metabolize".

"In short, we should not overestimate the favorable situation in the second half of the year, and we must not underestimate the difficulties and problems."

Attention should be paid to the impact of pillar industries.

The first half data released by Guangdong showed that the total profits of the two industries of Guangdong's electronics and information industry and automobile manufacturing industry decreased by 17.4% and 14.2% respectively compared with the same period last year.

Such a decline has lowered the industrial profits of the province by 2.9 and 1.9 percentage points.

However, the total industrial profits of Guangdong's two main cities, Guangzhou and Shenzhen, declined by 5.7% and 3.3% respectively.

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"We are highly concerned about the economic situation in the second half of the year, Guangdong has done pressure tests, because most of the industrial products in Guangdong are rigid requirements related to food and clothing, so we think it is not possible for the economic situation to be unmanageable."

An official of the Guangdong Provincial Commission of letters told reporters.

Although the production and operation of enterprises is facing great difficulties, the deficit is increasing, but most of the industry profits in the first half of the year are still growing.

"In 1-5 months, the profits of Industrial Enterprises above Designated Size reached 160 billion 440 million yuan, an increase of 7% over the same period last year, an increase of 3.6 percentage points lower than that in 1-4 months, and 28 industries in 37 industrial sectors of the whole province have achieved growth."

Fortune Reviews

A service-oriented government should provide timely help.

The difficulties of this enterprise mainly stem from the superposition effect of various cost growth, the increase of financing cost, the increase of labor cost, the increase of raw material cost and the rise of RMB exchange rate.

No business owners worry about it.

The only drop in many production indicators is profit.

In this regard, enterprises should enhance their sense of hardship, take precautions against the market, and regard market adjustment as a process of "survival of the fittest" and "metabolism" of the industry.

In fact, no enterprise is willing to be eliminated. No business owners are resolutely opposed to pformation and upgrading, and how to deploy the best resources to the most needed and most supportive enterprises, which requires the government to be good at using market mechanism to provide timely assistance, to be good at using the market rules to add flowers, and to be good at using market regulation to choose the best.

This kind of effect is especially prominent in times of danger.

During the crisis, the last time came when the international financial crisis came.

From 2008 to 2009, government officials in the Pearl River Delta came out of the office and were busy running around the factories, or asking questions or investigating.

Guangdong has proved to be right by strengthening the construction of service-oriented government to promote the pformation and upgrading of enterprises.

After fighting against the financial crisis, officials are more aware of the situation of enterprises, and enterprises are more clear about policy direction.

A very small example is that in the early stage of the current business plight, the Guangdong industrial authorities first took out the investigation of the actual operation of the enterprises, mainly based on the 1000 direct train service enterprises in Guangdong.

After the financial crisis in 2009, the Guangdong provincial government selected 1000 key service enterprises to support the steady development of SMEs. They included the key enterprises in the province, the top 500 modern industries, the 100 private enterprises and the 100 largest independent innovation enterprises.

Now, the crisis is on the way again.

Looking forward to the second half of the year, the international economic recovery process is difficult and changeable. The United States is beset by unemployment and debt ceiling problems. The European debt crisis is on the verge of breaking out. In the domestic market, the price increase should not be reduced and the economic growth will fluctuate greatly. The direction of macroeconomic regulation and control policy will not change significantly. The situation of the economic operation in the Pearl River Delta is still complex, and some difficulties may even be compared with the international financial crisis.

What should a service-oriented government do?

At the just concluded Guangdong private enterprise investment conference, the famous private entrepreneurs sit on the rostrum, but the city leaders can only sit on the stage.

The arrangement of entrepreneurs as "top guests" is considered to be a manifestation of Guangdong's "mercantilism" and "Pro business".

In addition to the "Pro business" attitude, we need to do a lot of detailed work. "Mercantile" and "Pro business" need more perfect policies and laws and regulations.

To this end, the Guangdong provincial government issued a number of opinions on strengthening and improving government services to promote pformation and upgrading in the middle of this year, that is, the "No. 59" in the book.

However, enterprises need to be more realistic.

Production costs continue to grow and burden reduction has become a major demand.

Is it possible to conduct a comprehensive regulation and regulation of the administrative and operational charges of enterprises that do not meet the requirements and the actual situation? Can all enterprises' policies and measures be put into place? Are all kinds of irregularities related to enterprises' charges being investigated and dealt with in time?

It is important to pursue a long-term guarantee mechanism for establishing policies. However, in the implementation of policies, the government also needs to pay more attention to the role of market allocation of resources and to manage the market by means of the market.

As the saying goes, "save the poor and save the poor."

Another good way to help quality enterprises tide over difficulties is government guarantee.

During the financial crisis, the largest expenditure of the Hongkong SAR government was HK $100 billion in corporate loan guarantees.

After the release of data, the bad debt rate of 100 billion is less than 1%.

At present, it is certain that in the second half of the year, the state will continue to take stabilizing prices as the primary task of macroeconomic regulation and control. It is necessary to reduce the price increase and not bring about big fluctuations in economic growth. This will enhance the pertinence, flexibility and foresight of specific policies and measures.

How local governments face new challenges together with enterprises is testing the officials of the Pearl River Delta region.