Textile Market Callback Weak, More Violent Decline

Whether in business or in the market, in May.

They all seem particularly sad.

4 at the end of the month, the textile market began to show a pullback due to the influence of many factors.

Phenomenon, and enter the textile market after May

More violent.

Textile market decline

In mid May, the business community issued a half month commodity supply and demand index (BCI). The domestic economy entered the deflation period in May. It is expected that the domestic commodity market will encounter a continuous crisis. It is expected that the situation will not improve significantly in late 5, and the market will continue to be weak.

As expected, after the late May, with the further shrinkage of the economy, the export oriented textile industry further accelerated its weakness and the mainstream products fell to the low level this year.

Before May, the new market began, although the domestic textile market did not appear to be substantially warmer. However, as the enterprises stepped up production at the beginning of the year, the overall trend of the textile market had already shown its advantages, and the prices of mainstream products began to slowly recover.

In a weak and large environment, the textile market began to consolidate the callback. At the beginning, the BCI data have also been shown to be positive enough to illustrate the situation at that time.

However, the market did not last long, and at the beginning of the two quarter there was fatigue.

In late April, this situation became more serious.

Until May, the decline began to become the main theme, and this trend continued to the near future.

Domestic and foreign economy is hard to recover

On the whole, there are several main factors that affect the domestic textile market: first, the industrial chain itself, including upstream raw material output, enterprise operating rate and procurement volume.

The two is the consumer market. Consumption slump years ago led to the traditional textile season did not come, the international consumer market was sluggish, and China's textile exports were mainly in Europe and the United States, so the European and American market situation had a significant impact on it.

The three is the influence of macroeconomic factors.

When the economy shrinks, the international market will also be affected, thereby affecting the bulk market, and then continuing to textile products.

From these factors, it is easy to see that the economic situation in May is enough to explain the main reason for the sharp drop in the textile market.

In addition to the reasons for the product itself, the biggest factor in May is economic factors.

In May 31st, the business community issued a report that BCI rose to -0.71 in May 2012, representing an increase of -4.1%, reflecting a severe contraction in the manufacturing economy compared with April, and the economy continued to decline.

This data coincides with the economic trend predicted in the middle of the month. So it can be seen that the textile market collectively fell into prison in May.

After the market downturn consolidation

For the latter price trend, business analysts give their own views.

Cotton analyst Li Liheng said that cotton prices showed a continuous decline in May, which is closely related to the tightening of the economic situation. The 30 day three spot real estate cotton spot quotation is 18698 yuan / ton, and there is still a downward trend in price. In the market outlook, except for economic factors, the downstream enterprises have higher inventory, slower procurement and weaker domestic sales, and cotton prices are still liable to fall.

Xia Ting, an analyst at PTA, believes that since May, the upstream crude oil prices have continued to fall and the cost of parylene (PX) has been weakened, and the downstream demand has been sluggish, leading to the PTA market's "drop and fall", which has fallen by about 5.20% compared with the beginning of the month, and the current price is hovering at 8200 yuan / ton.

Downstream demand will still determine the medium and long term trend of PTA