Cotton Prices Slump, Clothing Market Weak Prices Difficult To Fall

From the peak of last year to 34 thousand yuan per ton, up to the current 18 thousand yuan per ton, domestic cotton prices have experienced a tragic dive.

Recently, Qingdao, known as the country's largest cotton import port, has reported a "record of 700 thousand tons of imported cotton", a record high.

This year's continued low cotton prices have raised concerns again.

Reporter visits

Many families

Found that, based on hysteresis, Quanzhou textile enterprises have yet to feel the good news of price cuts, but textile enterprises generally reflect the news that "this year the market is weak as a whole".

Besides,

The supply has exceeded the demand of enterprises, and some cotton mills have made preparations for the production of "pressing the spindle".

[cause]

Hot money to raise cotton prices

According to media reports, the country's largest cotton import port -

In Huangdao port, the stacks of cotton are becoming the hot potato of traders: they sold a ton of 22 thousand and 100 yuan two months ago, but now they only have 18 thousand yuan a ton.

The price of these cotton reached a peak of 34 thousand yuan last year.

Even worse, even though the price has been cut more than half, the cotton is still not sold.

In April, the port of Huangdao, Qingdao, had less than 300 thousand tons of cotton, but now it has more than doubled to 700 thousand tons.

Until now, many garment enterprises in Shishi still remember the cotton prices soaring last year.

Last year, cotton prices sat on the roller coaster and went through two waves of skyrocketing and plummeting.

After reaching 34 thousand yuan / ton in March last year, spot prices fell rapidly to 24 thousand yuan / ton in recent two months, and nearly 30%.

"30 thousand yuan per ton is supposed to be high."

Cotton industry analysts believe that a large number of hot money into speculation is pushing hands.

Domestic demand has been maintained at around 8 million tons, plus the volume of imports, which is much larger than demand.

In the downstream terminal market, the international consumer market has been sluggish, and the output of cotton textile products has shrunk considerably compared with previous years. The weak market demand has also reduced cotton prices to a certain extent.

"In fact, cotton production in Xinjiang and other major cotton producing areas has been slightly reduced this year, but prices have fallen so far."

Wang Ronghua, deputy general manager of Fujian Sanhe textile trading company, believes that artificial speculation has always been a major backstage driver of cotton plummeting.

Terminal clothing market is weak

although

Relieved the cost pressure of Quanzhou textile and garment enterprises, but reporters interviewed several garment enterprises in Shishi, but they did not feel that they were relaxed.

"This year, clothing manufacturers' overall fabric orders have dropped by 30%~40% over the past year, even if they are brand companies."

Zhang Weimin, the head of the clothing company of Shishi, a large textile group, said that the signal in the terminal market was pmitted through layers, the order of cloth shops was reduced, the demand for cotton yarn was reduced, and the demand for cotton was lower. Now it can be said that the supply exceeds demand.

"The fundamental reason for the fall in cotton prices is the weak market demand."

Wang Ronghua believes that their business volume is flat this year, but many small and medium-sized clothing enterprises have no orders.

Even if cotton prices drop a lot, they do not need it.

[influence]

Benefit from small and medium enterprises and foreign trade enterprises

Reporters in Shishi several garment enterprises interview, did not receive the cotton price drop brought good news.

"The impact of the decline in cotton prices has a lag period, and no price information from suppliers has yet been felt."

Zhang Weimin said that their enterprises are located in Changting, and some local cotton mills have begun to "stop production" or "press the output" and turn to the outdoor functional fabric market.

Wang Ronghua told reporters that the fabric 30%~60% needed cotton and consumed about 1 million square meters of cotton cloth a month, but they bought it from a cotton mill and did not buy cotton directly. At present, the price of cotton yarn quoted in the cotton mill is 36 thousand yuan / ton, and the price has not changed much.

In addition, the impact of the fall in cotton prices is mainly the small and medium-sized enterprises that rely on the "price advantage" to survive.

In fact, for many garment enterprises with regulatory models, with the increase of labor costs and research costs, the cost reduction of these cotton prices is far from enough.

{page_break}

Shishi, a foreign trade distributor, told reporters that even at the peak of last year, the price of foreign cotton was also several thousand yuan lower than that of the domestic market.

The cost of using cotton in domestic textile enterprises is higher than that of foreign textile enterprises, while the price of export textile products keeps the same price as foreign products. The huge cost difference between cotton and cotton has weakened the international competitiveness of export commodities, and many foreign trade clothing and textile enterprises suffer from it.

And this round of cotton price cuts can at least release more profit margins on cost, and have more advantages when negotiating with customers.

Clothing prices hard to fall

Like last year's big ups and downs, cotton prices for raw materials fell this year, but clothing prices in the terminal market have not been reduced.

Mr. Chen, a boss of Shishi knitted fabric shop, analyzed that taking a garment as an example, the proportion of raw materials in cost is decreasing, and the proportion of labor cost has increased from 15% to 30%, and the proportion of energy cost has increased from 10% to 15%.

"For those clothes that cost hundreds of thousands of dollars, the fluctuation of cotton prices will not have much impact."

Wang Ronghua believes that, especially in the high-end brand enterprises, the raw material volatility has less impact on them because of the higher value-added products.

In addition, the demand for cotton fabrics for clothing has also changed to varying degrees.

According to the analysis of the industry, the clothing material has been greatly improved than in the past. 100% of the pure cotton clothes on the market are rare. Most of the garments are made of nylon, spandex, hemp and various fibers as raw materials.

In addition, rising labor costs and high cost of sales channels are also one of the reasons for pushing up the price of clothing.

Related links

Cotton enterprises go bankrupt and go abroad to sell cotton products for sale.

According to CCTV reports, when interviewed by reporters, cotton traders said that the economic crisis in 2008 was like a storm, and this economic downturn was more like "warm boiled frog". Not only did cotton merchants fail to see the rebound of cotton prices, but also cotton enterprises were hopeless.

Reporters in Binzhou, Shandong, known as "the first cotton in the country", saw many cotton mills struggling, and some even closed down.

Cotton prices are falling, and raw materials in cotton mills are cheaper. Why is it hard to manage? Look at the reporter's investigation.

Binzhou, known as the "capital of China's cotton", is more than 400 kilometers away from Qingdao port, but the cotton sales in the port are directly controlled by the amount of cotton used here. The cotton yarn exports accounted for 1/4 of the country's total exports.

Reporters saw here that many brands of textile mills are still there, but the business has gone out of doors.

The reporter saw that almost all the doors were locked in the huge yard of the cotton mill, and the locks had been rusted.

The refrigerator outside the wall has also been rusted.

In the workshop, the spinning machine remained intact, and the batten on it was dusty.

Local people told reporters that the textile mill has been shut down for more than a year, and plant equipment is waiting to be processed.

And not far away, the reporter saw that another textile mill, although the brand is still there, has changed its name to its owner.

According to the survey, there are about ten cotton mills on this street in Binzhou, and three or four of them are closed down.

Local people told reporters that in the past, enterprises could not find workers, and now workers could not find them.

In the survey, the reporters saw that some enterprises, even if they could afford them, were trying to find a way out.

This enterprise is to bite the tooth spend about 20000000 yuan to change the direction of equipment adjustment, the former product fifty percent is export, now all turn to domestic sales.

At the same time, the imported cotton should be bought and used.