Yarn Price Reduction Tide, Textile Market To Inventory Pressure Increases

Recently, the undercurrent of textile market is surging, the business risk is increasing, and the business status and market mentality of each subject have changed. The raw materials can be purchased as soon as they are used, and the products are actively de stocked. Although enterprises support the price, but under the pressure of mountains, enterprises gradually lose their pricing power. ?

Market downturn, enterprises difficult to order. Due to the escalation of the Sino US trade war and the mutual tariff increase between the two countries, domestic textile export orders are blocked and the demand is weakening. The overall production and sales talks of the supply chain are discussed. According to the introduction of enterprises in Shandong, Jiangsu and other places, since May, yarn orders have declined significantly. Although enterprises have been reducing their quotations slightly, the market mentality is still pessimistic and the goods are moving slowly. At present, enterprises are faced with a dilemma: continue production, increase inventory pressure; stop and wait, the loss is greater. Enterprise management is like walking on thin ice, in a dilemma.

Raw materials fluctuate greatly, and they are mainly used and purchased. Recently, zhengmian has been in a continuous decline limit, with the low point falling to 13370 yuan / ton; this week, the reserve cotton round sales bottom price is 13893 yuan / ton (standard price), down 579 yuan / ton compared with the previous week. Xinjiang cotton spot down nearly 1000 yuan / ton. Most enterprises dare not store cotton raw materials. According to reports, after the Spring Festival, most textile enterprises' raw material inventory has been maintained at a low level. The raw material inventory of large factories is maintained at 20-30 days, while that of small factories is only 10-12 days. Although enterprises are thirsty for cotton, they are reluctant to do so. Entering this week, textile enterprises mainly bid for reserve cotton, and other cotton resources have reduced procurement.

The yarn market is in turmoil. In the near future, the domestic yarn has been steadily falling. As of May 23, the quoted price of 40 yarns in Binzhou area of Shandong Province was 25000 yuan / ton, which was 300 yuan / ton lower than that on May 20. The quotation of 32 pieces of ring spun yarn in Weifang, Shandong Province, was 22100 yuan / ton, a big drop of 400 yuan / ton compared with that on May 20. Yarns in other regions also fell slightly to varying degrees. At the same time, polyester yarn, cotton yarn prices also fell slightly. As of May 23, the price of 32S polyester yarn from a factory in Shijiazhuang, Hebei Province, was 14300 yuan / ton (ex factory tax included). Compared with May 20, the price dropped by 200 yuan / ton. The sales volume was fair, and large orders could be negotiated according to the volume. A factory in Weifang, Shandong Province, offered 15200 yuan / ton of 32S cotton yarn (including tax). Compared with May 20, the price dropped by 200 yuan / ton, and there was a slight discount in the volume.

Due to the stagnation of yarn sales and the sharp decline of raw material costs, textile mills have plans to reduce prices to attract orders. A person in charge of an enterprise in Foshan, Guangdong said that the impact of Sino US trade friction on the cotton textile industry chain was far greater than the industry insiders had predicted. At present, Foshan market is full of cotton yarn sellers. Textile enterprises basically send all sales personnel to the first-line market, which shows the difficulty of sales. At present, the yarn market is faltering, the reason why the wave of price reduction has not yet arrived is that the raw material price of the early procurement is high, and the high-cost yarn is still struggling to support.

The downstream does not give force, outer yarn impact, domestic yarn inventory difficulty increases. According to industry analysis, even if the recent trend of yarn price reduction, the pressure to inventory is still great. On the one hand, the weak gray fabric consumption and insufficient orders led to the low operating rate of enterprises; on the other hand, in May, China's main port yarn inventory reached a record high, and the bonded area and logistics zone were "full of yarn", and traders were eager to ship and realize their cash.

Therefore, during the period from May to June, domestic textile enterprises may still face many difficulties. Although we dare not get the order, the cost of yarn is still hard to get. Enterprises generally hope that the trade situation will improve, and hope that the G20 China US summit will bring good news.