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    The Uncertainty Of Sino US Trade Is The Worst Year For Textile Industry This Year.

    2019/8/13 12:29:00 4

    Textile Industry

    After entering the traditional off-season in June, the textile industry has never failed to live up to the "off-season" title. The price, benefit and order contrast of grey fabrics have been seen as "visible to the naked eye" in the past two years. The loom starts to drop to the lowest point after the Spring Festival, and it seems that the momentum continues to decline.

    "This year is the worst year" has become the voice of almost the majority of the textile industry.

      

    High inventory and low demand

    The 6-8 month is the traditional off-season for textile industry. The order of weaving and adding bombs is remarkable. The price of PTA and raw material polyester is fluctuating and the price of fabric is not up. There is a rapid inventory of storehouses after a short period of inventory.

    On the whole, factors such as Sino US trade uncertainty, grey cloth efficiency decline, high temperature and bad weather, sluggish single cash flow, poor cash flow and high gray cloth inventory have led to a continuous decline in downstream looms.

           

    By the end of 7, there were 42.5 days in the Jiangsu and Zhejiang comprehensive billet storage, and 27.5 days at the end of July 2018, and 32.5 days at the end of July 2017. The data showed that the inventory of grey fabrics in July 2019 was much higher than that in the past two years.

    The high inventory of grey fabric is directly related to the difficulty of capital turnover, plus the overall profit margin this year, and the long time owing to the shortage of grey cloth. Many thin cloth enterprises are facing great pressure. Based on this pressure, many small factories have ceased production.

    Excess capacity, fewer monks and fewer meat

    In 2017, the wind of environmental protection started to lift the looms from the coastal areas of Jiangsu and Zhejiang to the inland areas of the central and western regions. As of July 2019, there were more than 120000 loom looms in Jiangsu and Zhejiang provinces, and Jiangsu, Northern Jiangsu, Anhui, Henan, Hubei and Jiangxi became new textile clusters.

    At present, the production capacity of loom loom is approaching 40000 in the large province of Anhui province. The capacity of loom loom in Hubei province has reached about 23000 units, and the capacity of loom loom in Jiangxi province will reach about 60000 units. In the past two years, the newly developed loom loom in Northern Jiangsu, Anhui, Hubei and Jiangxi has exceeded 200 thousand units, far exceeding the number of loom looms eliminated by traditional textile clusters in the Yangtze River Delta region.

           

    In the periphery of the loom production capacity to migrate and add, the original Jiangsu and Zhejiang provinces are also "unwilling to be lonely". In recent years, the continuous good market has led enterprises to over introduce production equipment, and the productivity of warp knitting machines in Haining, Zhejiang has increased by nearly 20%. The new capacity has been flooding inside and outside, and the downstream weaving enterprises have changed from last year's supply shortage to overcapacity, and the textile industry's poor prosperity, and the low demand for upstream polyester, leading to the high inventory of the downstream fabric, which has become the normal market.

    On the whole, at present, under the primary pressure of loom overcapacity, the relationship between the terminal garment industry slump and Sino US trade tensions in 2019 has become the last straw to crush the textile industry.

    How to survive the cold winter

    1, strictly control inventory and reduce the risk of falling prices. We should know that now the excess capacity, the lower order is getting smaller and smaller. It is not the time to do the scale, and the main raw material is not overstock or overcapacity, so there is no need to catch up and sell down. There is no need to make a pile of stock and occupy funds.

    2, increase development efforts, actively marketing the market. At present, although the textile industry has excess capacity inventory, the textile industry is not without demand. With the rise of the country's comprehensive national strength, the domestic demand of the whole country is also slowly rising. Therefore, we must increase the development efforts and track the trend of the market so as to avoid being eliminated.

    3, increase inventory handling and increase cash reserves. Old and old inventory, the processing will be handled, and the use of value of inventory, increase marketing efforts, quick cash, strict control of equipment duplication of investment, saving and increasing cash reserves.

          

    No one can accurately predict the market in the second half of the year, but overcapacity is a certainty. The market itself also has the function of self regulation. It is still a while before we reach the balance between supply and demand.

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