There Is Still A Downward Trend In Textile Industry.

Over the past two years, the international macro news has been volatile, which has brought a certain impact on China's economic market. The environment has increased uncertainty for the textile industry. At the same time, the random switching of good and bad news has weakened the anticipation and made the market gradually desensitized to the relevant information. In the near future, Zheng cotton and Zheng yarn disk maintained a range of shocks, weak trend of decline, but the spot market response is relatively dull, universal feedback: Past results show that this is not an overnight improvement, nor is it worse than expected. As the largest production base of pure cotton yarn in China, the market of Xinjiang yarn market is discussed.

Figure 12019 yarn inventory days in Xinjiang

As shown in Figure 1, as of August 23rd, our yarn inventory in Xinjiang maintained 18.61 days, a decrease of 20.95%. The current value of winter orders to catch up, the downstream customers to pick up speed, sales area concentrated in Guangdong, Jiangsu and Zhejiang provinces. Mainly in the air spinning and combed compact spinning support, the goods are relatively tight, some of the textile enterprises are more compact, the largest volume has been discharged until mid October, resulting in inventory digestion; under the influence of the big environment, the knitting export orders in Guangdong have been sharply reduced, and some orders in Xinjiang have contracted water, resulting in the pressure of some knitting yarn stocks, and spinning enterprises are actively expanding new customers to maintain the subsequent order production.

Fig. 22017-2019 statistical chart of yarn output

In 2019 1-7, China's yarn industry output totaled 18 million 94 thousand tons, a cumulative increase of 2.3%, of which the yarn industry output in July was 2 million 634 thousand tons, down 1.9% from the same period last year, but the ring ratio increased by 7.38%. Judging from the overall trend, cotton yarn output has been declining year by year. Since August, yarn demand has been warmer. It is just now that winter orders need to be replenishment, and some parts of the air textile machines are full. High quality yarn is also more active, and orders are increasing compared with July. However, the macro factor is bad, and the downstream freight rate is slowing down. In the early stage, we intend to take advantage of the winter orders to make up the spinning enterprises that promote the stock consumption to reduce the quoted price. At this stage, the market confidence is not enough, and the quotation is still downward trend, and the "gold nine silver ten" or failed.

Figure 32017-2019 statistics of grey fabric production

Statistics show that in 2019 1-7, China's grey fabric production totaled 31 billion 120 million meters, down -3.3% compared with the same period last year. As can be seen from Figure 3, this year the grey fabric market has experienced a short period of "golden three silver four" and the 5 and June "cold winter" period. In July, the garment factory began to just need to purchase and make winter clothing, and the starting rate of the grey fabric factory increased. This year, after environmental supervision, some printing and dyeing factories ceased notification, and the international and domestic policies were affecting. Most of the textile mills stopped production. The phenomenon of factory shutting down was also increased.

At present, the environment is unstable, the textile industry has a worrying future. The production of yarn enterprises has been reduced compared with the previous years. The production is mainly based on orders, and most of them need to be stocked. Recently, most of the textile products are mostly ordered, while the old customers continue to make the list. According to my understanding of the agricultural product network, the domestic lint supply is loose, the inventory pressure is high, and when the new cotton comes into the market, the contradiction between supply and demand is further intensified. If there is no good news in the short term, it is expected that the textile industry will still have a downward trend in the near future.