In Early 2020, Good News Continued, And The Textile Market Is Going To "Turn Over" This Year.

On the first day of 2020, good news came from the market:
Central bank: in January 6th dropped 0.5 percentage points, released long-term funds of about about 800000000000 yuan, and increased support for small and micro enterprises and private enterprises.

US President Trump has issued two heavy messages in his Twitter: one involves us Russia relations, one is Sino US trade. Trump said heavy events will take place in January 15th. But this is a major advantage for the global economy. Subsequently, the US stock market went up and down, closing all the way up.

No matter how anxious the textile market left to the textile workers in 2019, the new year's gift in 2020 was a great boost.

One

2019 is too hard! Become the voice of the textile boss. Judging from the operation of the weaving industry in 2019, the current chemical fiber fabrics are in the stock growth cycle. During this time, the demand for downstream garment industry has shrunk, and the capacity of the peripheral areas has shown an upward trend, resulting in the whole industry showing high output, high inventory and low demand.

Then, where will the textile industry go in 2020? Xiaobian thinks that the following questions should be considered:

01

Can terminal demand pull the weaker market?

Many industry sources say that the bad market in 2019 was because their customers' sales also shrank. In fact, this is ultimately attributed to the weakening of terminal consumer demand, and consumers do not pay. Even if the product is better or cheaper, demand pull will be slower. So, is it still true for the macro environment in 2020?

Some experts said that from the current economic environment, policy guidance is the only positive factor. Prior to this, the central economic work conference "to stabilize the main", proposed to mobilize the enthusiasm of all parties and strengthen the counter cyclical regulation, the implementation of a proactive fiscal policy and prudent monetary policy.

From the perspective of "three carriages" of economic growth as a whole, the growth rate of investment in 2020 will be further declined, consumption will rise slightly, and the contribution of net exports will decline. Against this background, the economy will continue to bear pressure, but the pressure will be weaker than in 2019. Textile and clothing are optional consumption. The downturn in the economic sector has led to a surge in the speed of textile and apparel opportunities in 2020. Consumers will still cut clothing spending. That is to say, the demand for short-term textile and garment industry is still uncertain.

02

Where will China US trade friction go?

In the past year, the main export of the world's economy has been declining, and China's textile export trade can not escape this strange circle. At present, there are two reasons for this phenomenon: first, Global trade demand is weakening, and the two is Sino US trade friction.

From the current signal released by the market, these two factors will slow down in 2020. In particular, Sino US trade, in the short term, the recovery of the US manufacturing industry and the political factors of the US election, Trump is slightly friendly to China, and the Sino US trade war has entered the stage of compromise and implementation. This is good!

But in the long run, with the rise of China, Sino US trade friction is likely to exist for a long time. It is also for this reason that many foreign terminal customers choose to place their orders cautiously, changing the long list to short list, and significantly reduce the number of orders, which, to a certain extent, also inhibit the growth of textile demand.

However, as time goes on, the impact of Sino US trade friction on the textile and garment market will be smaller and smaller. That is to say, the impact of Sino US trade friction on the textile and garment market in 2020 will be significantly weakened. Under the circumstances of the tariff already implemented, the peripheral environment will be gradually determined, and exports are expected to usher in positive growth.

03

Nearly 5 million 600 thousand tons of new polyester production capacity will enter the market. Who will pay the bill?

In 2019, the development of textile raw materials industry was more severe. Sino US trade friction, domestic demand slowdown and structural adjustment of downstream textile enterprises all had a profound impact on the trend of raw material market. These factors led to the "surging tide" of the industry, but this did not affect the layout of the polyester industry.

It is estimated that by 2020, nearly 5 million 600 thousand tons of new polyester production capacity will enter the market, which reflects a relatively strong leading effect. In 2019, the top three of the polyester industry accounted for more than 50% of the capacity of the market, and the proportion will increase further in 2020.

In the increasingly fierce market competition, the old production capacity with no cost advantage will gradually withdraw from the market, and the polyester industry will quietly change. The continuous improvement of industrial concentration will be the only way for the polyester industry in the next few years.

Therefore, with the increase of the discourse power of polyester factories, the control of market prices is more "handy". When the market passes through the survival of the fittest, the price of polyester can rebound bottom, but of course, under the current imbalance between supply and demand, the downstream textile enterprises are relatively less speculative, and the enthusiasm of paying the bills is not high, so the polyester price in the first half of 2020 will still linger at the bottom.

04

Peripheral capacity bonus is weakening, can the "rags" crisis be lifted?

In fact, for the textile market in 2019, we have always said that "overcapacity" has caused trouble. The main reason is that many of the production capacity has been transferred to the inland and central and western regions under the rectification of environmental protection, resulting in the rapid expansion of its capacity.

After a year, this year's market makes many textile bosses who build factories outside are in an awkward situation of "small profits and low sales". Some enterprises that can not withstand pressure have begun to withdraw from the market. If there is exit, there will be entry. Of course, the number of textile enterprises that have to be transferred will still increase, which means that the transfer of production capacity is not over.

But fortunately many textile bosses have already suffered the "bitter end". They know that if they continue to produce low value-added products, they may still be a "dead end". Therefore, some enterprises are ready to give up products such as 290T polyester taffeta, 380T nees spinning, 300T spring Asian spinning and so on after the beginning of the year. Therefore, the supply of goods will be reduced next year, which will alleviate the overcapacity of conventional fabrics to a certain extent.

The more we face downward pressure, the more we must find a way out in a broader scope. Although the market still needs to digest the pressure of 2019 in 2020, compared with the four quarter's internal and external environment, some positive news has been released in 2020: the central bank has released the long-term capital of about about 800000000000 yuan and increased its support for small and micro enterprises and private enterprises. The RCEP (Regional comprehensive economic partnership), which is expected to be signed this year, will stimulate the export market of the textile industry.

As the saying goes, there is no market that only falls but does not rise or fall. Although the market in 2019 is too bad, the market for 2020 is still worth looking forward to.