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    Market Sluggish Procurement Downturn, Cotton Yarn Traders Pressure Mountain, Overflow To Close Three Factory Refracted Cotton Textile Enterprises Dilemma

    2020/5/9 10:33:00 0

    Textile And Garment Market

    Since late March, orders for foreign orders have been lifted and orders have been delayed. Domestic textile enterprises are facing second pressure to stop production and reduce production. At the same time, the market is cold and the downstream purchasing is low, so that the spinning enterprises are not optimistic about the second quarter or even the whole year's operation. It can be said that the current yarn market has not yet fully recovered, and it is still some time for enterprises to get out of the "cold winter".

    Market sluggish procurement downturn, cotton yarn traders pressure mountain

    Recently, the yarn market has become more and more deserted, and orders are less than in March. In the Foshan market of Guangdong, according to an enterprise, the 26 yarn and 40 yarn that had better shipped in February and March tended to be dull with the gradual completion of the previous orders. In the Shengze market of Jiangsu, besides the demand of C32S and JC40S, which are mainly used for jet cotton and cotton series, the trading of other varieties is light, the market of pure cotton yarn continues to be weak, the downstream purchasing is low, and combed varieties are obviously inferior to other varieties.

    Due to the large number of foreign trade orders being cancelled, many foreign trade enterprises are turning to domestic sales, and domestic orders are extremely competitive. There are spinning enterprises that, in order to rush orders, substantial price cuts, most manufacturers cut prices to 1000 yuan / ton ~2000 yuan / ton. Even so, most textile enterprises say it is difficult to get orders, raw materials purchase is also bought with orders, dare not hoard goods, and some enterprises with large stocks of raw materials say that the losses are serious. The current cotton mill and downstream cloth shops mainly focus on clearing inventory and selling goods, the shipping mentality is thicker, there are no new orders in the downstream, and the cost of labor, plant, raw materials and other costs leads to enterprises. In addition, they are eager to ship back the funds and sell again and again. The market price war is getting worse and worse, resulting in a vicious circle in the market.

    Some textile mills simply limit production, shift or holiday to ease operating pressure.

    The sale of imported yarn is also not optimistic. Ningbo, Qingdao, Shanghai and other places of cotton yarn trade enterprises reflect not only the immediate cotton yarn inquiry and shipment continue to be light, but also the "futures yarn" that has just begun to improve in the early April, which has not been sold, especially in Vietnam, Pakistan, Thailand and other producing areas, the demand for OE yarn and 8S~16S siro spinning is getting weaker and weaker.

    An import company in Zhejiang said that at present, apart from a small number of medium mix, high C21S~32S, package, bleaching and self welding, Vietnam, India, Pakistan and Uzbekistan have made inquiries and shipments, and others including JC20S~32S, OE yarn and high count compact spinning have become "hot potato".

    In the first ten days of March, the company began to take part in some parts of India, Pakistan and Uzbekistan yarn contracts, such as breach of contract, cancelling the contract through negotiation, postponed shipment, and so on. From the survey, although the arrival of India cotton yarn has declined in 3~4 months, China's port cotton yarn inventory has continued to rise, and some cotton yarn traders are under pressure.

    Cut costs and streamline personnel, and Ida group closes 3 plants.

    It is understood that the new orders for textiles and clothing are seriously inadequate, and the original orders have been cancelled or delayed. The textile industry, especially small and medium-sized textile enterprises, generally has the following difficulties:

    One is the lack of demand. From the domestic perspective, the retail sales of clothing, shoes and hats and needle textiles in the domestic market fell by 31% over the same period 1~2. Internationally, since March, a large number of export orders have been delayed or cancelled, and new orders have also been decreasing significantly. According to the latest survey results of more than 100 key enterprises in China Cotton Textile Industry Association, the proportion of enterprises with insufficient orders is 63.6%.

    Two, the pressure of steady employment in the industry is increasing. The pressure of order reduction is being carried out along the industrial chain to the upstream, which will have an impact on the normal operation of the textile industry chain, and the employment situation in the industry is becoming grim.

    Three, enterprises reflect financial constraints. With the decline of orders and the withdrawal of orders, the inventory of raw materials and finished products of textile enterprises is increasing, which is facing enormous pressure on inventory and the amount of capital is also increasing.

    Therefore, the contradiction between capital and production is becoming more and more prominent. In order to reduce expenditure, enterprises can only be forced to reduce production and limit production in order to reduce orders and accumulate products.

    Many spinning enterprises say that the pressure of business operation has been increasing since late April. According to the development of foreign epidemic situation, it is estimated that the external demand from April to May will drop to a low point, and the test will be even more brutal. In view of the grim situation of the market, many spinning enterprises have to cut costs, control costs and even cut down some production capacity in order to maintain their business. Even the Yida group, one of the world's leading producers of pure cotton shirts, is cutting operating expenses.

    Recently, Yida group announced on its official website that it decided to close 3 factories in advance by the end of July. Yida group said that the global spread of the epidemic has made the supply chain enterprises of the global textile and garment industry experience a storm, and we are under tremendous pressure. Some enterprises are even struggling to survive. In order to control the spread of the epidemic, many countries have forced shops to close, and economic activities are close to a standstill, and the retail industry has almost stagnated. The above measures also brought unprecedented impact on the Yida group, which is upstream of the textile and garment supply chain.

    In order to ensure the sustainable operation of Yida, the Yida group has taken a series of actions, including adjusting the scale of the business, slashing operating expenses and streamlining personnel. It decided to close the following factories at the end of July this year: closing the factories in Fenghua in April 30, 2020, and closing the two factories in Malaysia and Penang in June 12, 2020, 2020 7 On October 31, the factory in Flach, Mauritius, was closed.

    Yida group admits that in the coming months, the company will make every effort to ensure that all affected employees receive an appropriate and fair transitional arrangement.

    It is understood that the Yida group produces more than 100 million garments for world famous brands, such as Ralph Lauren, Tommy Hilfiger and Nike every year, and has 57000 employees worldwide. Its main production base is located in China, Malaysia, maurejus, Sri Lanka and Vietnam, and has sales offices all over the world. Due to the influence of garment orders, the factory has switched to masks. Zhang Yunxiang, general manager of the garment factory of Guangdong Yida Textile Co., Ltd., said that 80% of the workers in the garment factory had stopped making clothes and were processing masks urgently. Due to the development of the global epidemic, orders for garments have to be postponed and postponed. The factory's highest capacity can produce 700 thousand ~80 masks a day, and orders for about 10000000 masks have been received.

    Some experts said that the textile and garment market environment is relatively low. In the main consumer market of clothing, Japan, Korea, Europe and the United States all spread epidemic situation. Local consumers' clothing demand may be affected by the epidemic in the short term, and the behavior of European or American clothing brand cancelled or postponed orders directly affects the production rhythm of related enterprises in the industry chain. It is also expected that the company will have to close its factories this time. In recent years, cutting expenditure and maintaining production are the primary objectives of textile enterprises.

    Under the epidemic situation, the healthy consumption enters the public life.

    Although the epidemic poses many challenges to the production and operation of China's textile enterprises, there are still some textile enterprises that are flexibly responsive and have a new mode of online sale, such as Ruyi cowboy. According to the relevant responsible person of Ruyi group, Ruyi cowboy set up the "good pants" WeChat mall when it adapted to local conditions and actively adapted to the new situation. The mall included super soft super bullet dress, double shot commercial men's wear and other popular products sold at cost price. Ruyi cowboy tries to explore and create a new order of economic operation under normal epidemic prevention and control, so as to stimulate the vitality and creativity of enterprises, and thus go to the comprehensive normalization and order of production. Shandong yarn enterprises are promoting local yarns through the online platform, speeding up the flow of information, realizing information sharing, and promoting accurate docking between upstream and downstream industries, production, supply and marketing.

    From the perspective of consumption trends, experts say that under the stimulation of the epidemic, functional products with high quality and advanced concepts such as environmental protection concept, antibacterial concept, energy concept, skin friendly concept, warm concept and soft concept are more easily favored by consumers. This is also the focus of attention of terminal brands and enterprises in the industrial chain.

    From the perspective of enterprises, we should pay more attention to three points in future development.

    First, insist on making products with distinctive characteristics and cost-effective products, and create their own core competitiveness.

    The two is to vigorously develop online sales channels.

    At present, the development of online sales is better, but the problem of supply chain docking and information asymmetry is also prominent. Customers generally require delivery within 15 days, and no reason to return for 7 days is a test for the production enterprise. How to link the traditional industrial chain with the electricity supplier well and increase the symmetry of data information is the direction that enterprises should consider in the later stage.

    Three, the demand for functional products and large health products is getting bigger and bigger. This is also a category that enterprises should pay close attention to.

    In the face of pessimism from export enterprises, experts believe that the cancellation of orders is only temporary. The outbreak of India and some Southeast Asian countries, and European and American brand spinning orders will flow back to China. The extension of India's sealing state to May 3rd will bring about a large scale stoppage of production and the closure of major ports in the cotton mills, cloth factories and garment factories. The capacity of landing and the delivery capacity will drop off, and the epidemic situation of Pakistan, Bangladesh and other textile giants is also not optimistic. Therefore, once the international demand starts, buyers or retailers from Europe and the United States will choose China.

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