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    In May, Orders Were Slightly Improved.

    2020/5/19 12:13:00 0

    Textile Market

    The yarn market after May 1 is not as bad as it expected. Compared with the totally abandoned "gold three silver four", stable domestic demand orders and a small amount of "broken" foreign trade orders this week bring a ray of hope to the market. As of May 14th, the average price of domestic C32S was 18740 yuan / ton, which fell 35 yuan per ton last week.

       Cotton raw materials, compared with the recent decline in cotton prices, cotton prices have steadily increased. Over the past 5 and June, the raw material inventory of textile enterprises is generally at a high level due to the off-season. This year is different, the lack of downstream orders, coupled with a slight rise in cotton prices in recent days, makes spinning enterprises cautious in purchasing raw materials and keeping them in line with purchase.

       After the May 1, cotton yarn market unexpectedly shipments accelerated, although the volume is still small, but let the textile enterprises have a chance to breathe. It is reported that the main participants in this transaction are traders. The current price of cotton yarn is at a low level, and traders are less stocking in the early stage. In addition, the European and American countries have gradually unsealed the market recently, and speculative sentiment has increased. At present, the stock of spinning enterprises has declined, but the stock of spinning enterprises is still at a high level for nearly three years, and the probability of subsequent rise is still very large. As of 14 days, China's yarn stock index has been closed for 29.3 days. On the boot, due to a slight improvement in the trading atmosphere, there has also been a slight increase in the start-up rate. As of 14, China's yarn load index was 50.1%, but significantly less than 63% in the same period last year.

       Downstream weaving factory, recently, gray cloth pick up part of the local signs of increase, but after investigation, a large number of orders are still mostly traders purchase acquisition of goods. A regular variety of weaving enterprises responsible person said recently, many middlemen often asked for price, and wanted to buy gray cloth in large quantities. They keep the price down, but the raw material has been rising, and the grey cloth has been priced at a price per day. It is impossible to get the same price as before. Some manufacturers not only raise their prices because of rising raw materials but also sell them at low prices. This is mainly because most of the varieties of grey cloth inventory is still high, the market demand for gray cloth has changed little. In the face of such difficulties, price increases are not the key, and inventory is the primary task. Therefore, when the price of raw materials increases and market confidence is restored, it will achieve better inventory effect.

    However, the inventory of weaving mills is not uniform and the differentiation is obvious. There are only 100 thousand meters of grey fabric inventory, not even some, and others in 50 days, or even 60 days. This difference is mainly due to the different source of orders. Enterprises with less inventory of grey fabrics are mostly due to the large number of domestic orders currently being done, which consumed most of the inventory. Enterprises that relied entirely on foreign trade orders were not in demand at that time.

       Imported yarn "Crazy" fell this week, directly back and forth the price difference of nearly 1000 yuan. As of May 14th, the spot price of FCY Index C32S was 18725 yuan / ton, down 728 yuan / ton compared with the same period last week. Among them, the India Analysis Agency reported that although India's domestic cotton prices were very low, it would bring benefits to the cotton mill production. However, the blockade and shut-down of the epidemic will severely frustrate the downstream consumer demand in the next six months. In recent years, India cotton yarn manufacturers are facing a series of difficulties, including export and domestic demand decline, and cotton price fluctuations. Cotton exports have been greatly affected, mainly due to reduced demand in China. Now, India spinning mill has two problems in purchasing domestic cotton. First, liquidity is very tight, and two is India's domestic collapse after the closure of the city in April. In April, India's PMI fell to 7.2, PMI in service industry was 5.4, manufacturing PMI was 27.4, GDP contracted 15.2% in the same month, 122 million people in the country were unemployed, liquidity in all walks of life was sharp, and banks had stopped lending to non bank institutions, resulting in fund companies closing some of the prime money. The recent situation of Pakistan's cotton yarn market is similar to that of India. The production of various domestic industries has gradually relaxed. According to some traders from Pakistan, there have been many defaults from China and other countries. There are very few new orders in the near future, and the early procurement in China has been shipped.

       Recently, Spain, Italy, India and other countries have relaxed all kinds of restrictive measures temporarily, and have opened some enterprises, so some foreign trade orders have also started. Because of the severe epidemic situation abroad, the difficulty of reemployment is greater than that of the domestic market, and the recovery rate is much less than that of the domestic market. After market research, it is learned that most of the foreign trade orders received by textile enterprises come from Russia, Japan, Korea and other countries. However, the situation of exporting to the European Union is still relatively cold. On the one hand, the European Union's lifting of the ban is mainly the Nordic countries, and the demand for Chinese textile clothing is not high; on the other hand, Germany, France, Italy, Spain and other severe epidemic areas are only partial and phased unlocking, taking a step by step to worry about the recurrence of the new crown disease, so the catering industry, clothing and other retail businesses have recovered slowly.

    From the perspective of Sino US trade, imports of clothing and clothing from China in March 2020 were $919 million, down 49.62% from the same month, directly pulling China's position from the first country of origin. Because of the uncertainty of Sino US relations in the second half of 2020, enterprises may have great risks if they continue to "look forward to" placing orders with the United States. From the survey, many spinning and weaving enterprises all regard the "domestic trade" as a compensation means for the outside market. Therefore, it is foreseeable that the domestic market competition in the next quarter will be very fierce.

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