Cotton Prices Rise Pressure To Reduce Inventory Of Raw Materials

In June 11th, in order to further understand the production, order and inventory quantity of textile enterprises, China cotton net reporter went to Shangqiu textile enterprise of Henan province to carry on the investigation.

A person in charge of a visiting company told reporters that at present, Henan has a highly indebted textile enterprise, and its production and operation are not optimistic. It is understood that due to the severe market foreign trade environment, some enterprises have a heavy problem of stock inventory of Combed Yarns, and the inventory of individual enterprises backlog is about 700 tons. To avoid a continuous increase in losses, the large combed yarn production enterprises choose to wait and see, and sell combed cotton yarn when the market improves.

In addition, a company said that it began to resume work in February 21st this year, and its production has returned to normal, with a 100% operating rate and a smaller scale of cotton yarn. Reporters learned in the workshop that the workers in the enterprise use three class production system, and the machine runs 24 hours. The head of the company said that because of the unstable cotton prices, the stock of raw materials was relatively small, and the cotton inventory was three months ago. At present, the stock of cotton is only 40-50 days, and the stock of cotton yarn is only about 10 days. The basic choice is to replenishment or purchase cotton according to the order demand. The reporter understands that the combed yarn produced by the company is mainly used for the enterprise's own use, and the combed yarn produced is mainly used for external sales. At present, the price of the high 40s cotton combed yarn is 20000 yuan / ton, and the profit is relatively low.

Enterprises believe that cotton prices will rise in the long run, but for the short term concerns about Sino US economic and trade relations and foreign epidemic control and control, the current cotton price rise is still under great pressure.