After entering September, the polyester raw material market suddenly became popular! International oil prices have been playing a triumphant song, PTA has surged strongly in response, ethylene glycol has also risen rapidly, and polyester filament has grown by leaps and bounds… In just ten days, a series of performances on the upstream cost side have made textile companies call it “exciting”!
Now that the polyester raw material market is “busy”, what is the situation like in the downstream textile market? And it’s already the middle of the “Golden Nine” period. Have both the foreign trade market and domestic sales orders improved?
It’s not clear yet, orders are seriously polarized
The traditional peak season of “Golden Nine and Silver Ten” has always been a critical juncture for the textile industry. Whether this wave of market conditions arrives will be directly related to whether textile companies can end the year smoothly.
Judging from the current situation, the peak season performance of the polyester raw material market is relatively obvious. Affected by the sharp rise in international oil prices, the polyester industry chain has experienced a wave of price increases. Although this round of market prices occurred during the “Golden Nine” period, this wave of gains was basically driven by the cost side, and the role of the demand side was minimal.
Compared with the excitement of the raw material market, the textile market appears to be quite “calm”. Through research, we found that the textile market is currently recovering slightly, but the later trend is not yet clear. In terms of orders, the polarization among enterprises is becoming increasingly serious, and there is a feeling that “droughts will die and floods will die”.
Mr. Cai, who specializes in finishing processes:
“Currently, our order intake is good, and the total order volume has reached the level of last year. In terms of startup, the factory’s startup rate is 80%, which has increased compared with August.”
Mr. Tang, who specializes in elastic fabrics:
“Since September, the factory’s operating rate has steadily picked up and currently remains at around 90%. As for taking orders, although the situation has improved, it is still a little worse than last year.”
Mr. Peng, who specializes in tent fabrics:
“We are a trading company and our products are relatively single. After entering September, the order situation was not optimistic, and the order volume decreased by about 50% compared with last year.”
If the textile market was dull in July and August, the current market performance does bring hope to textile companies. It cannot be denied that there is still a certain gap between this year’s market and previous years. Relevant people analyzed that not granting permission for foreign trade orders is the original sin!
Fabrics are selling well in some areas, but profits are not as good as before
Although the order performance is not as good as expected, it does not prevent the emergence of hot-selling fabrics.
As early as August, there was some partial sales in the fabric market. Fabrics such as 300T pongee, 100D four-way elastic, and 228 Taslon are all selling well to varying degrees. Even some substitutes are sold out, and the quotations of some fabrics have also increased accordingly.
Monitoring data from Silkdu.com shows that since August, the weaving companies in the sample have achieved significant destocking results. Most of the best-selling fabrics on the market are autumn and winter fabrics, which are seasonal products. As for the reason for the hot sales, it is generally believed that it is driven by the demand for autumn and winter clothing. But hot sales don’t mean big profits. After all, the profits of textile companies have long been sluggish.
Mr. Jiang, who specializes in four-sided bombing:
“Nowadays, some autumn and winter fabrics are selling relatively well. For example, four-way elastic has good sales. However, most of the orders are based on running volume, the order size is small, and the profit is also very average.”
Mr. Tang, who specializes in elastic fabrics:
“T400, 75D high-elasticity, and four-sided elastic are all very popular. They are all seasonal products. Unfortunately, the order profit is very low, around 5%.”
Mr. Peng, who specializes in tent fabrics:
“Our orders are mainly for Oxford cloth, and the volume of orders is very average. This year, customers are less likely to get expensive goods, so the profit is not high.”
Against the background of overcapacity, the price war in the textile industry has intensified. Negotiations often turn to “price”, and a large loss of profits has become a “worry” for textile companies. At this time, once the price of raw materials increases, the already meager profits will be even worse.
With high-priced raw materials, shrinking profits and extended billing periods, the capital chain of textile companies is facing multiple tests. As a result, they were forced to be cautious, purchasing raw materials on demand, and carefully budgeting for stocking, and even hot-selling varieties did not dare to follow the trend easily.
Textile bosses have different opinions on the traditional peak season. Some are optimistic and are confident that orders are performing well; some are unclear and believe that the foreign trade market is too calm; others are not optimistic and feel that terminal demand has not recovered and the inventory of downstream garment companies is high, which will affect orders issued.
Taken together, whether it is genuine demand or genuine stocking up, orders have at least really come in during this period. Among them, domestic sales orders have picked up significantly, while the performance of the foreign trade market has been mediocre. As for whether the subsequent textile market can become active on a large scale, it will take time to verify!</p
