After the beginning of the new year, upstream raw material manufacturers and downstream polyester factories have started a continuous game. In just over a week, they have gone through 3 rounds.
Round1, during the Spring Festival holiday, thanks to the liberalization of public health policies, consumer industries such as tourism and the film industry delivered a beautiful report card, and the market responded to2023China’s economy also has relatively good expectations for 2020. Even though the orders have not yet been placed, there is momentum for price increases, and raw materials have also risen first, hoping to encourage newly opened weaving companies to replenish their stocks.
Round2, faced with rising prices of raw materials, weaving companies are unmoved at all and will not buy them if they say they won’t. The upstream crude oil did not give any face, falling nearly 8% in a week, and polyester factories could only trade sideways at high levels.
Round3, crude oil prices rebounded, and raw material prices began to fluctuate again, but weaving companies still seemed to have no intention of buying silk.
The game between upstream polyester and downstream weaving has a long history and continues to evolve with market changes.
In the beginning, the procurement of textile companies followed production. After the new year, textile companies concentrated on production, which led to an unspoken rule that the price of polyester yarn increased at the beginning of the new year;
Afterwards, some textile companies found a pattern and did not buy silk after the holiday, but before the holiday, and bought several months’ worth at once;
The situation continued until 2019. 19 After the beginning of the year, polyester prices plummeted, and textile companies that stocked up on yarn in advance A large loss occurred in raw materials;
2020, 2021, 2022 years, due to the chain reaction caused by the epidemic, many Textile companies have returned to mechanical procurement of raw materials;
But because many textile companies encountered serious inventory problems in 22, they were afraid that they would encounter the same problem in 23. If we simply delay the start of work, there will be no need to rush to buy raw materials.
Only up, not down
If the situation in 2022 is followed, after a long period of sluggish production and sales, polyester factories will launch price reduction promotions to stimulate sales, but the current situation is obviously different. On the one hand, the 2022 polyester factory’s promotional efforts will be in November when the inventory pressure of the polyester factory It’s very big, and it’s not certain whether there will be any orders in the next period of time. However, this year has just begun, and the inventory of polyester factories is not high, so there is no pressure to destock. As long as textile companies want to start operations in the future, raw materials will be in urgent demand. If you don’t buy them now, you will definitely have to buy them in the future. Therefore, “sit tight on Diaoyutai” “There is absolutely no thought of price reduction.
In addition, landlords have no more food left. 2022 Most of the financial reports of polyester giants have declined compared with previous years, and there is a certain pressure on profitability. At this time Naturally, we won’t lower prices when we can.
This leads to a result: the price of polyester yarn in the next period of time will only increase, not decrease.
Purchase on demand, be wary of skyrocketing prices
A cautious buying strategy will also lead to a consequence, that is, once demand comes, there will be a short-term mismatch between market supply and demand, resulting in tight liquidity. In human terms, the raw materials will be snapped up.
People have a herd mentality. Now everyone has a tacit understanding not to buy. But when people around you start to buy raw materials, you will be easily led. When the price of raw materials increases, it will easily cause I ended up buying expensive ingredients. Last year’s December increase in raw materials was largely due to this situation. Firstly, the polyester factories needed to recover their blood, and secondly, textile companies began to “…”Active” consumption.
Such price increases are likely to repeat themselves in the coming period. If textile companies really have a strong need for raw materials, they need to formulate favorable procurement strategies according to their own needs.
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