June is coming to an end, which also means that half of 2021 is about to end. This year, the domestic epidemic has ended and the world has been vaccinated. Textile people thought that the market would be lively and prosperous in the first half of the year, but unexpectedly, it always gave people a feeling that the peak season was about to end before it arrived. Especially as the market has gradually entered the off-season recently, this lack of orders has become even more obvious.
Orders have dropped significantly, and the market is generally not as good as last year
“We mainly make outdoor fabrics. There is a release paper factory with a total trade volume of RMB 80 million last year. It cannot do it this year. So far, it is obvious that there are fewer orders.”
“Our company’s main business is corduroy. The market is not good and the sales volume is definitely higher than last year. A lot less.”
“Our company mainly produces elastic fabrics, but also other fabrics. This year’s orders are not as good as last year, with an overall decrease of about 20%.”
Unexpectedly, this year the domestic epidemic has been controlled, the economy has fully recovered, and vaccines have been widely vaccinated around the world. , the textile market is actually not as good as last year, which seems completely contrary to last year’s market forecast for this year. Of course, most of the textile companies where this happens are foreign trade companies, and their customers and orders mainly come from overseas markets.
Orders did not increase but fell. On the one hand, this is because although Europe, the United States, Southeast Asia and other regions are receiving vaccinations, the epidemic is still raging, and the severity is even far greater than last year. This has also led to the continued closure of cities, work stoppages, and market shutdowns in these countries and regions. On the other hand, the impact of the epidemic has a certain lag. Last year, the epidemic broke out late in Europe and the United States, and there were differences in the attention of their governments. However, the impact of the epidemic this year has begun to fully appear, and domestic textile orders have begun to take a hit.
Fewer samples, more inventory, but no production reduction plan
Reduced orders are of great concern to most It is quite difficult for weaving companies because most of the looms have to keep running even if there are no orders. According to market visits, the current operating rate of many weaving companies is around 70% or 80%. This operating rate is not the result of their own production reduction, but because they can only operate so much due to environmental protection and production restrictions. And they have not further reduced their operating rates due to the current reduction in orders. Some weaving mills that are not within the production limit have even maintained their full operating status.
Such a high startup rate in the off-season, This inevitably means that inventories are getting higher and higher. According to the person in charge of a weaving factory, “Currently there are about 5 million meters of inventory in the factory, and there is no sign of reduction in the short term.” Another weaving company also expressed the same feeling, “Currently there are three to four hundred meters in the factory. The inventory of 10,000 meters is more than the previous period. In addition, there will be more production in June, and orders will decrease in July. It is estimated that the inventory will continue to grow.”
Weaving enterprises Not only are there no orders to stop production now, but most of them have no plans to stop production in the future. Many weaving companies said that due to environmental protection and production restrictions, their operating rates have been low, and there is no need to lower the operating rates later. In addition, they are more confident about the autumn and winter market in the second half of the year. Research companies generally say that the market will be good in September and October.
Optimistic about the price increase of raw materials, some textile companies have begun to hoard
In addition to maintaining confidence in the market In addition to the high startup rate, another important manifestation is that in the face of price reductions and promotions for raw materials, they no longer simply wait and see, but start to sell, buy, and hoard raw materials.
“We will buy raw materials when prices are reduced, but not much. If they are cheaper, we will stock up on them.”
“We will buy them now when the price is reduced, and later on There is a high probability that raw materials will still rise. After all, international oil prices have risen a lot now.”
“As long as the prices of raw materials are reduced and promoted, I will buy some. They will definitely rise in the future, which is still optimistic.”
Polyester filament has basically maintained weekly price reductions since April. Frequency, as the number of promotions increases, weaving companies are generally more cautious about purchasing raw materials. Most of them buy and use them as they go, and do not specifically buy them during price reduction promotions. But starting from the end of June, many manufacturers began to actively express their intention to purchase and even stockpile raw materials, uncharacteristically.
One of the reasons is that the current international oil price is already hovering around US$75/barrel, and is expected to rise to US$80/barrel or even US$100 in the future. /barrel, it is only a matter of time before raw material prices rise. On the other hand, the most important reason is that autumn and winter fabrics are now selling well, and market confidence is high in the second half of the year, so fabric demand will gradually reach its peak.
This year, because the overseas epidemic has not fully recovered, domestic foreign trade exports have been affected. To a certain extent, the trade volume of many textile companies is not as good as last year when the epidemic was raging around the world. However, with the large-scale use of global vaccines in the second half of this year and the gradual lifting of travel restrictions in various countries, the market may have great prospects. Stock up on raw materials and maintain high startup The rate…Many textile companies have already taken notice of this trend.
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