Before the National Day, good news came out of the market. Due to the severe epidemic situation in India, smooth delivery could not be guaranteed. A large number of Indian textile orders were transferred to China. The order volume is huge. It is said that it has been scheduled until May next year!
Affected by the epidemic this year, domestic and foreign consumers The demand for clothing has declined, but the performance of home textile fabrics has been very strong, especially in September. A home textile boss said: “Before the National Day, we received orders for hundreds of thousands of meters of home textiles, which were eventually exported to Europe and the United States. According to It is rumored that production in India may have been transferred to us, but the RMB exchange rate has surged recently, and our final profits may have been wiped out by the exchange rate.”
The RMB exchange rate has soared. Boss Bu is in a dilemma. Should he raise the price?
On the first trading day after the holiday, as expected, the onshore RMB exchange rate rose nearly 1,000 points against the US dollar; but more importantly, the offshore RMB exchange rate The U.S. dollar exchange rate continued its strength since the holidays. It once rose above the 6.7 mark during the session on October 9, setting a new high since April last year. On October 12, the central bank lowered the foreign exchange risk reserve ratio for forward foreign exchange sales business from 20% to 0. By adjusting the foreign exchange risk reserve ratio, it will be lowered when the exchange rate appreciates and raised when the exchange rate depreciates, which can have a negative impact on the exchange rate. The regulating effect of the cycle.
On October 15, the onshore RMB exchange rate against the US dollar opened up 70 points to 6.7300. At the same time, the offshore RMB against the US dollar rose above the 6.71 mark.
Starting in early June this year, the RMB has experienced a rapid The appreciation trend is due to China’s better control of the epidemic and the appreciation of the renminbi. This is good for import companies, but it is not a good thing for bosses in the export business. Generally speaking, foreign trade companies mostly settle foreign exchange in U.S. dollars. If the exchange rate of RMB against the U.S. dollar during foreign exchange settlement drops, it means that the profits from the originally negotiated price have decreased.
The rise and fall of the exchange rate has always been a pain in the hearts of textile foreign traders. If the time of settlement of foreign exchange is grasped well, it is possible to make a fortune, but if it is not grasped well, a sum may be lost in vain. A trader Boss Bu from foreign trade said: “Many export companies have received orders until the end of the year or even next year, and the prices have been locked. If you do this now, it will probably be in vain!” Coincidentally, another friend who is engaged in foreign trade also said Expressing that he had had a similar experience, he said that at the beginning of 2018, the RMB appreciated rapidly. The exchange rate of RMB against the US dollar was still 6.88 one day, but fell to 6.78 the next day. Just because the foreign exchange settlement was one day late, tens of thousands of RMB were “thrown away” .
Now, for the cloth boss who has just received a large number of foreign trade orders, he is in a dilemma. Should he increase the price at this time?
On the one hand, if customers do not accept the price increase, they are likely to move to other suppliers who have not increased prices. The current price war is very fierce, and many companies have reduced orders due to the impact of the epidemic. Everyone wants to grab these “scarce” orders to make up for the losses in the first half of the year. On the other hand, the price of raw materials has started to rise recently, and the exchange rate is still on the trend of rising. If the price does not increase, then this part of the meager profit will also be eaten up by the increase in the exchange rate and the price of raw materials. In the end, it will probably be in vain!
The market situation has improved, raw materials have increased significantly, and suppliers’ bargaining power has begun to increase
However, during the National Day, the market suddenly became hot, benefiting from the cold winter With the boost of Double Eleven, there has been a chaotic scene of “fabric grabbing” in the market. Some dyeing factories have also experienced liquidation, and dyeing fees have also begun to increase. Currently, the entire industry chain is in a state of rising. At this time, downstream suppliers have enough voice to ask customers for price increases.
Nowadays, gray fabrics for home textiles and clothing All have increased. Even the most conventional gray fabrics such as polyester taffeta and pongee have been very popular recently. Many manufacturers said that orders have been scheduled until next month. The market has improved and raw materials, such as polyester filament, cotton yarn, polyester shorts, Viscose and other products are increasing in price, so fabric prices have also started to rise.
But many cloth bosses said that this is just a normal price adjustment, mainly because the previous price drop was too severe. , taking advantage of the good market now, if you lower the price a little, customers will agree. “Between usThe price of 240T pongee in China has dropped to 1.4 yuan/meter, and recently returned to 2 yuan/meter. But it cannot be said to be a price increase. 2 yuan/meter is the normal price of this piece of cloth. “The manager of a weaving factory that makes pongee fabrics said. In addition, a manufacturer that makes cotton fabrics also revealed: “The price of cotton yarn is very high now, and the supply of fabrics is also in short supply, so we decided to increase the price of 60s and 50s colored fabrics by 0.5% based on the existing price. Yuan/meter, 40s color cloth increased by 0.4 Yuan/meter. ”
Postscript
The market has improved recently, and many cloth bosses have received related orders. Whether it is home textiles or clothing orders, there has been an increase. Many cloth bosses are working hard and want to Take advantage of this period to take more orders and try to make up for the first half of the year. Indeed, many bosses have been soft on orders recently.
But at this time, Mr. Bu needs to stay sober. On the one hand, overseas epidemic data are still rising, and many countries have adopted another blockade policy. This part of the returning foreign trade orders is likely to face the risk of being canceled again. During this period, do not blindly produce or overdo it. Stocking up. In the first half of the year, due to misjudgment of the future situation, manufacturers’ inventories were getting higher and higher, and the lessons of cash flow difficulties are still vivid in our minds. On the other hand, customers should leave a certain amount of leeway when quoting, and beware of changes in the exchange rate. If the price rises, there will be little profit left.</p
