How much is left in 2020? one third! For textile people who have experienced the “most off-season in history” for more than half a month, the recent market style is a bit “elusive”, but there is no doubt that the textile market is partially recovering!
Raw material end: The early period was negative and smooth, and the pressure on polyester factories was delayed!
In the last week of July, the raw material market has also performed well. In addition to the slight price increase, production and sales are the best proof. The average production and sales of mainstream manufacturers increased from 40% to 50% in the early period to 60% to 80%, and even exceeded 100% at the end of the month. The inventory pressure of polyester manufacturers once again Transfer to downstream production enterprises.
Monitoring data from China Silk City Network shows that as of July 31, the overall polyester market Inventory is concentrated at 30-39 days; in terms of specific products, POY inventory is around 10-15 days, FDY inventory is around 21-28 days, and DTY inventory is around 29-39 days.
According to an industry source, some major manufacturers have stated that they may reduce discounts in the future. Even the promotion was cancelled, which to a certain extent also led to the mentality of bargain hunting in the downstream market. Since entering the off-season, downstream weaving manufacturers have been cautious about purchasing raw materials and dare not put funds into raw materials at will. Moreover, there are not many raw materials purchased in the early stage, which has led to this wave of market conditions.
Whether it is the stimulus of the polyester manufacturers’ “conspiracy” or the weaving manufacturers’ own urgent needs, this wave of purchases has indeed relieved the polyester manufacturers who originally had high inventories! “The early negative impact of polyester manufacturers should be smoothed out, and the next wave of pressure on polyester factories may be postponed to the fourth quarter.” A professional said.
Trade side: Both domestic and foreign trade orders have been placed, and the performance of elastic fabrics is eye-catching
Late July , the textile market broke the shackles of the “off-season”, and good news came out of the market for a time. Many textile bosses said: “This wave of market conditions caught us off guard, and we finally got some goods!”
According to monitoring data from the China Silk City Network, the transaction atmosphere in the Jiangsu and Zhejiang markets has been relatively strong recently. Things improved in the early stage, with most transactions concentrated in autumn and winter fabrics. Both the domestic trade and foreign trade markets performed well, especially the domestic trade market.
“From the time after the Dragon Boat Festival to last week, the market was really slow. Sometimes I would sit in the sales department for an entire afternoon and there would not be a single call to purchase gray fabrics,” said Mr. Shen, who uses elastic fabrics on all sides, said, “But this week is a completely different scene. I now receive various calls early in the morning to ask for gray fabrics. 20,000 meters here and 50,000 meters there. Recently, in the warehouse, The inventory has been reduced, and some orders have to be made to order and need to be queued up.”
In addition to better stretch performance, orders for other regular autumn and winter fabrics are also better than in the previous period. , such as Shumei silk, gallbladder, etc. used for lining, warp knitted suede, velvet, etc. used for sofa fabrics. In addition, medium-thick clothing fabrics also have certain performance, especially after special finishing processes. It is used to make down jackets, cotton jackets and other fabrics, and performs well in market proofing and testing.
It can be seen that the market has indeed released positive signals. Whether it is the price increase of raw materials or the placement of autumn and winter orders, at least the social inventory that has been rising steadily in the early stage has been stabilized. During the editor’s visit and research, most weaving manufacturers have begun to slow down the increase in gray fabric inventories or their production and sales have been able to level off. The inventories of a few manufacturers that produce marketable products have even dropped slightly, which has also boosted the confidence of market participants.
Overcapacity is still “stuck”, and there are still concerns about the overall recovery of the textile market
Regarding this wave of market conditions, a few textile bosses believe that the market situation is ahead of schedule, and I don’t know whether it is good or bad!
According to traditional practice, June and July are the traditional off-season for textiles, and phenomena such as load reduction and inventory accumulation are also common in the market.
What is different this year from previous years is that some companies have experienced a state of “low demand and high load” in the second quarter. Their own inventories have reached a high level in recent years, and they are under financial pressure. Larger, so in mid-June, the market has accelerated holiday operations. The main cluster load in Jiangsu and Zhejiang has been hovering around 60%, and the lower one is around 40%.
In the face of the current market situation, companies that have received good orders have begun to operate at full production, and companies that have received average orders have also postponed their holiday plans, which is the market situation in August and September. Make preparations, resulting in a slight increase in the market’s operating load.
According to the monitoring data of China Silk City Network, the operation of water-jet looms has recently rebounded to about 70%, the operation of warp knitting is at 70-80%, and the performance of circular knitting machines is slightly worse. It is about 40%, which is an increase of 4 percentage points compared with last week. Compared with the same period last year, the difference is not big.
It can be seen that this wave of market conditions has driven the enthusiasm of manufacturers for production. If the market outlook continues to improve, then the market inventory will slowly decline. If this wave of market conditions is only short-lived, it is likely to intensify the August crisis. Overcapacity.
After all, today’s general environment is still deeply affected by the epidemic, and the textile industry is still facing the dilemma of slow recovery of end consumption, especially the weak foreign trade market, and the poor economy has led to foreign unemployment and The number of bankrupt companies is still rising. It can be said that the impact of the development of overseas epidemics on the economy and even the textile industry has not diminished over time. If the epidemic recurs in the autumn, foreign trade economic activities will easily be “suspended” again. “.
Looking back at China, after the “Two Sessions”, a new development strategy began to appear in everyone’s minds In the field of vision, it is – “It is necessary to gradually form a new development pattern with the domestic cycle as the main body and the domestic and international dual cycles reinforcing each other.” It can be seen that China’s economic structure will undergo a new round of major changes, with a huge consumer volume of 1.4 billion The domestic trade market of groups is frequently mentioned, which is beneficial to the textile industry.
“At present, the volume and requirements of domestic first-tier brands for fabric procurement have actually exceeded foreign orders. This year, we have done relatively well in receiving orders in the domestic trade market. This is not because It has decreased due to the epidemic, so I think the domestic trade market still has great potential!” said Mr. Zhao, a textile trader.
Taken together, today’s textile market is standing at a crossroads. Whether the market will get better to the left or weaken to the right cannot be predicted. In the current situation where bulls and bears coexist, , Textile companies also need to reasonably arrange the status of funds and inventory based on their own order situations.
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