Today is the end of May, and the market conditions have visibly faded. Recently, textile workers are facing greater pressure than during the peak season. In the days when orders are reduced, textile companies have to face price cuts from customers, and the profits of textile companies can be imagined.
The reason why the off-season is called off-season is that the most obvious feeling is the decrease in order volume. I remember that at the beginning of May, we did a survey on whether there would be a holiday during the May Day holiday.
Faced with this problem at that time, textile people were relatively calm. Many companies said that there were too many orders and they had to work overtime during the holidays to ship the goods in time.
Decrease in orders
In just 2 weeks, the market has undergone earth-shaking changes. A boss who specializes in cotton spinning said: “Orders have dropped significantly now, by about 20%. There are no good products on the market.”
Another boss who specializes in high-elastic pongee also said: “The market is very bad now. All that can be sold are conventional products, and the inventory is much higher.”
Foreign trade is weak
The current market orders are mainly rigid orders. Several bosses interviewed are engaged in foreign trade. Judging from their reports, the placement of new foreign trade orders is still very weak, and the overall order volume is not very large.
And now weaving companies are generally facing the pressure of high inventory. Starting today, summer has officially entered Jiangsu and Zhejiang. With the arrival of high-temperature weather and the difficulty in improving orders, some companies have expressed expectations for holidays.
peer involution
Fewer orders means a smaller pie. As we all know, the current textile market is in a state where the pie is not divided enough. The polarization is extremely serious. Fabric prices are either driven down by customers or driven down by peers.
Involution among peers is inevitable, and we are now in an era of overcapacity. Needless to say, regular products, even some newly developed products have even joined the off-the-shelf track.
Customers lower prices
In this basically open and transparent market, the involution will naturally reach the ears of end customers. For textile companies, the cake is small, but for customers, they have more choices.
A weaving boss who specializes in foreign trade orders said: “In the past two days, foreigners have come to lower prices again. In the past six months, it used to be very comfortable to do business with foreigners. As long as the quality is good, the price is high, but it doesn’t matter anymore.”
In the current weak global economy, everyone will pay attention to procurement costs. Just like when weaving companies purchase raw materials, they basically replenish their positions on days when polyester factories are stationed for promotions.
Less profit
But if the market is good, who has time to cover positions? As long as the market improves and there is not enough raw materials, the frequency of purchasing raw materials will naturally increase.
But now customers are lowering prices, and peers are collapsing. Fabric prices are easy to fall but hard to rise, and profits are significantly compressed. In this case, you can only improve your profits by finding the right purchase time and reducing the cost of raw materials.
Some companies said: “From the beginning of the year to now, the profits squeezed out by customers’ price reductions have been nearly 1 million.” Another company also said: “I earn some processing fees for the work that customers ask me to do.” ”
How is the market outlook?
Regarding the future market situation, the bosses basically have the same view – the market will be even weaker. Now is just the beginning of the off-season. It can still be supported by some orders from the end of April and some orders from the 618 Shopping Festival. The market will be even worse in June and July.
In particular, foreign trade has been very sluggish since the beginning of the year. Whether we can make further progress will only be known in the second half of the year.
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