In the past two days, the editor went to the company of a textile boss to have tea. The boss mysteriously said that he had copied it to the end. After asking, he found out that it was 380T nylon yarn. The production cost of their own factory was 3.5 yuan/meter. The factory can buy it to lower the price to 2.8 yuan/meter. It is more expensive to produce it yourself.
Although nylon fabrics, as autumn and winter fabrics, may not sell well in the current off-season, the price is now sold below the cost. This is not just an issue of the off-season. There are three factors that have led to the current “outdatedness” of Nisi spinning.
Inventory overflow
First of all, there is the old-talking problem of overcapacity. This year and last year can be said to be an extreme contrast. Let’s start with last year. There were many manufacturers of nylon fabrics in Fujian, but the epidemic hit Fujian last year. This As a result, manufacturers in Fujian had to stop production and rest. During this period, it happened to be the traditional peak season for autumn and winter fabrics, the Golden Nine and Silver Ten. This resulted in the supply of nylon spinning capacity exceeding demand, and the price suddenly went up.
Looking back on this year, due to the lack of orders in the first half of the year, most weaving manufacturers mainly relied on production inventory. Now that we are in the off-season, the inventory will only accumulate more and more, and we can only sell at a reduced price. I thought the boss of the weaving manufacturer said: “I am 3.01 yuan If I don’t sell it per meter, others will sell it to customers for 2.8 yuan per meter, so I can only bite the bullet and sell it.” According to data monitoring from China Silk City Network, the current weaving inventory in Jiangsu and Zhejiang is 34.5 days old.
The off-season is very light
Secondly, let’s compare the market situation with last year. Although everyone shouted that the market was not good last year, at least the orders were seen. The peak season may not be strong, but the off-season will also happen from time to time. For example, nylon fabrics fell in the first half of the year. Orders have already been placed and a large part of the orders for the second half of the year have been overdrawn. However, this has not happened this year. The peak season is not busy and the off-season is very weak.
The weaving start-up rate reflects this situation well. In the first half of previous years, the weaving start-up rate in Jiangsu and Zhejiang was generally above 80% in March and April. However, this year the weaving start-up rate in Jiangsu and Zhejiang has been tepid since March. The fire level remains at about 60-70%, and the operation of these machines is only producing inventory. The weaving boss complained: “This machine will cost maintenance even if it is not running. It is better to keep the production point running and keep inventory.” This can only explain the current situation. The overall environment is indeed unsatisfactory, and the terminal clothing store is very cautious when placing orders. Now that June has arrived, the signs of the traditional off-season in the textile market are becoming more and more obvious. Although the epidemic situation in the domestic market has improved, the lack of market orders has become more and more serious due to the advent of the off-season. The foreign trade market is facing difficulties in shipping, high freight and order transfers. It is also difficult to make a breakthrough under the trend in Southeast Asia, so textile companies in the market are mostly bearish on the market outlook.
Profit compression has become commonplace this year. This is the biggest problem faced by textile workers now. They have orders but lose money. Weaving companies are like a “sandwich” sandwiched between upstream and downstream and are under pressure. The upstream continues to increase prices, and the downstream has no demand. Today, the market situation in the first half of the year can basically be said to have come to an end, and we still have to wait for the recovery of market conditions.
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