In April, the domestic commodity market was in a miserable state. Although PTA had the dual benefits of rising crude oil and released demand, it was still not immune to the disaster, and MEG fell miserably. The polyester filament market was also affected by the downturn in the raw material market, and finally experienced a general decline for as many as 10 days in the second half of April.
In contrast to the chemical fiber raw material market, texturing companies acted “a little willfully” after May Day and ignored the deep decline of polyester raw materials. Many well-known texturing companies issued multiple price increase orders and insisted on increasing prices. Get out of a wave of “your own rising market”.
Why do texturing manufacturers issue price increases at a time when the market for polyester raw materials is declining? What are the reasons for this?
According to direct feedback data from the price increase notice, many texturing companies have been affected by the sharp increase in raw materials, plastic pipes, freight, silicone oil and other auxiliary materials and labor wages in recent times, which has led to price increases due to increased production costs.
Take POY, the direct raw material of texturing companies, as an example. Since the end of last year, the price has risen from early 6,000 to 9,000 yuan in half a year. Although it has fallen back now, it still maintains a high level of more than 8,000 yuan, and the increase is more than 30% compared with the previous period. .
In addition, in addition to the production of raw materials, the texturing industry involves many other raw and auxiliary materials. It is understood that, taking the texturing industry as an example, since the third quarter of last year, due to the sharp increase in the prices of various auxiliary materials, product processing costs have increased by 100-150 RMB. Yuan/ton, the processing fee for each product increases by 10-20%, not counting the increase in transportation costs.
“Price increases are not new, but in the past the amplitude was generally within 10%, which is a normal price increase.” An industry insider once told the author that raw material price increases are normal, but this time the overall increase data is astonishing. Asked about the direct impact on product costs, a texturing company CEO said: “The cost is basically close to the ex-factory price.”
It is understood that in fact, since the fourth quarter of 2016, the price increase has been fierce, and the WeChat Moments of textile people have been flooded by the price increase. The large-scale price increases of raw and auxiliary materials such as carton packaging materials and freight costs have made chemical fiber people worried. Now entering the second quarter, although the situation has improved compared to the end of last year, as profits continue to erode, the texturing companies that have been on the verge of losing money for a long time seem to be increasingly unable to hold on!
Actually, for textile companies such as Textile Textiles, the issue that is pinching their “throats” now is not just “rising raw materials”!
1. Environmental protection improvements in Jiangsu and Zhejiang are no longer groundless
Since the beginning of this year, environmental protection rectification in Jiangsu and Zhejiang has been intensifying. The third batch of environmental protection inspections has been launched, Wujiang’s “263” operation, and Jiaxing’s elimination of 10,000 water-jet looms… Environmental protection rectification is just around the corner, and it is no longer groundless.
This environmental trend is particularly violent, and it seems unlikely that environmental regulations will be relaxed in the future. Environmental protection rectification will accelerate the speed of industry reshuffle, and will also make the “transformation and upgrading” that has been mentioned more urgent. The situation of small and medium-sized textile enterprises will become increasingly difficult. On the one hand, there are rising costs, difficulty in financing, and heavy pressure on environmental protection. On the other hand, the battle for the market will become more intense. The polarized development trend of “the strong are stronger and the weak are weaker” has become inevitable. The innovative research and development, capital and other transformation and upgrading capabilities of large enterprises have left small and medium-sized enterprises beyond the reach of small and medium-sized traditional textile enterprises. Life is becoming increasingly difficult for small and medium-sized traditional textile enterprises.
2. The state strictly investigates tax evasion and will fine you bankrupt in three installments of the golden tax
When I first entered the industry, I heard the saying, “In the textile industry, all you earn is tax money!” But now there is a problem. After the third phase of the Golden Tax went online, it can be seen from the recently disclosed list of illegal textile companies that no matter from Neither the intensity of supervision nor the intensity of punishment can be said to be “ruthless”, the punishment will make you bankrupt in minutes!
With the passing of the traditional peak textile season of gold, three, silver and four, the downstream demand of textile enterprises is expected to decrease, and the market may once again enter a period of downward adjustment. Nowadays, the texturing industry is not very prosperous, and the increase in the price of raw materials and auxiliary materials has put pressure on people in the industry. It is easy to imagine that companies are forced to increase prices, and people have to sigh that it is difficult to do business! What the author wants to say is that the price increase of raw and auxiliary materials has become a fact and will be difficult to change in the short term. How to stay afloat and even discover opportunities amidst the noise of “rising” is a problem we need to overcome together.
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