The European energy crisis and inflation have hit Europe’s economy and consumption. Since February this year, the EU’s economic sentiment index and consumer confidence index have been declining sharply. So far, the consumer confidence index has even fallen to the lowest value in nearly 36 years!
The economic downturn coupled with low consumer confidence has caused ordinary European consumers to invest their money in more necessary consumer goods. The global economy is still shrouded in a sluggish atmosphere, which will also have a great impact on the apparel industry. Especially in the fourth quarter, the market is gradually declining. Under the influence of economic downturn and declining consumption power, it may drag down the original textile market.
01
Weaving operation rate is declining rapidly
Mr. Guo, who mainly sells Shumei Silk, revealed: “Currently, the factory’s operating rate is 80%. After the October peak season, we plan to reduce production. We are expected to have a holiday after New Year’s Day.”
At present, the factory’s operating rate is 60-70%. Production has been reduced in mid-September, and the annual holiday is expected to be in mid-December. Mr. Wu, who produces pongee and polyester taffeta, said.
Manager Guo, the person in charge of a pongee manufacturer, said that although the factory is currently running at 100% capacity and there are no plans to reduce production in the future, the annual holiday will definitely be brought forward, probably at the end of December.
The weaving operation rate can directly reflect the current state of the market. When the market is good, every textile company would like to increase the operation rate to 200%, and there is no time to ship goods. However, now weaving manufacturers have a strong wait-and-see attitude, and the weaving operation rate has ended in the peak season. declined later. When the market weakens, shipments of gray fabrics are slow, and inventories continue to rise, manufacturers’ enthusiasm for production becomes worse.
According to data monitoring from Silkdu.com, the current weaving operation rate in Shengze is 65.3%, which has dropped slightly from last week. As for the entire Jiangsu and Zhejiang textile cluster, the operating rate has also declined, with the average operating rate at 58%.
02
Market order volume dropped by more than 30% year-on-year
This week is during the Double Eleven Shopping Festival, and it has entered mid-November. For textile people, the market situation is basically over. Generally speaking, the market situation has picked up slightly compared with the first half of the year, but it is still not as good as in previous years. Very good, weaving manufacturers are in a wait-and-see mood, and the weaving start-up rate has never been able to increase significantly. At present, the overall market orders have undergone major changes compared with previous years. Even though the peak season is coming, large orders still rarely appear. The terminal clothing industry has a conservative attitude and is more cautious in placing orders. Orders are often placed in batches. Therefore, many companies Mainly to maintain inventory.
Mr. Guo, who mainly sells Shumei silk, said: “The current order volume is almost 70% of the same period last year; the orders are mainly Shumei silk; there are many domestic trade orders, but they are all small orders.”
The current orders are about 70% of last year’s, mainly for pongee, polyester taffeta, and T8, but the volume is not large, and the Christmas season will not be good either. Manager Guo, the person in charge of the pongee manufacturer, said.
03
Raw material prices are low, but procurement is still cautious
Following the negative decline in polyester filament yarn prices in early November, prices reached the lowest level of the year, causing subtle changes in the market. The production and sales of polyester factories have also changed and received a slight boost. Some downstream weaving factories have also carried out a wave of stocking up, but more manufacturers are still purchasing cautiously and adopting a buy-and-use strategy.
Manager Guo, the person in charge of the pongee manufacturer, told the editor: “I don’t dare to stock up too much. Now that there is a lot of inventory, I will suffer a lot of losses. I don’t dare to stock up at all now.”
Nowadays, raw materials are bought and used as needed, and there is no stocking up. I feel that polyester yarn may continue to fall. Mr. Wu, who produces pongee and polyester taffeta, said.
Editorial
Against the background of the bad market conditions, companies are obviously seeking stability and are unwilling to do risky and radical things. Focus more on products, delve deeper in your own field, and do better. Or mainly focus on continuous efforts to develop products to ensure that order profits will not be affected. Regarding the market outlook, companies said that the epidemic has been repeated this year, domestic sales are saturated, and foreign trade orders are few, making it difficult to boost the market. If the market is good, the machine will keep running. If the market is not good, production will be reduced, and even in the off-season of the fourth quarter, the company will take an early holiday.
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