Inventory·The most valuable hot spots of the week
This week crude oil, PX, PTA plunged, the RMB exchange rate soared 800 points, Vietnam! Orders are being received slowly, and polyester manufacturers are gradually increasing their maintenance…
Let’s take a look at what’s new this week!
Crude oil, PX, PTA plunge
Last Friday, affected by the unexpected CPI data in the United States, financial markets experienced violent oscillations and international oil prices plunged.
Affected by this, the price of polyester raw materials has dropped to varying degrees.
Driven by international oil prices, polyester raw materials have experienced rapid rises and falls in the short term. This “roller coaster” ride is really exciting. A sudden rise must lead to a sudden fall, which seems to be a fixed law, but I didn’t expect it to happen so quickly.
The editor has something to say: As crude oil is the source of bulk commodities, once it plummets or falls below the limit, it will inevitably be negative for chemical products.
The RMB exchange rate soared 800 points
From 17:30 on June 13 to 4 am on June 14, the value of the offshore RMB against the US dollar dropped from 6.7501 to 6.7848, a range of more than 300 basis points. As of late trading in New York on the 15th, the offshore RMB had risen by more than 800 points against the U.S. dollar, or 1.3%.
Since the end of April, the RMB exchange rate against the US dollar has plummeted, depreciating from 6.36 to the highest point of 6.81. After experiencing a rapid depreciation of more than 4,000 points in a month, foreign capital began to flow in again in May as Shanghai resumed work and production and Sino-US trade relations improved. The RMB stopped depreciating and rebounded, fluctuating around the 6.7 center.
The editor has something to say: For our textile industry, domestic textile companies account for a large proportion of exports, and the depreciation of the RMB is conducive to industry exports.
Vietnam! Reluctant to receive orders
Vietnam’s “Saigon Economic Times” reported on June 6 that clothing orders are pouring in, but some manufacturers are afraid to accept new orders due to insufficient production capacity. The biggest difficulty currently faced by Vietnamese garment companies is the shortage of labor and raw materials.
Export orders from many companies have increased, and the order volume is gradually filling up. Analysts predict that Vietnam’s textile and clothing exports this year are likely to exceed the established target of 42-43 billion US dollars.
According to Vu Duc Giang, chairman of the Vietnam Textile and Apparel Association (Vitas), in the first four months of this year, Vietnam’s textile and apparel exports reached nearly 11 billion US dollars, a year-on-year increase of nearly 21%.
The editor has something to say: The biggest advantage of our competitors in Southeast Asia is labor cost. If labor costs rise in the future due to “difficulty in recruiting workers”, the advantage of low cost will gradually be lost in Vietnam. Then orders may “reflow” to China again
Maintenance of polyester manufacturers is gradually increasing
During the Dragon Boat Festival, a sudden “heat wave” of price increases injected “a touch of warmth” into the early cold polyester market! The rise in polyester prices has indeed had a certain effect on reducing inventory for polyester filament manufacturers; however, it has had little effect on the entire polyester industry chain.
Judging from the current maintenance of the polyester market, starting from this week, polyester manufacturers will gradually increase their maintenance.
The editor has something to say: The cost side is rising, and the worst sufferers are weavers.
Market review
In terms of polyester: In terms of PTA, the price of PTA has plummeted this week. The current mainstream quotation of PTA is around 7200-7300 yuan/ton. Due to the fall in international oil prices, PTA has followed the decline in international crude oil, and coupled with the downward trend in buying sentiment in the downstream weaving industry, it is expected that the PTA market may continue to fluctuate and weaken.
In terms of ethylene glycol, the price of ethylene glycol has gone up this week, and the current mainstream quotation is between 5135-5180. When PTA falls, a large amount of funds enter the ethylene glycol market, driving up the price of ethylene glycol. However, the overall fundamentals of ethylene glycol are weak, so the future trend is relatively bearish.
In terms of polyester filament, due to the sharp drop in costs, polyester filament has followed the decline of raw materials. However, the degree of cash flow losses has increased. In the absence of strong support on the demand side, polyester filament has followed cost fluctuations. Downstream users currently have sufficient raw material stocks and mainly need to replenish supplies, while the production and sales of polyester filament continue to decline.
�The profit margin of PX this week dropped slightly from last week, and its profit currently dropped to US$320/ton. In terms of PTA, the loss dropped this week, and its current loss is around 249 yuan/ton. In terms of ethylene glycol, the loss dropped slightly this week, and the current loss is US$167/ton. In terms of polyester filament, the price of polyester yarn plummeted this week due to the sharp drop in cost. All products have experienced price declines to varying degrees, and profits have increased; the loss of FDY150D has dropped slightly, and the current loss is 201 yuan/ton; the loss of POY 150D has dropped slightly, and the current loss is 197 yuan. / ton; the profit of DTY 150D has increased, and the current profit is 142 yuan / ton.
In terms of operating rate, the average operating rate of PTA was 69.4%, an increase of 2.1% from last week; the real-time operating rate was 70%, and the real-time effective operating rate was 78.4%. In terms of polyester, the average polyester load was 84.5%, down 0.5% from last week. Currently, production costs are relatively high, resulting in weak profits, limited orders, and weak incentives for manufacturers to produce. The recent weaving operation rate is around 66.5%.
In terms of production and sales, crude oil prices continued to fall this week, and manufacturers were short of buying gas after replenishing their positions in the early stage. Polyester production and sales continued to be sluggish. Production and sales average around 30%.
In terms of inventory, according to statistics from Silkdu.com, the overall inventory in the polyester market is now concentrated at 26-29 days; in terms of specific products, POY inventory is around 25-30 days, FDY inventory is around 20-26 days, and DTY Inventory lasts about 24-26 days.
In terms of weaving: It can be seen from the Shengze Index of the Ministry of Commerce that the operating rate of downstream weaving enterprises remains volatile and stable. Currently, production costs are relatively high, resulting in weak profits, limited orders, and weak incentives for manufacturers to produce. Therefore, the operating rate fell back to 66.5%. This week, the market’s order-taking atmosphere has declined, and traders’ enthusiasm for stockpiling has also begun to decline. Therefore, gray fabric inventory has rebounded to about 35 days.
Printing and dyeing: This week, the overall dyeing factory market is in the off-season stage. At present, only some orders for autumn and winter clothing and some orders for foreign trade home textiles that have been stocked in advance have just been placed, and the order volume has shrunk by nearly half compared with last year. The operating rate of most dyeing factories is 50% to 60%, and some manufacturers with good orders can reach an operating rate of 70% to 80%.
At present, most dyeing factories mainly use conventional polyester taffeta, nylon yarn, four-way elastic, imitation memory, and imitation silk, with mixed varieties.
In terms of delivery time, the quantity of gray fabrics entering the warehouse is average, and the general delivery time is about 4-5 days, while some busy manufacturers require more than 7 days.
Outlook
The off-season atmosphere has become more intense this week. Only sporadic small orders have been placed in the market. Fabric prices have been suppressed again and again, and profits are minimal. It is expected that the market will continue to weaken next week. Textile people are ready to meet the challenge!
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