Power restrictions in various places are gradually ending
On November 7, the State Grid Co., Ltd. issued a document stating that phased results have been achieved in ensuring power supply, and the safe and stable operation of the power grid has returned to normal. Through the joint efforts of all parties, the scale of orderly electricity consumption has been significantly reduced. As of November 6, except for some provinces and certain periods of time that have adopted orderly power consumption measures for high-energy-consuming and high-polluting enterprises, the scale of orderly power consumption in the entire network is close to zero. This also means that the nationwide power rationing situation since September has basically ended! On November 8, the relevant person in charge of the National Energy Administration said: The ability to ensure power supply has gradually increased, the tense situation of national power supply and demand has been eased, and power cuts have no longer occurred. According to the actual power supply and demand situation in Zhejiang Province, it has been decided after research that Zhejiang Province will suspend the implementation of orderly power consumption starting from November 8.
“Power rationing” ends, raw material prices fall
The “power rationing” has ended in stages, but from the perspective of the raw material market, the market has fallen more obviously than before the easing of the power rationing. In particular, viscose staple fiber has experienced the largest decline. From November 5 to November On the 12th, it fell by 500 yuan/ton, while polyester staple fiber fell by 130 yuan/ton during the same period.
The surge in the U.S. dollar has suppressed oil price valuations, and short-term prices will remain volatile and weak. The supply of polyester staple fiber is expected to increase in the near future, while terminal orders are generally average for the time being, which has limited support for the market; but in the short term, the strong rise in international oil prices will form a strong support for costs, and the bottom support for polyester staple fiber prices is strong. In the future, in the short term Affected by the fall in prices of upstream raw materials, the price of polyester staple fiber may still fluctuate weakly.
Recently, the trading atmosphere of viscose staple fiber continues to be weak, and the downward pressure on prices is greater. The quotations of mainstream manufacturers have not changed yet. Some manufacturers are bearish on the market outlook and have lowered prices to boost sales. On November 12, the domestic ex-factory price of 1.2D*38mm viscose staple fiber was 14,000 yuan/ton, which was 500 yuan/ton lower than last week’s price.
Recently, the operating rate of viscose staple fiber has increased, the supply is expected to increase, coupled with the sluggish downstream demand, the trading atmosphere has turned weak, and the viscose staple fiber inventory of downstream spinning mills is acceptable. The procurement demand for viscose staple fiber is not urgent yet. It is expected that the short-term viscose staple fiber market will have greater downward pressure.
As the price of raw materials drops, the quotations of downstream products are also lowered. With the mentality of buying up rather than buying down, terminal trading is average. The trading atmosphere of downstream rayon yarn has weakened, terminal demand has been weak, and the industry’s operating rate has increased rapidly, causing prices to fall. As of November 10, 2021, the average ex-factory price of rayon yarn (30S, ring spinning, first-class product) is 19,166 yuan/ton, which is about 100 yuan/ton lower than last week’s price.
The upstream polyester staple fiber market fluctuated weakly, and the pure polyester yarn market transaction speed was slow. As of November 5, the average price of pure polyester yarn in Shandong was 14,725 yuan/ton, the same as last week. .
Unit: yuan/ton
This week, the yarn market The overall trading is poor, prices fluctuate and consolidate, downstream purchases are maintained for rigid needs, and textile companies are gradually under pressure. At present, the production and sales of yarn mills are at a very low level, mainly issuing early orders, and low-priced goods in the trade link are relatively good. Due to the chaotic market prices, downstream companies are also cautiously waiting and watching. At present, the transaction volume of high-count carded/combed yarns of 40S and above is still unsatisfactory. Traders in the light textile market in Jiangsu, Zhejiang, Guangdong and other places are also mainly restocking 40S-60S medium and high-count cotton yarns. Low-count yarns are mainly used to destock and speed up loan recovery. host. Since October, the domestic supply of medium and high-grade cotton has continued to be tight, and the production capacity of carded/combed yarns with counts of 50S and above has been affected to a certain extent. Most spinning mills have shown a phenomenon of “insufficient high-count yarns and accumulation of low-count yarns.” With the release of the second batch of 600,000 tons of central reserve cotton in 2021, it will not only effectively alleviate the consumption demand of cotton enterprises for high-index, high-spinnability lint, but also the cost of high-count carded/combed cotton yarn is expected to decrease. The export competitiveness of , gray fabrics and clothing has been improved.
Three major “stumbling blocks” to current orders
1 Follow-up large orders are limited
With the end of the “Silver Ten” peak season, the market will gradually return to calm. Especially this year’s New Year’s Eve falls at the end of January, earlier than in previous years. The textile market may begin to enter a holiday atmosphere in early January, and subsequent large orders will be limited. The pressure of rising costs for cotton, yarn and other products will continue to be transmitted to consumer end-users such as clothing and foreign trade exports. The upstream price increases and the downstream inseparable “hot at the top and cold at the bottom” pattern has become a difficult problem to solve. If the market wants to go further, the entire industry chain needs to be straightened out.
2 The cost has risen sharply
In the past month, international cotton prices The overall price has risen sharply. The December ICE futures contract has risen from 110 cents to 118 cents, and the March contract has risen to 114 cents. Recently, the purchase price of machine-picked cotton in Xinjiang is 9.8-10.3 yuan/kg. Processing companies in Xinjiang generally analyze that the comprehensive cost of lint exceeds 23,000 yuan/ton (gross weight).
Weaving companies have reported poor profits this year. The price increase of raw materials cannot be smoothly transmitted to downstream, and the profits of gray fabrics are meager, putting companies in an embarrassing situation.
According to data from the Industrial Economic Research Institute of the China Textile and Apparel Federation, the raw material purchase price index of my country’s textile industry in the third quarter of 2021 was 80.6, only 0.3 percentage points lower than the price index in the second quarter. Raw material prices remained stable.Operating at a high level, the operating pressure on textile enterprises is still great. However, judging from the expectations for the fourth quarter, prices are on a downward trend, and the raw material price index may drop to 69.2.
Data source: China Textile and Apparel Federation Industrial Economic Research Institute
The average domestic cotton price in September remained at 18,237 yuan/ tons, an increase of 14.1% compared with the average cotton price in June. The price of polyester staple fiber reached 7,004 yuan/ton, an increase of 2.6% from June; but the price of viscose staple fiber fell back to 12,503 yuan/ton, a decrease of 5.3% from June. Overall, textile raw material prices remain high.
3 The recovery of foreign orders is less than expected
At present, the recovery time and extent of orders in Europe and the United States are not as good as the market It is expected that this year’s “Christmas” may be difficult to drive orders in the downstream market, and the pure cotton yarn market is expected to remain weak in the short term. In addition, the shipping market quotations are too chaotic, which also makes domestic companies more cautious in accepting orders.
According to estimates, in the third quarter of 2021, the international order index of my country’s textile industry was 51.6, and new orders were smaller than in the second quarter. According to research, the main problems currently encountered by enterprises in exporting are insufficient international orders and rising shipping costs. Many enterprises list insufficient international orders as the number one problem facing enterprises in exporting. Moreover, as production and supply chains in overseas countries recover and epidemic prevention and control measures are relaxed, overseas textile and apparel industries are taking away domestic orders.
Vietnam’s “Investment News” recently reported that the latest statistics from the Import and Export Bureau of the Ministry of Industry and Trade of Vietnam show that after nearly two years of dismal operations, in 2021, Vietnam’s yarn industry will benefit from price recovery, with the top 10 Monthly export volume increased by US$1.55 billion year-on-year. In the first 10 months of this year, the yarn industry exported 1.6 million tons of yarn, with an export value of US$4.497 billion. The volume and value increased by 15.1% and 52.7% respectively year-on-year.
View future development with caution
The biggest news in the cotton market recently is the announcement released by China Cotton Reserve on November 9, 2021 The second batch of 600,000 tons of central reserve cotton will be released from November 10, 2021.
The impact of this policy is:
1. For ginners that have just purchased a large amount of high-priced new cotton with a cost between 23,000 and 24,000, The pressure is huge, and the game between ginners and textile mills will follow.
2. If all the newly added 600,000 tons are sold this time, 1 million tons of reserved cotton will be sold this year. And according to the current release rate, the storage of cotton reserves may continue until December 2021.
In short, for cotton prices, there is short-term pressure due to increased supply. Therefore, with stable domestic consumption in the mid-line, Zheng Cotton is expected to maintain range oscillation.
On the whole, companies are more cautious in judging the industry prosperity in the fourth quarter. According to calculations, the textile industry prosperity index is expected to be 58.8 in the fourth quarter of 2021, which is slightly higher than the current industry prosperity index in the third quarter by 0.1 points. The company believes that the operating speed in the fourth quarter is generally the same as that in the third quarter. Specifically, it is expected that production will maintain stable operation in the fourth quarter; new orders may increase slightly, and market demand is expected to expand; raw material prices may fall back from high levels. </p
