The start-up of warp knitting enterprises in Jiangsu and Zhejiang has increased. The increase in the start-up rate is not caused by new orders. It is mainly prepared for autumn and winter orders, and the inventory of gray fabrics in the factory has increased accordingly. The warp knitting enterprises in Changle area have made some slight upward adjustments. The overall sales of downstream fabrics are still flat, and the overall performance of the factories can still maintain normal operations. In terms of new orders, some new fabrics are more popular in the market, while conventional fabrics are generally sold, and factories mainly keep inventory. As for circular knitting machines, Ramadan is over, the enthusiasm for placing orders in the Middle East has improved, and there are also reports of increased inquiries from Europe and the United States.
Looking specifically at the main types of looms:
Circular knitting machines: The average operating rate was 56.55%, an increase of 2.44% month-on-month. The atmosphere of the textile off-season becomes more intense after the holidays, and factories have to reduce their workload due to lack of orders. In addition, after the Ramadan festival, the enthusiasm for placing orders in the Middle East has improved. There are also reports of increased inquiries from Europe and the United States, mainly involving pure cotton yarn, polyester yarn, etc. Yarn and other raw materials. The industry lacks confidence in the sustainability of orders in the future. In particular, cloth merchants have large inventories and are less motivated to place orders. The profits of circular knitting knitting mills have been further compressed.
Water jet loom: the average operating rate was 71.71%, a month-on-month decrease of 6.88%. But in reality, due to the lack of orders in the first half of the year, small and medium-sized factories have begun to reduce their load before May Day. In particular, the load of factories making conventional gray fabrics has already dropped to 50-60%. load requirements, the production restriction order has limited impact on it. There are currently no clear requirements for production cuts and production restrictions in other regions. Some small and medium-sized enterprises have not had strong order continuity, and construction starts have gradually declined since April. After the end of Ramadan, the market reported that terminal gray fabric transactions have improved. However, due to the high cost inventory of fabric merchants, demand has not been reflected in the weaving industry. As for the high temperature weather in June, weaving production was restricted to a certain extent, and the start of production in June is expected to decline.
Warp knitting machines: The average operating rate was 74.18%, a month-on-month increase of 3.07%. Since the May Day holiday, local warp knitting companies in Changshu have started to operate more. The increase in operating rates is not due to new orders, but mainly to prepare for autumn and winter orders. The inventory of gray fabrics in the factory has increased accordingly. The current export orders are not ideal; this week, most warp knitting companies in Haining are operating at full capacity, and a small number of operations are around 70-80%. The number of new orders placed is low, and profits have declined significantly. The factory maintains high operating levels to produce finished product inventories. Lord. Entering May, warp knitting operations in Haining remain high. Domestic and foreign orders for home textile and toy fabrics have been placed recently, while orders for clothing fabrics have been slightly light. The overall performance of warp knitting factories in Changle area can still maintain normal operations, and raw material procurement still needs to be supplemented. , in terms of new orders, some new fabrics are favored by the market, while conventional fabrics are generally sold, and factories mainly stock them. At present, profits are still gradually compressed, and it is expected that the market will mainly operate stably and weakly in the short term.
The operating situation of coastal textile enterprises is improving
According to a certain company in Yancheng, Jiangsu According to the color spinning factory, the spot price of local cotton has risen slightly recently. The factory’s 3128B grade cotton is priced at 16,200-16,300 yuan/ton at the public inspection, which is 100-200 yuan higher than more than a week ago, because the price of gauze is also currently increasing slightly. Therefore, the vast majority of small and medium-sized general and worsted spinning enterprises can accept such a market, and the production and operation situation shows a normal and positive trend.
Despite this, most textile companies and fabric factories that mainly do “short-term, flat and fast” orders still adopt a low-key business strategy. Among the companies interviewed, quite a few do not have large inventories, and the purchase of raw materials and the delivery of finished products are fully controlled within a small quantity (the average inventory of raw cotton is about one month; product inventory is controlled at about ten days of output). It is reported that at present, the order business of small and medium-sized textile mills in coastal areas of Jiangsu and Zhejiang is relatively full. 80% of the orders for yarn mills with 20,000 to 60,000 spindles in Yancheng City are scheduled for two months later. These orders are all for domestic sales. As for the downstream terminal flow, Small textile mills don’t pay much attention to it. They only need to upload orders and contracts. What they focus on is how to complete order tasks and order continuity with quality and quantity.
At present, more small and medium-sized textile enterprises have a “do it now” mentality. The market for floral gauze is not stable, foreign epidemics and a few countries have imposed sanctions on Xinjiang cotton, etc. All are of great concern to enterprises. Fortunately, the supply in the cotton market is guaranteed. Although transportation costs have increased, there is no need to worry about circulation efficiency. In such a special operating environment, small businesses can only operate steadily and strive to ensure the normal operation of the enterprise. Slight surplus.
Market concerns have increased
According to Jiangsu, Henan, Cotton spinning companies in Anhui and other places have reported that in the past week or so, the Zheng Cotton CF2109 contract has continued to consolidate and gain momentum within the 15,500-16,000 yuan/ton compartment; in addition, the pressure on cotton yarn accumulation in cotton spinning mills is still low, and the production and sales of 21S-40S cotton yarn It is relatively smooth (some textile companies report that the supply of C32 and C40S mid-to-high-end cotton yarn is slightly tight), so the cotton yarn quotation remains at the level of mid-May. “Let the raw materials be blown by the wind and waves, the cotton yarn will remain unchanged.”
A medium-sized textile company in Zhengzhou said that since April/May, except for OE yarn and 8S-16S low-count ring spinning orders, there has been little improvement or slight improvement, and 26S-60S Inquiries and orders for carded yarn are satisfactory, and shipments of high-count combed yarn are also picking up compared to February/March. The factory’s strategy is to “purchase high-grade and high-quality cotton and spin 32S and above cotton yarn”, 21The output of cotton yarn with counts S and below has dropped significantly.
From the survey, some yarn mills currently have orders extended to mid-to-late June, and the prices of raw materials such as cotton, polyester staple fiber, and viscose staple fiber have fluctuated since April/May. Judging from the situation and sales quotations of cotton yarn and polyester-cotton yarn, the net spinning profit of cotton spinning enterprises is at a relatively high level; in addition, the payment recovery and operating capital situation have gradually improved compared with the previous period, so the ability to resist risks and maintain production is strong. A textile company in Jiangsu reported that in recent days, downstream weaving mills, traders and other customers’ inquiries and delivery of goods have slowed down, and market concerns have increased, focusing on the following points:
First, as the epidemic in India, Bangladesh, Pakistan and other countries has gradually come under control, the return orders from Europe, the United States, India and other countries have gradually recovered or lacked sustainability in the production of yarn mills, cloth mills and downstream industrial chains;
Secondly, according to usual practice, the domestic sales market enters the off-season in June and July, and it remains to be seen whether the gauze can achieve “not out of season”;
Thirdly, sea freight has risen sharply. The “hard to get a ticket” space and the serious accumulation of cargo in some ports in Europe and the United States, resulting in increased demurrage costs, etc. need to be carefully considered, especially when accepting medium and long-term orders, you are worried about the situation of “losing your wife and losing your troops”;
Fourthly, it is still difficult for textile and clothing companies to lock in foreign exchange, increase exchange rate fluctuation clauses in contracts, and sign forward foreign exchange settlement and sales agreements with banks. Once the RMB appreciates significantly, the profits of textile and clothing companies will be swallowed up or even suffer losses.
Many factors have increased the pressure on small and medium-sized yarn mills
Currently, from small and medium-sized yarn mills and weaving enterprises Judging from the feedback, we are still facing various operating pressures, which can be summarized as follows:
First, since January 2021, banks’ credit support for small and medium-sized cotton textile enterprises has been stronger than in the first half of 2020. There has been a relatively obvious decline, the difficulty of borrowing has gradually increased, and some textile companies said that the pressure on capital flow continues to rise.
Second, as some autumn and winter domestic sales orders are issued, although cotton yarn and gray fabrics have accumulated inventory, it is not outstanding. There are very few companies that have reduced or suspended production in the near future, but consumer terminals such as fabrics, clothing and foreign trade companies Customers’ cash flow is generally tight, and it is increasingly difficult to collect gauze payments in a timely manner. Some customers even propose various payment methods such as credit, 1 to 3-month account terms, letters of credit, etc.
Third, the prices and costs of foreign trade orders or processing orders distributed by large companies are relatively serious. Enterprises said that although the general contract quantity is large, the processing period is long, and the proportional payment of the payment is relatively timely, Considering that profits are not high, the appreciation of the RMB and the price of raw materials such as cotton and polyester staple fiber may still fluctuate significantly in the second and third quarters of 2021, they are unwilling or afraid to take long-term orders.
Fourthly, compared with large-scale cotton textile enterprises, it is difficult for small and medium-sized enterprises to recruit, retain, and train talents. Therefore, the problem of “labor shortage” is more common. A yarn factory in Handan, Hebei said that the current job vacancy rate is 10% to 15%. On the one hand, due to the limitations of the working environment, office conditions, and factory location, young and educated people are unwilling to enter the factory; on the other hand, the company’s salary, Salaries and other benefits are also lower than those of large factories or companies in southeastern coastal areas.
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