According to feedback from small and medium-sized cotton textile enterprises in Hubei, Jiangsu, Shandong and other provinces, the shipment of back-end products such as cotton yarn, gray cloth, and fabrics has gradually slowed down since mid-November, and some enterprises have begun to experience product inventory accumulation. Current inventory and financial pressures It’s not too big and within the affordable range, but yarn mills, weaving mills and clothing companies are not optimistic about the production and sales situation in January.
The situation of small weaving enterprises such as Hebei and Henan continuing to reduce production suspensions has continued to increase compared with September and October, and the quotations of OE yarns and 32S and below yarns have continued to fall (inquiries for cotton yarns above 60S and high-end bleached cotton yarns and Transactions are relatively active). Judging from the survey, the general accounting period for downstream sales of cotton yarn, gray cloth, fabrics, clothing, etc. in 2020 is 1-3 months. In addition, some companies are facing expenses such as loan repayments and supplier payment settlements near the end of the year, so they have increased payment collection. Strengthen your efforts to achieve peace of mind as soon as possible.
Why did downstream production and sales enter a downward channel just after the “Golden Nine and Silver Ten”? The industry summarizes the following points: First, terminal textile and clothing foreign trade and domestic sales orders lack “sustainability”. A large number of cotton textile companies receive fewer orders or even no orders after mid-December (“Double 11”, Thanksgiving, Christmas will lead to some overdraft of consumption capacity in the future); secondly, the impact of the new crown epidemic in Europe and the United States on textile and clothing exports is prominent. Although there are relatively few cases of voluntary cancellation of contracts or non-delivery of goods due to breach of contract, many European countries have implemented city closure orders for about a month, which has greatly affected trade, logistics, transportation, etc., and a relatively large proportion of textile and clothing contracts have been postponed for one month. Third, after the epidemic, consumer demand in Europe, the United States, ASEAN and other countries has been released intensively (especially e-commerce). Containers in China’s ports are very tight, and it is even “hard to find a box”. Recently, sea freight prices have continued to rise sharply, and textile and clothing export costs and delivery The pressure on goods has risen sharply; fourth, the RMB has been appreciating strongly since October, resulting in many textile and clothing export contracts with no profits or even losses; fifth, concerns about the “resurgence” of the new crown epidemic in winter and spring, the U.S. election, and China policies have made China Cotton textile and garment factories, processing companies, and foreign trade companies are becoming increasingly cautious in accepting orders from Europe and the United States. </p
