On the 29th, news that a large number of Indian textile orders had been transferred to China spread throughout the market, and everyone discussed the authenticity of the incident and the recovery of downstream demand.
According to reports, since September, many large export-oriented textile companies in India have been unable to guarantee normal delivery due to the epidemic. Many orders originally produced in India have been transferred to my country, among which the orders for towels, bed sheets and other products are relatively large.
At the same time, several large factories estimate that the current order quantity has been scheduled until May 2021. Some people in the industry suddenly realized that the business of the dyeing factory has been so good recently and there is no holiday on National Day. It turns out that Asan’s work is all done by us!
One stone stirred up a thousand waves. At the end of September, the massive placement of foreign trade orders really made the market excited. It is understandable that the market is experiencing a wave of heated discussions. However, apart from the excitement in the circle of friends, it seems to have no impact on the futures market of bulk polyester raw materials. The main force of PTA is still going down. At the same time, the polyester raw materials have not Nice boost. Is it the self-hype of the downstream terminal market or the delayed response to the market?
Textile demand and order transfer may indeed exist under the outbreak of the epidemic
Foreign trade in the first half of this year At a standstill, most traders have received chargeback notices from customers, except for some private brands. But in the second half of the year, the situation began to change. Some countries began to place concentrated orders, such as the Middle East, Arab region and the above-mentioned Indian region. The demand in these countries is also very large, so whenever an order is placed, it is hundreds of thousands or even several meters. Hundreds or tens of millions of meters, the varieties involved are some conventional and cheap fabrics, especially home textile fabrics, which are in strong demand.
It is now the peak season for foreign trade, so whether it is European and American countries, the Middle East, South America and other places, orders are being placed one after another. The recovery of orders in different regions is different, especially India is the world’s largest cotton producer, the world’s largest jute producer, and the world’s second largest silk producer. Its yarn production capacity accounts for 22% of the world. The textile and apparel industry is one of the leading segments of the Indian economy and one of the country’s largest foreign exchange earners. The textile industry accounts for about 15% of India’s total export revenue. Therefore, after India ranks second in the world in terms of cumulative confirmed cases, the demand for textiles, especially home textile products, is extremely huge. The order transfer situation mentioned above may indeed exist.
The recent boom in foreign trade clothing orders is partly due to the gradual stabilization of the epidemic in China. Many factory supply chains have resumed operation after June, which means that they can resume operations. On the other hand, there is demand from overseas markets. Despite the serious epidemic, overseas consumer markets are still operating. September is the traditional peak season in the European and American markets. The purchase of Thanksgiving and Christmas supplies brings a large number of orders, especially online. Demand has increased significantly.
There are worries about the abnormal order recovery path, and orders may be canceled again
But everything is possible There are two sides. As foreign trade orders pick up, textile people still have certain concerns about abnormal order recovery. Since September, countries around the world have experienced another high outbreak of the epidemic, and the number of new confirmed cases of COVID-19 in a single day has continued to rise. As the epidemic continues to develop, stricter social distance restrictions may be implemented later.
In recent times, many traders have received a large number of orders. On the one hand, this is because according to the practice in previous years, in order to prepare for the Christmas season, foreign customers will place orders in advance. The end of September to October is the time point for concentrated orders, and the rebound of the epidemic happens to occur at this time. Now traders are exporting Whether these orders will be canceled or delayed again due to the epidemic is also one of the biggest concerns for textile bosses.
“Now we can only try to ship the goods as quickly as possible. Fortunately, the dyeing and weaving factories are not busy now. From order placement to shipment, we can do it within one week. It needs Custom weaving will take a little longer, but in short, we should make it as soon as possible and ship it as soon as possible to avoid a series of problems later.” A trader lamented.
Receipt and delivery risks, beware of buyers “disappearing”
Although foreign trade is currently slowly moving towards On track, but the impact of the epidemic is huge. Weak demand has caused a major blow to the global textile industry. Many foreign trade companies are struggling to hold on, and their financial situation is very tight. Many clothing companies and foreign trade companies have seen their capital chains break and go bankrupt. In the first half of this year, there were many cases of customers going bankrupt and unable to pay the balance. Now many foreign trade customers have longer billing periods than in previous years. Textile workers need to reasonably control the billing period to ensure that they can recover their accounts at the end of the year.
In addition, there are signs of a rebound in the epidemic in various regions. Once a second epidemic breaks out, these countries may again adopt “city closures” measures, which is very likely. Orders are subject to secondary cancellations and suspensions, and there may even be situations where the goods arrive unclaimed at the destination port. Can foreign trade companies that experienced the first cancellation of orders still be able to withstand this second wave? Moreover, in many contracts, there is no explanation of the customer’s breach of contract, and the penalty ratio is generally…�� will exceed 10%, which is difficult to offset the costs already paid.
Whether it is the previous Sino-US trade war or the current COVID-19 epidemic, it will be a protracted war. Professor Zhang Wenhong recently pointed out that the new coronavirus has become a “resident virus” existing in the human world and is still in the pandemic stage around the world. Therefore, whether at home or abroad, “small sparks of the epidemic” may appear in some areas, and foreign trade There are still many uncertainties. Although foreign trade orders are currently picking up, we cannot take it lightly. Textile companies must do a certain amount of risk control.
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