September is coming soon, and the order situation in the market has begun to improve. Some pictures of orders showing off have also appeared in the editor’s circle of friends. The difficult time has finally passed.
However, when orders are placed, money may not be earned. As market demand grows, textile workers will face the familiar soul torture: do they want orders or profits?
Can oil prices beat the oil-producing countries?
Since the beginning of the Russia-Ukraine war, international oil prices have gone from rising to falling, rising again, falling again, and recently rising again, with the highest rising to 120 US dollars and the lowest falling. Breaking 90 US dollars, changes in oil prices have also driven the price of polyester raw materials onto a roller coaster ride.
The current crude oil price is affected by several factors:
1. Inflation. Crude oil serves as a raw material for most industrial products and a fuel for logistics and transportation, and rising prices directly affect inflation. As crude oil prices rise, inflation in Europe and the United States significantly exceeds expectations, so interest rate increases will occur, which will suppress oil prices.
Second, geography. Geopolitics has always been the main factor affecting oil prices. Whether it is the Russia-Ukraine war or the Iranian nuclear issue negotiations, they will affect the supply and demand of oil, thereby affecting oil prices.
Three, oil-producing countries. With the current high oil prices, oil-producing countries are struggling to count money. Naturally, they do not want oil prices to fall and reduce their own profits. Therefore, once oil prices are too low, oil-producing countries will release news of production cuts to maintain oil prices.
Therefore, the editor judges that the price of crude oil will still fluctuate within the range of 90-120 US dollars in the future. This price is also high in history. Production at this price The polyester yarn that comes out will certainly not be much cheaper.
Low raw material inventory, high gray fabric inventory
The price of raw materials remains low, making it difficult for textile companies to stock up on silk.
After several consecutive years of “severe beating” starting from 2019, weaving companies no longer dare to stock up on polyester yarns in large quantities. If you ask the person in charge of the company now, most of them will answer that you can use it as you buy it. Generally, the quantity of silk in stock will not exceed one month. If the price is about to increase or there is a big promotion, you may buy next month’s quantity in advance, but the inventory will still not be very high.
In contrast, there is a high inventory of gray fabrics.
According to the data monitoring of China Silk City Network, the current gray fabric inventory of weaving enterprises in Jiangsu and Zhejiang is about 37 days. This does not include the large number of fabrics in stock in supermarkets and traders. The actual inventory should be higher.
Under the influence of low inventory of raw materials and high inventory of gray fabrics, textile companies will not encounter small financial pressure, but the flexibility in the operation process will be relatively low.
Supply exceeds demand, exacerbating involution
In the first two years after the epidemic, although the demand for textiles shrank, it was not very obvious. This is because European and American countries have been borrowing money to maintain consumption.
But this year, after these countries began to “lie down”, demand began to decrease significantly, and the accumulated economic problems in some other countries also began to explode. Except for a few energy countries, the economic data of most countries in the world are not good.
Demand has decreased, but production capacity cannot be cleared in time. Even in Southeast Asian countries, production capacity is constantly increasing, and the oversupply situation is very obvious.
For this reason, the inventory of large supermarkets such as Wal-Mart has exceeded the warning line, and orders have begun to be reduced. Southeast Asian countries have also gone from a labor shortage in the first half of the year to a current wave of layoffs.
�Excess energy leads to the involution of the textile market. Times have been tough this year. Even some big international brands known for their high-quality products have begun to lower their prices and take the cost-effective route, let alone some conventional products. The current situation is that everyone can make the most popular conventional products, and there is not enough meat to eat, so we can only compete on price. In the end, we can only choose one for profit and order.
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