I still remember that in early August last year, the editor was chatting with a friend who was doing business in the market. He complained to the editor:
Due to the early arrival of the off-season, manufacturers of conventional products such as pongee, polyester taffeta, and imitation silk have generally encountered high inventory problems. The inventory of some large manufacturers has even reached Tens of millions of meters, there is still one month left before September when the market started to improve in the past, and the market in 2019 is basically over.
This year, due to the impact of the epidemic, this time has been advanced to before July.
The law of failure and the “all the way up” inventory
According to the normal market situation in previous years, textile The market generally has two peak seasons: the first one starts in March and usually ends in early June, and the main products are spring and summer fabrics; the second part starts in September and usually ends in November, and the main products are autumn and winter. fabric.
At the beginning of the peak season, the number of orders is the largest, so there are always “gold, three, silver, four” and “gold, nine, silver and ten” However, this statement does not seem to be valid in the past two years.
The following is the average inventory trend chart of weaving enterprises in Jiangsu and Zhejiang since 2017. We can clearly see that: before April 2018, the average inventory trend of weaving enterprises Although the inventory is constantly fluctuating, the overall range is stable. The inventory has increased within a certain period of time. After a while, during the peak season, it will fall back to its original position; but after April 2018, the situation has changed dramatically. Although weaving inventories have risen and fallen over time, the decline has not kept pace with the increase, which has ultimately led to higher and higher inventories.
, which is two days higher than the highest of 42 days in 2019. What’s even more frightening is that July has just begun.
While weaving companies suffer from inventory problems, polyester Enterprises are also not having a good time. It can be clearly seen that the average inventory of polyester factories in 2019 is higher than that in 2017 and 2018, and the impact of the epidemic in 2020 is much higher than that in 2019.
Promotions and sales are frequent, but they still cannot be sold
In a competitive market, the market The more products in the market, the fiercer the competition, the lower the price of the product will be. In order to survive, the company may even sell at a loss. This is a truth that everyone in business understands.
During this period, the textile market has shown such a trend.
Take the most common polyester taffeta on the market as an example. Because of its low cost, low threshold, relatively easy storage, and relatively large demand, when there is a shortage of polyester taffeta on the market, When fabrics are selling well, polyester taffeta has become a loss-stopping choice for many companies. Some time ago, news spread that some weaving companies were using imported Tsudakoma looms to produce polyester taffeta.
This has caused the price of polyester taffeta to plummet. The current market price is less than 1 yuan/meter, and the machine rate has even become negative. Even at such a “loss-making price”, the inventory of most weaving companies still only rises but does not fall.
The price of polyester filament is actually similar. Time has increased by 1,000 yuan/ton due to the rebound in oil prices, but weaving companies simply don’t buy it. Polyester companies are also very anxious. They have launched a “big promotion” again, and the price of polyester yarn has begun to fall. However, the weaving companies that are determined to buy and use it still cannot let them buy more yarn. The recent polyester production and sales data are only Not pretty.
The same is true from a year-on-year perspective. The price of polyester yarn is basically inversely proportional to the inventory. The price of polyester yarn in the same period in 2018 was nearly a thousand yuan higher than that in 2019. The price in 2019 is more than 3,000 yuan/ton higher than that in 2020.
The market is picking up It may not be until next year, but the biggest enemy is time
A person in charge of a weaving company that specializes in four-sided elastic said that the current market situation is not good. But there are pros and cons, and the low raw material prices are unprecedented. In fact, everyone knows that the market will get better. As soon as the epidemic is brought under control, orders will definitely rebound. By then, the prices of raw materials, cloth, and dyeing fees will surely increase.The price will increase.
But it is not easy to wait for the market to pick up. In the International Textile Federation’s survey on the impact of the COVID-19 epidemic on members, affiliated companies and associations of the International Textile Federation, we can see that 20% of textile companies believe that it will take until the fourth quarter of 2020 to return to pre-crisis levels, and 23% and 21% believe that recovery will take place in the first and second quarters of 2021 respectively.
Even with the most optimistic estimate, and counting The time to stock up in advance means that such a lackluster market will last at least three months. Before the market improves, to what extent the inventory will increase and whether the capital chain can be maintained will become a huge challenge for weaving companies. .
Therefore, for textile companies, the biggest enemy is nothing else but time!
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