On April 7, stimulated by crude oil, the polyester market was booming, and polyester filament finally bottomed out and rebounded with the support of all parties! Especially for FDY products, the price rose by 400 yuan/ton in a single day, the largest single-day increase since 2012. Other products also have room for growth to varying degrees.
This news can be said to be the best news for the polyester market since March. March, which was supposed to be the peak season, not only saw weak prices, but also only a handful of mainstream polyester market production and sales prices exceeded 100, and the duration was extremely short-lived, with most of the prices being “one-day trips”.
Companies have successively reduced production, but still maintained a relatively high operating rate
Due to the cumulative increase in overseas cases of new coronary pneumonia, many countries With production suspended and foreign orders cancelled, the textile foreign trade market has come to a standstill. The domestic sales market has also been affected, with orders weak. The entire textile market has entered the off-season ahead of schedule, and some weaving companies have even begun to reduce production.
Machine start-up status
Production reduction
Specializing in the production of memory-like weaving The boss of the manufacturer said that there was a production reduction operation at the end of March, and the operating rate dropped from the original 100% to 75%. However, we received several orders in early April, so the machines were fully operational again.
Holiday
A person in charge of an Oxford cloth company said that the machines are still fully operational, but they are full of loose orders and the quantity is very high. It is small, and most of the gray fabrics produced are used for inventory. We plan to take a 4-5 day holiday in mid-April.
Affected by this, the pressure on polyester manufacturers has doubled. The biggest influencing factor is naturally the downstream Drag down by insufficient market demand! So, what is the current attitude of downstream weaving companies towards raw material procurement?
Polyester prices are low, is it time to buy raw materials at the bottom?
Some gray fabric companies with plans to reduce production are still buying a lot of raw materials
After a long period of price decline, the price of polyester filament has It has fallen to a very low position, and polyester manufacturers have a very strong willingness to raise prices. From a price point of view, the current price of conventional raw materials is not only the lowest this year, but also the lowest price in the past three years. According to feedback from some polyester manufacturers, some companies have purchased raw materials in large quantities recently.
However, in the recent period, there have been insufficient orders and high inventories. When some weaving companies have begun to reduce production, why are there still weaving companies buying large amounts of raw materials? What is the purpose of the raw materials you should buy? Through market research and feedback from China Silk City Network, we got the answer.
The person in charge of a gray cloth company that produces Oxford cloth all year round revealed: “The price of raw materials has been low recently. The polyester yarn worth RMB 5 million is bought at the right time. Part of it is used for production inventory. Although the original inventory is also relatively high, it can only continue to produce inventory without orders. The other part can be said to be a bargain-hunting investment. One day the price will I will go back and take a gamble!”
Some gray fabric companies are more than willing to buy low-priced raw materials
For Manager Sun of the raw material procurement, industry and trade integrated enterprise has a completely different attitude. The overseas situation is turbulent and the market is unclear. He feels very unsure. He will not buy the bottom at all, and there is no need to buy the bottom. Even if the price of raw materials is now low, it is difficult for polyester yarn prices to continue to rise due to a market with no orders. Therefore, the stocking of raw materials is only maintained at about 10 days and is purchased on demand.
There is a certain degree of gambling involved in bargain hunting for raw materials, and the risk is relatively high. Even so, bargain hunting is only carried out when funds are available. However, since this year, trade orders have dropped sharply, gray fabric shipments have dropped significantly, and the payment collection cycle has been extended. Cloth bosses’ funds are either stuck in inventory or floating outside. The liquidity on hand is only enough to maintain the operation of the company, and it is also unable to buy raw materials at low prices.
The boss of an imitation silk company is very helpless: “In the current market situation, I don’t have any funds at all. I can only think about how to buy the bottom. If I don’t have money, I will just sell fabrics honestly.” !”
Polyester prices have been stumbling since 2019 and have remained low for a long time. Judging from the current textile market, the future prospects of polyester filament are still unclear. Under the dual pressure of polyester inventory and the global fermentation of the epidemic, it is difficult for downstream weaving companies to stock up on a large scale for a long time as they have in the past few years.
Polyester prices occasionally rise, can it drive the sale of gray fabrics
According to previous years’ experience, the price of raw materials After ushering in a long-awaited rise, it will also drive the shipment volume of gray fabrics. On Tuesday this week, raw materials increased significantly, and we also conducted research on changes in gray fabric shipments.
Most weaving companies said that the rise in crude oil and polyester prices this week did not boost the sales of gray fabrics. The shipment volume of gray fabrics is still slow, and the small batch and multi-batch model is dominant. Large orders have almost disappeared, and orders of 1,000 meters have become the norm.
Nowadays, the price of polyester yarn is low, and the price of gray fabric has also dropped again and again, and selling goods has become the norm. According to previous yearsAs usual, a group of traders will appear in the market to stock up on gray fabrics. However, there has been no movement this year. Few gray fabric manufacturers have encountered traders who are stocking up.
Some gray fabric companies have even reported that due to the recent sharp drop in orders and the excessive inventory accumulated since last year, they want to digest it through traders and sell it at the best price, but they are still unable to stimulate trade. Business interest ended in failure.
Postscript
In general, the “scarred” textile market will take a long time to repair, and it is difficult to provide short-term good news. Vibrate the market. We still need to be cautious when buying raw materials at the bottom. For weaving companies, if there is no obvious pressure on funds, purchasing raw materials is now an option, but it still needs to be based on its own strength, rather than blindly pursuing speculation and buying blindly. Orders will eventually improve as the epidemic situation improves. At this stage, as long as we stay calm and make our own products well, we will be most stable.
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