Recently, most textile companies in Jiangsu and Zhejiang have officially resumed work, but not all workers have arrived, and the production capacity of weaving and dyeing factories has only restored about 30%. The current market can only be described as a “tentative resumption of work.”
Traders took the opportunity to stock up, and weaving manufacturers took the opportunity to destock
It is reported that the Wujiang area has just resumed its market, and some gray fabrics have started to rise. After further understanding, most of the gray fabrics that have increased in price are ordered goods, which have higher quality requirements, so manufacturers do not have much inventory.
A trader in the Shengze area revealed: “Now many gray fabrics have gone up. The main reason is low production capacity. Basically, there are only cloths in stock from years ago. For easy-to-sell gray fabrics, such as imitation silk, T400, etc., no Many traders have the idea of stocking up, which has resulted in a situation where supply exceeds demand.”
Currently, traders are more cautious about stocking up and do not stock up on a large scale. This has also resulted in the inventory of weaving companies not falling very significantly. Judging from last year’s experience, traders who stocked up a lot of goods could only face the embarrassing situation of cloth being left in the warehouse during the off-season.
As for market products with low quality requirements, most manufacturers say they have no confidence to increase prices. “We have not raised prices, but we will not drop prices in the short term. Now we just want to reduce the inventory a little. The inventory a year ago reached as much as three months. Now if customers want it, we will ship it. We shipped 40,000 yuan yesterday Rice, 50,000 meters were shipped today, and reducing inventory is the first priority.” A pongee manufacturer said.
Coincidentally, a manufacturer specializing in peach skin velvet also said: “Due to low production capacity recently, there are a lot of goods on the market. Companies have taken the opportunity to sell off a wave of inventory. But the market is ultimately determined by demand. The epidemic affects consumer demand. When production capacity increases in the later period, inventory pressure will reappear.”
The enterprise’s gray fabric inventory is too high, which directly affects the difficulty of capital turnover. In addition, the longer the inventory is backlogged, the less valuable it will be. Therefore, when the market improves slightly, Boss Bu hopes to turn the inventory in his hands into cash. Through this epidemic, I believe everyone understands the importance of cash. Cash is needed to buy raw materials, pay wages, and pay rent….
“Our company has about 50 people. We have no work this month, so we have to prepare at least hundreds of thousands of cash flow.” In 2019. The market has taken a turn for the worse, and many manufacturers are operating at a loss. Taking polyester taffeta as an example, the machine rate has dropped to 10 yuan or even lower, resulting in manufacturers of conventional products not having enough money. Furthermore, many receivables at the end of the year have not been received smoothly, which has further aggravated the “money shortage” in the textile industry.
Terminal orders determine the textile market
The textile market is still determined by terminal orders. There is a lack of terminal orders and procurement efforts cannot keep up. The current prosperity of the textile market, The price increase may also be short-lived.
As the largest first-level clothing wholesale market in China, Guangzhou Shisanhang and Sijiqing are currently closed due to the impact of the epidemic. It is reported that Guangzhou No. 13 Bank will postpone the opening of the market indefinitely, and the opening time of Hangzhou Sijiqing will also be postponed to March 1. The delay of more than 20 days has reduced the sales opportunity of the spring model by one-third. “Even if the market opens, there won’t be many people coming to buy goods for the time being. It seems that we have to be prepared for one less season of business this year.” A clothing store owner said.
From the perspective of consumers, when the epidemic is over, many people’s consumption concepts will also change. Although clothing is Necessities, but in the face of the epidemic, clothing seems to be less important. Safety needs are the first priority, such as masks, disinfectants, and food expenditures are increasing. As one goes and the other goes, consumption of clothing may not recover for a long time.
Furthermore, South Korea has recently entered a state of high alert, and the epidemic situation in Europe has also worsened. Consumer demand in these regions will also change, which will also affect the orders received by foreign trade companies.
Afterword
At present, there has been a wave of “busy” signs in the textile market recently, and it seems that the “Golden Three” is on its way. . Weaving factories are busy delivering goods, traders are busy stocking up, and dyeing factories are busy with delivery dates. But in the later stage, as the epidemic ends, workers are in place, and production capacity recovers, the situation will gradually return to normal. It will also take some time for consumer demand to recover. It is expected that the textile peak season from March to May will also be discounted. Fabric bosses need to be mentally prepared in advance! </p
