The first quarter is the peak season for textile and apparel companies, but this year’s overseas orders for domestic textile and apparel companies are “unequal”.
“Overseas finished product orders are not very good now because foreign inventories were very high last year.” A person in charge of a textile company from Suzhou said that they mainly do In European and American foreign trade business, “We send emails to overseas customers, but they basically don’t reply, and there are no orders.”
The reporter found that compared with textile finished products, On the contrary, some companies that mainly export raw materials, such as yarn, have good overseas orders. Mr. Wu, the owner of a textile company from Jiangsu, told reporters that his company mainly produces yarn, and now “more than a dozen large containers” of directly exported yarn have been shipped out. There are also 300 orders that have been placed but have not yet been shipped. Around tons.
Currently, cotton yarn in countries such as Pakistan is out of inventory. Judging from the export orders of textile raw materials in different regions, the popularity of orders for semi-finished raw material yarns is mainly concentrated in viscose and blended cotton yarns, while the popularity of pure polyester and chemical fiber yarns is relatively weak.
Raw materials drive fabric prices
In the spring of 2021, a wave of rising prices for textile and apparel fabrics has impacted the entire market.
A Zhejiang company that mainly produces fabrics told reporters that the trend of raw materials last year was relatively stable, and fabric prices basically did not fluctuate much. However, the price of fabrics has increased significantly after the Spring Festival this year. The most important reason is that the raw materials and yarns of fabrics have increased across the board, resulting in an increase in the price of gray fabrics. Coupled with the fact that the weather has warmed up earlier this year, textile companies rushed to start production, causing the demand for fabrics to suddenly become tense.
At the beginning of this year, with the increase in the prices of various commodities in overseas markets and the sharp rebound in crude oil prices, the price of fiber materials increased sharply. Among them, the prices of spandex and viscose have exceeded the pre-epidemic price levels after the increase. Especially the price of spandex has more than doubled in just half a year.
The increase in textile and clothing raw materials at the beginning of the year was mainly driven by the increase in yarn. On the one hand, the price of textile raw materials continued to fall last year, and weaving companies continued to hoard goods at will, resulting in downstream Inventories are overall lower; on the other hand, orders squeezed out around the Spring Festival have exploded, and combined with the early start of work brought about by celebrating the Chinese New Year this year, the entire market has a greater demand for raw materials. Yarn raw materials are in short supply, prices are rising rapidly, and fabric prices are also rising.
The strong demand for yarn is not limited to domestic textile companies. The demand in Southeast Asia is also not small. Behind this, it is related to the return of some finished textile and garment orders from Southeast Asia to the local area.
Southeast Asian orders “anti-reflow”
According to the Economic and Commercial Office of the Chinese Embassy in Pakistan, data released by the Pakistan Bureau of Statistics on February 18 showed that in the first seven months of this fiscal year (July 2020 to 2021 In January 2019), Pakistan’s textile and clothing exports increased by more than 8% year-on-year to US$8.76 billion. Among them, export volume in January 2021 increased by 10.79% year-on-year to US$1.32 billion. It is understood that the growth of textiles and clothing mainly comes from high value-added textiles, such as knitwear, towels, bedding, etc.
Appeared in August and September 2020 Some Southeast Asian orders are transferred to China, mainly because the epidemic situation in some areas of Southeast Asia is severe and it is difficult for factories to produce normally. However, our country has carried out strong prevention and control of the new crown pneumonia epidemic at the beginning of 2020, and we have a complete textile The industrial chain can be quickly put into production. As a result, the entire textile market was in peak season in September and October 2020, and many dyeing factories also took this opportunity to decisively increase dyeing fees.
But this situation in November 2020 It has slowed down significantly since then, especially as the global epidemic prevention situation has begun to improve significantly recently. Southeast Asian countries such as India, Pakistan, and Bangladesh have seen a sharp decline in the number of new confirmed cases every day. After the epidemic in Southeast Asian countries was brought under control, orders began to flow back to the local areas steadily.
It is expected that with the vaccine already available, the possibility of Southeast Asian textile and apparel orders flowing into China again this year is relatively small. The trend of mid-to-low-end textiles moving from China to Southeast Asia is difficult to reverse, and China’s greater opportunities in the future lie in quality control and further optimization and integration of the supply chain.
Uneven exports of raw materials and fabrics
At present, from the perspective of yarn raw materials, regardless of ��Both domestic orders and foreign export orders are “overflowing”, especially some special yarns that can only be produced domestically are in high demand.
“From the end of February to now, our orders and shipment orders have exceeded 50 million yuan, and these goods must be cleared by the end of April. Comparison In 2020, our total order quantity was about 12 million yuan, which was about 4 times different. And due to the increase in raw material prices after the year, we also turned down 200 tons of orders, which is equivalent to more than 10 million yuan.” Production of yarn Mr. Wu, the person in charge of the company, said.
He further stated that their yarn customers mainly come from Bangladesh, India, Turkey and other countries, and they are constantly developing new customers. “Complex yarns in Southeast Asia are all imported from China. Nowadays, it is possible to make ready-made garments abroad, as well as conventional yarns. However, some popular yarns and special products are not available abroad, so our development capabilities are relatively strong.”
However, there are also domestic companies whose exports have been “cold”. Mr. Ou, the head of a textile company, said that their overseas textile orders this year did not perform well. Last year, the company’s overseas orders accounted for 80%, but this year it fell to only 20%. The most serious decline was in finished product orders.
“High.” “Our direction this year is to abandon foreign trade and only do domestic business. We have done a good job in destocking domestically in the past few years. However, overseas customers will definitely not discard it, although they currently have no desire to purchase.”
High inventory, which mainly refers to finished textile and clothing products aspect. According to a report released by McKinsey in early March, the unsold ready-made clothing in stores and warehouses around the world is currently worth approximately US$168-192 billion, more than twice the amount before the epidemic.
Currently, there is a situation of order differentiation. Some orders of varieties are transferred to foreign countries. On the other hand, although orders of some varieties are transferred to foreign countries, there are no supporting products abroad. The complete industrial chain cannot bypass China, and can only be produced indirectly through the import of intermediate products from China. In the end, foreign trade customers showed that they have a greater demand for special yarn raw materials, but they have little interest in downstream fabrics and clothing.
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