There is only more than a month left before the Spring Festival. According to the past business practices of enterprises, most enterprises will summarize and plan the work of the new and old years during this period to facilitate normal production and operation during the Spring Festival. Affected by the fluctuations in the cotton market in the past few years, most textile companies have adopted the business strategy of “diligently importing and selling quickly” in recent years, which not only reduces the inventory of raw materials and products, but also reduces the operating risks of textile companies.
Recently, an information survey found that most textile companies in Jiangsu and coastal areas intend to adjust their raw material inventory structure. Investigation and analysis revealed that there are four reasons for the above situation:
First, cotton The rising trend is expected to continue. Although the current quotations of cotton and cotton yarn have fluctuated slightly, they have generally maintained high levels in the past two months. Judging from the price performance of other agricultural products and economic trends, the strong cotton market has been further supported. The strong cotton market not only brings a positive attitude to the market, but also brings a positive attitude to the market. Industry insiders boosted confidence.
Second, textile companies have relatively abundant orders. At present, the number of orders placed by enterprises can continue to be produced until the Spring Festival holiday. Although the orders vary in size and include both domestic and foreign sales, they guarantee the operation and market circulation of most enterprises. It is reported that most Jiangsu enterprises have received orders for continuous production until March-April 2021. Enterprises have increased their purchasing and sales operations, and their operating rates have increased.
Third, some textile companies with abundant orders actively mobilized workers to stay in factories during the Spring Festival holiday in order to prevent and control the epidemic and quickly complete processing tasks. After the epidemic reaches an inflection point, they will arrange for workers to return to their hometowns to visit relatives depending on the situation. Judging from the trend of epidemic prevention and control, as the number of vaccinated people increases, the epidemic relief and economic recovery support the hope of a turnaround in production in all walks of life, and textiles, as an important livelihood resource, will recover before other industries.
Fourthly, as the Spring Festival holiday approaches, logistics traffic in various places is heavy and traffic pressure increases. In order to avoid transportation difficulties during the holiday, companies often give priority to purchasing raw materials.
Based on the above four points, industry insiders analyze that textile companies will appropriately increase cotton inventories after the cold wave subsides. From a time perspective, small and medium-sized textile enterprises that consume more than 150 tons of cotton per month are very likely to have enough inventory for about two months, that is, they do not plan to buy cotton before the Lunar New Year. Of course, this also depends on the company’s production, sales, capital situation and mentality towards the market, but there is no doubt that textile companies will increase their cotton purchases before the holiday. </p
