The impact of the epidemic continues. Recently, Jiangsu Sanfangxiang Industrial Co., Ltd. (hereinafter referred to as “Sanfangxiang”) issued an announcement announcing that taking into account the market environment and operating costs, the company predicts that it will be difficult for the compact spinning production workshop to resume normal production and turn around losses in a short period of time. In order to avoid Due to further losses, the company decided to suspend production in the compact spinning production workshop.
There is no doubt that the epidemic has caused a sharp reduction in end consumer demand and impacted the development of all walks of life. The textile industry is also not immune. The current production and operation pressure of textile enterprises is still relatively prominent. , high inventory and low profits have become the biggest problems plaguing enterprises.
Spinning production in Sanfangxiang is suspended and some weaving plants are shut down
The business of Sanfangxiang is divided into There are three major sectors: textile business, chemical business and thermoelectricity business. Among them, the textile business is mainly printing, dyeing, finishing and spinning. The company has been rated as one of the top ten enterprises in my country’s printing and dyeing industry, with an annual production capacity of 100 million meters of printing and dyeing cloth and 20,000 tons of yarn.
However, this well-known company in the industry seems to be somewhat unable to do what it wants this year. The semi-annual report shows that in the first half of this year, the company achieved total operating income of 365.9 million yuan, a year-on-year decrease of 22.23%; the net profit attributable to shareholders of the listed company was 21.3986 million yuan, a year-on-year decrease of 25.49%. Among them, during the period, the company’s dyeing and finishing fabrics achieved sales of 21.06 million meters, a year-on-year decrease of 12.98%, and the textile business achieved operating income of 161 million yuan, a year-on-year decrease of 32.04%.
Sanfangxiang stated in the announcement that since the beginning of this year, due to the continued sluggish market demand for textile consumer goods at home and abroad, my country’s textile industry has been greatly affected, and some upstream and downstream manufacturers have insufficient operating rates. . At the same time, my country’s textile exports continue to decline. The company’s spinning products are mainly made into gray cloth by downstream customers and exported directly or indirectly. Downstream orders are difficult to support normal production of the factory. In addition, the company’s compact spinning production workshop was built early and the production scale is small. After many years of operation, the energy consumption of the equipment is relatively high and the competitiveness is not strong.
“If the compact spinning production workshop continues to produce, losses will further expand.” Sanfangxiang said that after comprehensive consideration, in order to avoid further losses, the company decided to implement measures for the compact spinning production workshop. Discontinued. At the same time, the recent operations of the weaving industry are also under heavy pressure. According to the monitoring data of relevant sample companies on the China Silk City Network, the loom startup rate in Jiangsu and Zhejiang regions has recently been about 60% to 70%. Among them, the inventory of gray fabrics in water-jet and air-jet loom companies is still around 45 days, and some weaving manufacturers have already Shut down and close the door.
“This year’s textile market has been in a state of ‘not prosperous in the peak season and very weak in the off-season’. Although the output of the weaving manufacturers itself has decreased by 10% to 20% compared with the same period last year, this The inventory of gray fabrics has not been reduced. Therefore, some time ago, when the hot weather in summer came, many manufacturers gave workers holidays or took turns to take holidays according to the actual situation, but even so, the inventory pressure of enterprises has not been relieved.” An industry insider said helplessly.
Enterprises sell goods at reduced prices and sales profits decline
For a period of time, selling inventory products at low prices has It has become a last resort choice for many weaving companies.
According to a trader, they often get gray cloth from various gray cloth factories. In previous years, when they inquired about prices from gray cloth factories, the prices quoted by the gray cloth factories were generally higher than their psychological prices. high, and the room for bargaining is limited. But this year the market has reversed. When faced with the same fabric, the price quoted by the gray fabric factory is always a little lower than their expected price, and there is still room for counter-offering. This year, as long as they do not lose money, or even lose too much, many gray fabric factories will actively ship goods.
“Recently, the price of spandex yarn has increased significantly, which has affected the cost of four-way elastic. But currently, the inventory of gray fabric companies is generally very high, and everyone is eager to destock. The calls for price reduction and selling of goods are getting louder and louder than ever. If the price is raised at this time, it is tantamount to asking for trouble.” A gray cloth boss who did not want to be named told reporters that this time, the price of spandex yarn increased by 1,500 yuan/ tons, in the past, due to cost pressure, the price of gray fabrics usually increased by 0.1 yuan/meter to 0.2 yuan/meter. However, this year’s market is sluggish, and weaving companies can only choose to “stand still”.
According to market feedback, this year, many weaving companies’ sales profits per meter of gray fabric are only a few cents, and many are even shipping at breakeven or at a loss. Compared with previous years, it is common for corporate profits to fall by 50%.
The analysis of the August total prosperity index of “China·Keqiao Textile Index” shows that in August, affected by the weak market and the epidemic, the entire textile market was extremely calm, and the inventory of gray fabric market increased partially. , orders are still relatively low, and there are not many bright spots in the overall market.
Fortunately, the traditional textile market has picked up recently, and overall orders have increased significantly month-on-month. The latest monitoring report released by China Textile City shows that at present, many suppliers have begun to make frequent samples and substantial orders have increased. The foreign trade market also began to improve after gradually adapting to changes in the international situation. The active market has driven the enthusiasm of manufacturers for production. If the market outlook continues to improve, market inventories will slowly decline.
However, the report also pointed out that it is unclear whether the subsequent market can continue the recent active atmosphere. What needs to be vigilant is that if this wave of market conditions is only short-lived, the overcapacity situation will intensify again.
The traditional peak season “discount” is hard to say optimistic about the market outlook
As for the market outlook, industry insiders have different opinions.
Jiang Jianren, market information officer of China Textile City, believes that the textile and apparel market in September will show a slight upward trend month-on-month. He said: “Whether it is the domestic trade or foreign trade market, the demand for clothing still exists, and the foreign trade market will most likely be better in the fourth quarter than the third quarter. From a global perspective, if the epidemic is effectively controlled, there will be no rebound. , market demand will gradually and slowly recover. In September, it is expected that the placement of foreign trade orders will continue to recover compared with August. Market demand in East Asia, West Asia, the Middle East and Africa, and the Americas will continue to recover. Market demand in South Africa, Brazil and other places will continue to recover. , customer orders from European countries will continue to be placed.”
However, overall, it is difficult to say that optimism about the market outlook is still relatively common.
The China Filament Weaving Association recently announced the results of a questionnaire survey on key companies in the filament weaving industry: more than 80% of companies said that sales revenue in the second half of the year is expected to decrease year-on-year. ; 43% of companies said that sales revenue in the second half of the year is expected to decline by less than 20% year-on-year; 25% of companies said that the situation in the second half of the year is not optimistic, and revenue is expected to be severely damaged, with a year-on-year decline of more than 50%; only 14% of companies said , sales revenue in the second half of the year is not expected to be affected, and will be basically the same as last year or will increase slightly.
“It is impossible for the market this year to return to the same period last year. The impact of the epidemic is really too great. Some foreign brands and retailers are Orders have been cut, factories have been closed, and some companies have even gone bankrupt. The impact of the epidemic may not be recovered within half a year. In addition, my country’s textile industry itself is already in a state of oversupply, and market competition is very fierce. Therefore, It is expected that the textile market will be greatly discounted during this year’s ‘Golden Nine and Silver Ten’.” Another industry insider made such a prediction. </p
