A few days ago, the Jiangsu Peixian Textile Association issued a joint convention on production restriction: In view of the current impact of the epidemic on textile exports, the imbalance of supply and demand, and the high price of raw materials, vicious bidding has occurred in yarn sales. In order to alleviate market pressure, after joint discussion and unanimous approval by all member units, it was decided that starting from June 20, each company will limit production by 30% to 50% based on its own operating conditions.
The COVID-19 epidemic and the traditional textile off-season have put greater pressure on Peixian textile companies to accumulate inventory. In order to alleviate inventory and Due to financial pressure, many textile companies are shipping goods at low prices, resulting in price wars and vicious competition in the market. As a joint organization of textile companies, local associations intervened and issued this joint convention, which also reflects the current survival of textile companies. Dilemma.
Pei County is located in the north of Xuzhou City, Jiangsu Province. It is a major cotton yarn production county in my country and an important cotton yarn and viscose yarn. As a production base, the county has 510 textile enterprises, with 1.76 million open-end spinning spindles and an annual output of 800,000 tons of viscose yarn.
In recent years, Peixian County has adopted “prominent planning guidance, optimized development environment, promoted resource integration, eliminated backward production capacity, and exerted “Association Role” and other measures to vigorously promote the development of the textile industry. In 2017, Peixian County was awarded the title of “China’s Viscose Yarn Production Base County”.
In order to coordinate the entire industry chain, the Peixian Textile Association has taken the initiative to work with downstream companies to cultivate new markets. Peixian County has planned a 20-square-kilometer China (Huaihai) green textile industry. Xincheng plans to build a world-class lyocell fiber technology academician workstation and R&D center and a domestic textile university to form a new textile material base integrating industry, academia and research, and gradually build the largest and world-class new textile materials and high-quality products in China. It is a production and trading center for yarn and high-end fabrics, driving the transformation and upgrading of the entire textile industry, and injecting new and powerful impetus into building the most competitive characteristic industrial base in the Huaihai Economic Zone.
As the traditional off-season atmosphere deepens, the market conditions further decline. Many textile companies have continued to increase their inventories due to insufficient orders. . It is understood that the current operating rate of local viscose yarn enterprises in Peixian County has dropped to 78%. Some large enterprises have reduced production by 10% to 30%, and some enterprises have stable operation but have adjusted to produce fine yarn.
Currently, it is a common phenomenon for enterprises to reduce orders by more than 50%. The most direct impact of order reduction is the growth of inventory. In order to prevent all working capital from turning into raw materials, finished products, and workers’ wages, most textile companies have changed their early high operating rates and began to significantly lower their operating rates to 80%, 50%, and some even less than 20%.
It is understood that not many local textile companies in Peixian County have Dragon Boat Festival holidays, but this does not mean that workers There are no holidays. In fact, due to production cuts, many spinning mill workers have entered a state of rotation. Some companies also said that the current half-start state is no different from a holiday. If there are orders, we will start working, and if there are no orders, we will take turns to take vacations. Although there are hopes for August, the expectation of a retaliatory rebound in orders is still not strong. At present, the “downgrade” phenomenon of domestic cotton yarn and gray fabric is relatively common. Many companies choose to abandon low-profit export orders, step up domestic sales, and proactively lower product grades to ensure that their products are diversified to meet customer needs.
Peixian spinning enterprises stated that there has been an increase in inquiries and sample proofing for European orders recently, and orders from Turkey and other countries have also arrived at the factory. However, foreign trade orders still fail to increase in volume. In addition, domestic sales orders have returned to the off-season and have become sparse and continue to weaken. Orders are “more monks and less meat”. Enterprises’ processing profits are meager and production is loss-making. The market status quo has led to enterprises’ low enthusiasm for processing and downturn. Textile companies are forced to limit production or even take holidays during the off-season. </p
