Weak Market Demand And Active Adjustment Of Enterprises

Over the past month, domestic and foreign cotton futures and spot prices have risen sharply, and the yarn market has improved as a whole. The price of high counts pure cotton yarn is still declining, narrowing from last month, sluggish downstream demand for yarn dyed fabrics, insufficient orders, low utilization of capacity and stable price.

　　 Raw material Market

Since mid May 2020, domestic and foreign cotton futures prices have gone up, and domestic cotton spot prices have risen. In June 12th, the average spot price of domestic 3128B grade cotton was 12220 yuan / ton, up 300 yuan / ton in the same period last month, or a slight increase. According to the survey, nearly half of the raw materials inventory of textile enterprises in a month or so, raw material purchase intention is weak, with rigid demand. The yarn market has improved as compared with last month, the sales of regular cotton yarn are relatively good, and the high count pure cotton yarn trade is still light. Before the end of May, the price of high count pure cotton yarn remained stable. In June, the price declined slightly, narrowing from last month. Because downstream demand is insufficient, raw materials continue to rise, the profit margins of textile enterprises are continuously compressed. Some enterprises are already on the edge of losses, most of them choose to go cheap, and the stock pressure is still undiminished.

Yarn dyed fabric Market

Since mid May, the epidemic situation in foreign countries has been controlled. Many countries have gradually lifted the state of emergency or relaxed border control and actively restored the economy. Foreign customers' enquiries increased more than last month, mainly in small orders. Most of the foreign trade orders were less than half of the same period last year, and export did not improve significantly. The inventory and revenue pressure were not improved significantly.

It is understood that the capacity utilization rate of the survey enterprises has remained low, averaging around 50%. Because of the slow recovery of foreign markets, more than half of the inventory of the survey enterprises is in a month or so. In order to control inventory, enterprises arrange production reasonably, so as to ensure continuous opening and stabilize employees. In terms of price, although the domestic demand is getting warmer, the atmosphere of the traditional off-season is becoming more and more strong. The demand for the terminal market continues to be weak.

With regard to the current situation, the enterprises of dyed fabrics are actively responding. If some enterprises change their production masks, they are almost actively exploring the domestic market. With the help of the network platform, innovative design and marketing mode, the online product promotion and sales will be increased to ease the situation and wait for the market to improve.

Outlook for the future

Recently, the government work report, adopted at the three session of the thirteen National People's Congress, stressed the need to co-ordinate the work of epidemic prevention and control and economic and social development. Under the premise of normalization of epidemic prevention and control, we must adhere to the general keynote of keeping steady and strive for progress, increase the work of "six guarantees" and "six stability", put the "steady employment" and "protect the people's livelihood" in the first place, and firmly implement the strategy of expanding domestic demand. 。 The report has brought positive information to enterprises, and business confidence has been restored. In addition, the Canton Fair, known as China's first exhibition, will be held online next week. Most of the survey companies expect this. In view of the market outlook, it is still expected that the domestic and international consumer demand will recover in a comprehensive recovery. The investigation enterprises will actively adjust the market situation, and hope that the relevant government agencies will implement relevant policies as soon as possible and increase support efforts to help enterprises relieve their difficulties and ease the pressure of enterprises.

(the above contents and data are from a sample survey of yarn dyed enterprises, for reference only).