The worst times in the cotton textile industry have not arrived yet

"The most difficult period in the cotton spinning industry has not yet arrived."

Although cotton prices fell again and again, senior industry researcher Wang Qiang, editor-in-chief of First Textiles, was still pessimistic about the outlook of the industry.

On November 22, the national cotton price index B (standard cotton stock of grade 328) closed at 19,714 yuan/ton, down by 21 yuan/ton from the previous trading day. It is widely expected by industry insiders that due to the double bottoming of storage mechanism and cost price, there is not much room for cotton prices to continue to decline. However, the lack of terminal demand means that the next 3-6 months will be the most difficult period for the cotton spinning industry.

However, people in the industry also pointed out that if manufacturers at the end of the year press for inventory pressure and increase sales efforts, domestic textile retail is expected to return to normal within a short time.

The price of cotton continues to fall is not enough. At this time last year, cotton prices are still rushing to the 30,000 yuan / ton track on the strong upward. This hot situation is in stark contrast to the current cotton spinning raw material market.

According to the monthly report on China's cotton price index, although October was the peak period for the seed cotton sales, the number of new cotton products increased significantly, but the cotton price was down. At the end of October, the National Cotton 328 Index closed at 19,409 yuan/ton, down 563 yuan from the end of September, with a 2.8% drop. The monthly average price was 19,716 yuan/ton, down by 16 yuan from the previous month, or 0.1%.

Wang Qiang said that the current spot price of cotton has been lower than the national temporary reserve price, the market transactions are still light, so the deposit has gradually become the main channel for business operations. In this context, he expects cotton prices to stabilize at low levels.

According to another estimate, the gross weight of third-grade lint cotton in southern Xinjiang this year is about RMB 20,000-20,300/ton, and that of Shandong fourth-grade lint is 17500-18400 yuan/ton. As far as the cost factor is concerned, Wang Qianjin also believes that "there is no room for further decline in cotton prices."

Both internal and external demand are weak Although there is little room for a drop in cotton prices, Wang Qianjin pointed out: “The data of the downstream cotton spinning industry is not optimistic. The most difficult period of the industry has yet to come.”

The 110th session of the China Guangdong Import and Export Commodities Trade Fair that recently concluded fully reflected the sluggish external demand. According to statistics, the transaction value of the Canton Fair in 2011 increased by 8.3%, 13.4 percentage points lower than the 21.7% increase in the previous year; Europe and the United States purchasing The actual turnover of the business dropped by 19% and 24% respectively. Among them, 6

Within the month, the percentage of short-term single accounts for 88%. All of these data indicate that the economic slowdown in Europe and the United States will cause a serious drag on China’s export situation.

The participating textile and garment companies even believe that the current situation is even worse than when the 2008 financial crisis.

Consumer demand in the domestic market is also not optimistic. According to statistics from China Business Federation and China National Business Information Center, 10

The monthly retail sales volume and volume growth of apparel products both showed a slowing trend. The retail sales of 100 large-scale retail enterprises increased by 16.73% year-on-year, and the growth rate fell 15.12 and 11.86 respectively year-on-year and year-on-year respectively.

Percentage points; retail sales decreased by 5.82% year-on-year, and the growth rate decreased by 8.02 and 18.06 percentage points year-on-month and year-on-year respectively.

“The Canton Fair data is a precursor, and the impact of the declining growth rate of orders will appear in the next 3-6 months,” Wang Wangjin believes. By then, it will be the most difficult period in the industry.

However, it is worth noting that Everbright Securities recently released a report that the decline in sales in October has a certain relationship with the "warm winter" and the mall's weak promotional efforts, with the approaching of "Spring Festival" and other festivals and the internal needs of businesses to inventory , Discount activities and efforts will be at 12

The month and the first quarter of next year have seen marked improvement. By then, the growth of domestic apparel retail sales is expected to return to normal.