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"More Work But Less Profit" &Nbsp; Rising Cotton Prices Stimulate Textile Enterprises Nerves

2010/8/17 15:30:00 51

"Do a lot of work.

profit

On the contrary, less and less.

Zhong Jun, the owner of a clothing factory in bowan Town, Liling, Hunan, has been agitated recently: Although orders are on the increase, the price of cloth raw materials is rising quietly.

The rise in the price of cloth is due to rising raw materials, especially cotton.

As of June 30th this year, the domestic 328 cotton spot index was 18309 yuan / ton, up 42.6% over the same period last year.

Cotton prices are close to their highest level in 15 years.

Like copper, cotton is also regarded as a barometer of the global economy.

Affected by this, the textile industry, which is showing signs of warming, will suffer another "cold current". The growth rate will slow down in the second half of this year.

Prices rise, store cotton throws

Explore this round

Cotton price rise

The reason is that Wang Dilong, executive vice president of Hunan Cotton Association, thinks that supply and demand are mainly affected by supply and demand. This year's surge in foreign orders stimulated textile enterprises' demand for cotton. Meanwhile, domestic cotton production is decreasing, while pportation of Xinjiang's cotton has led to pportation bottlenecks.

A clothing business owner suspected that there was speculation in hot money and even cotton business. He thought that although bad weather and planting area reduced the output of cotton, these were not enough to support the year-on-year increase in cotton prices by more than 40%.

Rising prices have prompted the country to speed up the issuance of reserve cotton. The China Cotton Reserve Management Corporation (hereinafter referred to as "cotton in storage") announced that since August 10th, through the national cotton trading market, the reserve cotton auction system has openly bid for the national cotton reserves, with a quantity of 600 thousand tons.

The dumping and storage of bulk materials will often play a role in stabilizing prices, but the price of Zhengzhou cotton futures contracts is going against the trend.

The reporter noted that the reserve price of the reserve cotton auction was 16500 yuan / ton, but the paction price mostly stood at a high level of more than 18200 yuan.

He Yuegang analysis shows that cotton prices remain strong after throwing and storing, because they are too small to meet strong market demand.

Textile enterprises

Facing cost pressures

At present, Chen cotton is running out and new cotton has not been listed yet. Because of the acceleration of the textile industry in the first half of the year, the market demand is relatively large, and many textile enterprises are in deep trouble.

Hunan province's largest textile enterprise Hunan Dongxin Group Co., Ltd. recently cotton inventory is a bit tight.

Li Xiaojian, deputy director of the group's chief executive office, revealed that as of the end of July this year, the group had stocking more than 1 tons of cotton, and there were still about 7000 tons of cotton purchase shortfall before the new cotton listing in October this year.

"Our group is also struggling to support. The raw material side is facing financial risks, and the product side is facing market risks.

We have suggested to the departments concerned that we should increase import quotas for enterprises, solve the bottleneck of Xinjiang's cotton export and give subsidies to highway cotton pportation.

Li Xiaojian said.

The head of a textile enterprise in Yueyang also told reporters that rising spot prices were very stressful for businesses.

He said that many orders were signed at the beginning of this year, and cotton prices have gone up, but the price of the products will not change during the current period, and the company will lose a lot.

In addition, Li Xiaojian said that the rising cost of labor is also a huge pressure that textile companies have to face.