Recently, cotton textile sales in Shandong Dezhou textile enterprises were sluggish, inventory increased and operating rate declined, the whole cotton spinning industry was in a state of loss, and some enterprises were at the edge of shutting down production.

Yarn price drop and stock increase

Cotton spinning enterprises insist on sticking to their teeth

Dezhou, Shandong, is both a major cotton producer and an important textile base in the country. There are 415 textile enterprises in the city, with 5 million production scale and 10 employees.

For cotton spinning enterprises, 2010 and 2011 are two days of ice and fire.

2010 is the best day for the past ten years. Because cotton prices and yarn prices continue to rise, lint is stored in warehouses, even if it is not spun into yarn, it can earn a lot of money in a few months.

The owners of textile enterprises are all too happy to get lip service, so this year before and after the Spring Festival, they bought a lot of lint in the storehouse, and there were less two or three months' inventory and five or six months' inventory.

Unexpectedly, cotton prices and yarn prices continued to decline rapidly after mid March, and the production and operation of textile enterprises were in a predicament.

In 5~7 months, 80% of the small and medium-sized cotton textile enterprises in Dezhou were in a state of stop production or limited production.

8~9 months, with cotton prices stabilized and picked up, sales of cotton yarn have improved.

Entering the October, the price of yarn fell again with the cotton price. At present, the price of the 32 pure cotton yarn mainstream traded at about 26500 yuan / ton, the higher price was 27500 yuan / ton, and the price dropped 1500 yuan / ton in one month, which was 13000 yuan / ton lower than the highest price at the end of February this year, a decrease of 33%.

Wucheng Huayi Group is a comprehensive production enterprise integrating cotton processing, textile and oil extraction.

Meng Qingshun, chairman of the group, counted the accounts for the journalists: Taking 32 pure cotton yarns as an example, the price of lint was 19000 yuan / ton. According to the yarn yield of 1 to 1.10, the cost of producing 1 tons of cotton yarn was 21000 yuan, plus 7500 yuan per ton of labor, electricity and management fees, and the cost was 28500 yuan / ton, while the selling price was only 27000 yuan / ton, with a loss of 1500 yuan.

This is based on the price of yarn, and if the price of yarn falls, there will be more losses.

Meng Qingshun said that due to the relatively low demand in the downstream, spinning mill inventories have been increasing, and many mills have been working on a half scale basis and are afraid to stop production, mainly in order to retain workers and maintain some old customers.

Once the production is stopped, the recruits will work harder when they start again.

It is understood that due to the decline in downstream orders, cotton yarn sales sluggish, cotton spinning enterprises continue to increase inventories, capital turnover difficulties.

At present, small and medium-sized cotton textile enterprises in Dezhou mainly consist of short list, small list, quick list, long single and large number, and the overall operating rate is less than 70%.

With the increase of cotton yarn inventory, limited production enterprises will increase, and some enterprises may even shut down.

Developing new products and eliminating backward products

Structural adjustment is imperative.

At present, the whole cotton industry scenario is even more severe than the financial crisis in 2008.

A batch of cotton spinning enterprises had to stop production, and the new round of reshuffle was inevitable.

In recent years, textile enterprises, represented by Lingxian County Hengfeng, Fuhua and Baoding, are actively developing new cotton fibers with high added value.

At present, Lingxian County has more than 30 new fiber textile enterprises above Designated Size, and its capacity accounts for 30% of the same industry in the whole country. The products cover more than 90% varieties in the market.

The average profit rate of new fiber products is over 10%, which is 2~4 times that of traditional pure cotton products.

Owing to the extensive use of new fibers, the proportion of cotton used by these enterprises has dropped to below 20%.

Over the years, domestic textile enterprises have occupied the market and developed rapidly with the advantage of lower raw material cost and labor cost. With the rising cost of raw cotton and labor costs in China, this advantage will gradually disappear.

Industry experts believe that at present, the domestic textile industry is overcapacity, the textile industry must carry out technological pformation and structural adjustment, eliminate backward production capacity, make products from low-grade, extensive to high-grade, fine pformation, and actively research and development of high added value non cotton new fibers, reduce the proportion of cotton, reduce the dependence on cotton.