The current in-depth research report on China's cotton textile market

Recently, the China Textile Industry Association sent a total of 25 people, comprising a total of 12 research groups, each visit to Jiangsu, Zhejiang, Shandong, Henan, Fujian, Jiangxi, Hubei, Xinjiang and other eight provinces and regions visited the site 74 cotton Textile enterprises and 9 cotton textile industry clusters . The survey on the cotton textile industry cluster and the overall situation of the enterprise, raw material security, market situation, comprehensive cost and benefit, transformation and upgrading , and brand building were conducted.

The opening situation is good. Orders increase after the Spring Festival.

The company involved in the survey involved a spinning scale of approximately 18.67 million spindles and a looms of 22,000. According to the company's report, the first quarter of 2017 started well. According to the survey company table, 93% of the companies started to approach 100% at 8:00 am after the Spring Festival holiday.

After the Spring Festival holiday, the production situation is stable. Most enterprises are more optimistic about this year's situation, and products are more cautious and optimistic than single companies. Many enterprises have adapted to the short-single and small orders, the market demand for shortened delivery cycles, the low level of product inventory and the reduction of bad debt risk. Orders after the Spring Festival increased by 5% to 10% year-on-year, basically 2-3 months, and some yarn-dyed fabric production orders have continued until August. Home textiles and clothing orders are concentrated to the more advantageous enterprises with a complete industrial chain. Under the circumstances that the orders are insufficiently reflected in the industry, the number of orders of enterprises has not decreased.

More prudent investment is more rational

In the environment where market demand is still sluggish, companies are more cautious in investing in capacity scale, and expansion is more rational. 28% of companies have investment intentions, and 20% of companies have or plan to transfer industries . The enthusiasm for attracting investment from spinning companies in Xinjiang is still high.

Some enterprises with large capital pressure said that while stabilizing the production scale, they will put more energy and funds into the research and development of products, constantly change product varieties, innovate constantly, and steadily and steadily to meet customer needs and improve the competitiveness of enterprise products market.

Raw material stocks are lower than non-cotton fibers

At present, the use of raw materials in enterprises basically follows the principle of using and buying. Whether it is cotton or non-cotton fiber, there is no large inventory. The main reason is to avoid the risks caused by price fluctuations, reduce the amount of funds used, and ensure the liquidity of funds. For the procurement and inventory of raw materials, there are mainly the following factors:

Companies using non-cotton fibers are on the rise. In 2016, the use of non-cotton fiber in the cotton textile industry was basically the same as that of the previous year, at 12.63 million tons. More and more companies are beginning to experiment with non-cotton fibers. According to the survey, companies that use more than 50% of non-cotton fibers have shown a growing trend. Most companies say they will continue to increase the use of non-cotton fibers. Companies that have consistently produced pure cotton products have also said that they will adapt to the market trend of increasing the proportion of non-cotton products, and try to use differentiated fibers to achieve fiber diversification.

Reserve cotton is put on stable market, and the issuance of quotas is louder. In 2016, the national cotton output was 4.94 million tons, of which Xinjiang's cotton output was 3.95 million tons, accounting for about 80%. At present, Xinjiang cotton textile enterprises mainly use cotton reserves and served, and a small amount of imported cotton in use. The release of reserve cotton has played a positive role in maintaining the stability of the cotton market. It is understood that the Xinjiang yarn production in 2016 is about 1.1 million tons, of which cotton blended yarn and chemical fiber yarn account for about 20%. The cotton conversion rate increased from 15% in the previous year to 20% in 2016. Since the pilot price of cotton in Xinjiang has been implemented for three years, the price difference between cotton at home and abroad has narrowed. Due to the prominent structural contradiction of cotton, enterprises are eager to increase the quota for cotton imports.

Reduce imports of cotton yarn year, with domestic yarn quality advantage. Since the pilot price of cotton in Xinjiang has been implemented for three years, the price difference between cotton at home and abroad has narrowed. In 2016, the price difference between domestic and foreign cotton was 1,500 yuan per ton. The difference between domestic and foreign cotton yarns was about 300 yuan per ton, which was in an upside down state for a period of time. Presenting a decreasing trend. In 2016, the total import of cotton yarn was 1.97 million tons, although the year-on-year decrease was 16%, but the quantity was still large, equivalent to the production capacity of more than 10 million spindles, and the attention was still high. The domestic weaving company said that when the yarn price difference between domestic and foreign yarns is less than 500 yuan per ton, considering the order cycle and quality stability factors, it will choose to purchase domestic yarn.

The market is stable and the price is poor.

A stable market is a consensus of research companies. Cotton Association track line from business situation, the 2016 total annual capacity of 50% of the total industry companies pooled data show that cotton textile enterprises the main business revenue grew 4.4%, gross profit increased by 7.1%, after a recent wash after surviving brand enterprises, with the transition times, improve R & D innovation capability, enhance the comprehensive competitiveness levels, operating conditions gradually improved. The small and medium-sized enterprises that visited visited that although the corporate profits in 2016 increased year-on-year, the growth rate was limited, slightly lower than the growth rate of sales revenue.

After the Spring Festival of 2017, despite the smooth sales, the company's profits are relatively meager, the market situation is still fragile, and some companies are still losing money. In the survey, the company reported that although the price of raw materials rose in stages, it was not demand-driven, which was reflected in the fact that cotton yarns rose less than raw materials, and the prices of cloth products did not increase. The price of products in the industrial chain was not well transmitted. Recently, when the viscose staple fiber prices fell, and fell more than rayon raw materials decline.

Cost has regional differences, financing problems are outstanding

Under normal circumstances, the cost of raw materials for spinning and weaving accounts for 72% to 65% of the total cost, respectively, and the cost of labor and electricity accounts for about 10%. For example, in the case of a company's cotton carding 40 yarns, the processing cost of producing one ton of yarn is more than 7,000 yuan, and the profit per ton of yarn is only 200 yuan.

In terms of labor costs, the labor cost of the coastal and central regions is more than 500 yuan per ton. In terms of electricity cost, the electricity cost of the surveyed area ranges from 0.28 yuan to 0.72 yuan per kWh. The electricity cost per ton of yarn in Xinjiang is lower than that of mainland enterprises by about 1,000 yuan per ton. In terms of other costs, due to the large investment in fixed assets of cotton textile enterprises and high liquidity requirements, the current financial environment makes the cotton textile industry difficult to borrow, and the loan interest rate is high. The problem of financing difficulties and financing is becoming more and more prominent, and the cost of finance and taxes is high. The proportion is increasing. Enterprises with more loans will increase their loan interest rates by 10% to 20%, making it more difficult for companies to make profits.

In recent years, cotton textile enterprises have actively taken measures to “reduce costs” despite the continuous increase in production and operation costs. In the production cost, the comprehensive competitiveness is improved by increasing the operating rate of equipment, increasing the added value of products, increasing labor productivity, saving energy and reducing consumption, and reducing financial costs.

Transformation and upgrading show new weather

The survey found that equipment renewal, technological transformation, product innovation and quality improvement are the main ways for cotton textile enterprises to transform and upgrade.

Most enterprises in terms of equipment mainly to elimination of outdated equipment (equipment before 2007), the new high efficiency, improve quality, less labor willingness to strengthen intelligence equipment. For example, Weiqiao Textile, Jiangsu Dasheng and other enterprises have taken the lead in building the most advanced spinning production line based on domestically produced equipment.

Technological innovation and energy saving measures continued to deepen. The old-fashioned woven looms, rapier looms, dyeing and finishing equipment with high energy consumption and high water consumption are gradually eliminated; the replacement of energy-consuming motors and fans, and the addition of frequency conversion devices save electricity, steam and water.

Some cotton textile gathering areas give full play to the advantages of raw materials, labor and other resources, accelerate industrial agglomeration, expand the brand influence of the cluster, increase investment in product research and development, and improve the level of refined management, and further develop high-end customers.

In terms of internal management, many high-quality enterprises have accelerated their work in the ERP information management system and integration. The application of production bar code and supporting management software has strengthened the internal management of the enterprise, and the management efficiency has been significantly improved. Electronic business platform came into being, for the market demand, the business model of online and offline transactions over the Internet gradually play a role in the new logistics approach is gradually taking shape.

Actively adjust product structure, brand awareness is gradually enhanced

Investigating the different product varieties of enterprises in various regions, the characteristics of non-cotton products increased, varieties were differentiated, and product grades were developed to medium and high-end. In the development of ideas, from the pursuit of quantity to the pursuit of quality and the pursuit of high value-added. It is also agreed that although the gauze products are intermediate products, the brand effect can still add value to the enterprise.

From the perspective of yarn fiber raw materials, the proportion of non-cotton yarns increased, and the conventional cotton-blend yarns such as polyester-cotton and cotton did not increase much. From the yarn count, the yarns of the ring-spun yarns of 40S or more in the research enterprises accounted for the majority, in order to avoid Xinjiang imported yarn and yarn competition, taking dislocation competition, such as increased air spinning yarns 32 market; some enterprises to improve product value-added principle, to market demand as the starting point, improve product quality, focus on the development of new products; from spinning way to see, Siro spinning, compact spinning accounting is showing improvement trends; use of the yarn from the point of view, high-end knitting yarn, dyed yarn has increased.

Among the researched weaving enterprises, pure cotton fabrics still occupy an absolute advantage, and the application of new materials and new technologies is more and more extensive. Some enterprises that have little advantage in pure cotton products are more inclined to adapt to the market development trend and increase differentiated products, with more than 100 varieties.

Enterprises in some regions changed the yarn structure and fabric style. The investment in technological transformation accounted for more than 10% of the sales revenue. The structure and quality of the products were quickly adjusted, which made the yarn category more abundant and the fabric style more diversified. Develop and promote with downstream customers, working on design, brand, awards and added value.

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