Yi’s orders have shrunk severely, gray fabric inventory has been backlogged again, and the “off-season” market is quietly coming!
“We agreed a year ago that an order of 1.2 million meters of silk spinning would start in February after the new year, but now the order has dropped sharply and is not even 100,000 meters.” One trader said with regret and disappointment.
When it comes to the impact of the pneumonia epidemic on the textile market, the most direct one is the continuous postponement of the start of work and the resumption of the market. However, this impact is short-lived and visible. In the end, textile companies everywhere will usher in the resumption of production, but for textile orders The influence began to fade away.
At the beginning of the resumption of work, due to the concentrated release of the backlog of orders from the previous year, the entire textile market showed gratifying peak season conditions. However, as follow-up orders have obviously followed up, and orders have continued to be reduced and canceled, the durability of this market has begun to be greatly reduced. Today, there are various pessimistic and conservative voices in the market.
Orders are reduced or canceled, and the market is worrying
The order dropped from one million meters to less than 100,000. This is not a simple discount, but is basically equivalent to the cancellation of the order. In fact, this kind of situation is already common in the current textile market, and it is even becoming more and more serious. In particular, the entire international crude oil market has been experiencing violent fluctuations recently, the global economic situation is not optimistic, and the pneumonia epidemic is raging in Europe and the United States. The demand for textile fabrics is restricted, and the entire textile and apparel market generally lacks confidence in the market outlook, so orders are placed cautiously and conservatively.
According to a salesperson from a clothing foreign trade company, they purchase fabrics from China and then export them to garment processing factories in Vietnam. Finally, the finished garments are exported to the European market. In other words, their end customers are actually clothing companies from Europe and the United States, and among their large customers are many Italian clothing brands. However, as the epidemic continues to ferment in Europe, many of their orders have been cancelled, especially in Italy, which has been in a state of lockdown.
In addition, some fashion exhibitions and clothing shows have to be postponed, and those clothing brands that place orders based on fashion trends are bound to postpone or reduce the number of orders.
Reduced orders for conventional varieties may exacerbate overcapacity
“Our factory produces satin, polyester taffeta, pongee and other varieties. The current situation is not as good as last year. The better orders on hand are from old customers, and the quantity is only tens of thousands of meters, with the highest number of more than ten 10,000 meters per month. You must know that last year their volume was twice what it is now, and the current market is really not good,” said a person in charge of a weaving company.
Conventional varieties have always been the most popular products on the market in the past, but under the current market conditions, they have also become the varieties with the largest decline. Sales volume has gone down, but it is difficult for weaving factories that have restored production capacity to reduce production and stop work at will. Bite-the-head production may be the state of most weaving factories.
However, the growing inventory has encountered a sharp drop in raw material prices, and those high inventories continue to depreciate as raw material prices drop. And soon, the market will be filled with a mixture of gray fabrics produced from high-priced raw materials and gray fabrics produced from low-priced raw materials. Whether to price based on cost or place orders based on market conditions may trouble many companies, especially those whose original gray fabric profits are only a few cents per meter.
It is the consensus of most people that the textile market is currently in an off-season. Of course, this situation is inseparable from the impact of the rampant pneumonia epidemic and the weakening global economic situation. Although there is no clear answer as to how long this impact will last, we textile people do not need to be overly pessimistic. The market is now light and not busy. We can take the opportunity to develop sample fabrics and visit customers.
In fact, many companies in the market have taken action. They carefully study customer needs, accurately match them, and send out samples of fabrics suitable for customers; or they take seriously customers who have not yet placed orders, although they have several or a dozen samples every time. I had to find fabric samples and get quotes, but I still responded patiently and proactively. When the current epidemic situation passes, customers will eventually place more or less orders.
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