To Lose Money In Weaving, &Nbsp; Spinning Enterprises To Consider Shutting Down Production.

1/3 small Loom factory "holiday"

"If the price of raw materials increases again, we may also have to take a vacation."

Cheng Chuanwang, the boss of Yancheng City Xing Long Yuan weaving factory, sighed at the end of the phone.

"Holiday" is a euphemistic expression of "stop production" by many small and medium-sized textile enterprises.

About 1/3 of the small cloth factories in Northern Jiangsu known by Cheng Chuanwang now have a "holiday".

This is not the worst, and about 1/5 of the small factories have simply started selling machines.

Cheng Chuanwang's factory has been in operation for 8 years, and the scale is relatively large. But now he is obviously unable to sustain it.

"In the past few years, the price of cotton yarn has not gone up, but this time it has gone a little too far."

Taking the 32 degree cotton yarn with a large amount of weaving in local cotton textile enterprises as an example, last year's price was still 18 thousand yuan per ton. This year, it has risen to 36 thousand yuan per ton and has increased 1 times.

For many small weaving factories, the cost of raw materials accounts for about 85% of its production cost, and the substantial increase in the price of cotton yarn means that the cost of weaving mills is almost synchronous.

The price of chemical fiber is rising with the tide.

With the rise of cotton prices, many garment enterprises reduce cotton consumption in the production process, and turn to increase the amount of chemical fiber.

The move also triggered a chain reaction, driving the price of chemical fiber products.

By the middle of October, the chemical fiber products headed by polyester staple fiber had risen from 9600 yuan per ton to 13000 yuan per ton, or up to 30%.

Although the price of chemical fiber products has increased obviously, the price advantage is still obvious under the contrast of the high cotton prices.

According to the insiders, the price difference between cotton and polyester staple fiber has now expanded to 10000 yuan, and from a historical point of view, the normal price difference should be between 3000 yuan and 4000 yuan per ton.

Such a huge price difference means that the amount of polyester instead of cotton will gradually increase.

"Before the price adjustment of chemical fiber products, most of them are affected by the fluctuation of oil prices, and the price of chemical fiber is following the cotton price."

The general manager of a clothing enterprise once told the media that "there are fewer pure cotton products in the market now, and even if there is a high proportion of Fujian casual wear, there are about 20% of the chemical fiber components."

It costs two or three cents per woven rice cloth.

The price of raw materials has gone up, the wages of workers are increasing, and the price of grey cloth produced by enterprises can not increase at the same time.

The profit margins of small weaving mills were continuously squeezed. Until September this year, as the price of raw materials went up further, they were squeezed to the profit threshold. Some enterprises began to face the situation of commencement or loss.

The boss of a weaving factory in Chongqing said, "before I made a white cloth of one meter, I could earn 1 cents. Now I make a white rice cloth, and I lose one to two cents."

The boss even said that he had planned to completely shut down the cotton yarn after being used up and sell the machine.

Cheng Chuanwang also told the author: "now weave a rice cloth for about two to 30 Fen loss."

But he is still trying to rely on the accumulation of some previous businesses, hoping to keep up with the price surges of raw materials.

"What are the workers going to do when they get off? They always want to wait until the price of raw materials is reduced."

Or will cause industry shuffle.

But some analysts pointed out that cotton prices in the short term will be hard to come down.

On the one hand, due to the low cotton price in 2008, cotton growers' confidence was frustrated and the planting area was reduced, resulting in imbalance between supply and demand. On the other hand, last year, cotton production in Xinjiang and other main cotton producing areas decreased by nearly 1/4 due to climate disasters and other reasons, which further aggravated the contradiction between supply and demand.

At the same time, the international cotton price is also on the rise, while cotton exporters such as India have suspended cotton exports, and cotton prices will remain at a high level for some time to come.

Before the decline of cotton prices, for some strong textile enterprises, they can rely on abundant inventory to cope with the current pressure of rising prices or directly develop their cotton planting base, and for small and medium-sized textile enterprises with tight funds, they can only choose to cut production or stop production.

"An increase in cotton prices will accelerate the reorganization and integration of the textile industry, and increase the concentration of the industry. A number of small and medium-sized enterprises will be eliminated. This is also the general trend of industrial readjustment," an expert from the Ministry of agriculture's Rural Economic Research Center said in an interview recently.

It is reported that there are already small and medium enterprises to consider the conversion of raw materials prices are not so sensitive intermediate processing links.

Price rises in consumer market

As winter approaches, the impact of rising prices of cotton and chemical fiber products has begun to be pmitted to the downstream consumer market.

The prices of winter clothing, quilts and other related products have been raised.

Bosideng's management recently said that it plans to increase its price by 15% to 20% in the fiscal year ending March 2011 to offset its higher production costs.

Lining, the sportswear brand, also claims that the retail price of clothing products will increase by 17.9% in the fourth quarter of this year and the average retail price of footwear will increase by 7.8%.

And a lot of bedding prices also quietly up-regulated, a bedding salesman said that last year 180 yuan, 190 yuan of the cover, now to sell 220 yuan, 230 yuan.

Author's notes

Capital stirred our lives.

"Garlic you ruthless" "beans you play" "Jiang Tai Gong" "sugar Gao Zong" "Ping what"...

Every time we go to a vegetable market or a supermarket to buy groceries and look at the price tag, we will find that the prices of agricultural products are constantly rising, and our food basket is also getting heavier and heavier.

In fact, the prices of these vegetables and fruits not only appear on the price tags of supermarkets, but also occupy a place in the capital market.

Moreover, the market prices of agricultural products in the futures market always start a great wave before the price tag changes in supermarkets.

In a sense, the capital market is sometimes like a prophet in the consumer market.