Textile Prices Hit A New Low In Three Years

There were 16 kinds of commodities with a decrease of 5%, accounting for 23.8% of the total number of commodities monitored. The top 3 products were lint (3 mainland) (-9.69%), PTA (Hua Dong) (-7.93%) and polyester FDY (-7.74%).

Business community

Analyst Xia Ting believes that due to the issuance of direct subsidy rules, the cotton price has dropped sharply, and the cost of raw materials has been weakened. At the same time, under the influence of high inventory, high production and labor cost, the textile market will continue to weaken.

In September 17th, Xinjiang cotton target price subsidy implementation plan was released, Zheng cotton futures market responded immediately, broke through the previous low point support, plummeted for two consecutive days, and finally closed at 13110 yuan / ton limit.

Cotton spot market prices also dropped significantly, just more than 10 days, or nearly 10% decline.

At the same time, the prices of downstream cotton yarn have also dropped.

Xia Ting pointed out that although the "Kim Gu" season at the moment, but the downstream fabric manufacturers remain high inventory, careful purchase of cotton yarn, cotton yarn sales therefore blocked.

Cotton prices continue to be on the spot for cotton prices. At present, textile companies are more afraid to buy Cotton in large quantities, and cotton stocks generally only maintain 10-15 days.

As raw material support weakened, the chemical fiber market was hurt, most of which were in September.

Product market weakness, especially the whole industry chain led by PTA, the most obvious decline.

Among them, PTA (Hua Dong) ranked second in the textile sector decline, down 7.93% in September.

The PTA raw material PX market in September also fell more than 7.85%.

Looking forward to the four quarter, Xia Ting believes that the textile market will continue to weaken. The reason is: on the one hand, high inventory, high production, labor costs, tight funds and other issues have long plagued downstream textile enterprises, weak demand is still the main factor restricting prices.

On the other hand,

Cost support weakened.

The cotton price will be returned to market after Xinjiang cotton direct subsidy rules fall. The price difference between domestic and foreign countries will shrink, and the cotton market will remain weak in the future. Cotton prices will fluctuate at 14000 yuan / ton in 10-11 months, and cotton yarn will drop by 500-800 yuan / ton.

For the chemical fiber market, the supply pressure of raw materials PX will continue to increase, and the latter will still be in the weak position.

Summing up analysis, Xia Ting believes that the textile market will still be in decline in October, but taking into account the traditional demand season or postponed to October, the decline will slow down compared with September, the lowest around 900 points.