On the evening of March 15, international oil prices continued to suffer heavy losses. Among them, the price of WTI crude oil once fell to 94.9 US dollars / barrel, the lowest price of Brent crude oil fell below 98 US dollars / barrel, and both fell below the key level of 100 US dollars / barrel. The lowest point since 1.

"Finally fell, anyway, it's a hope." In the circle of friends, some textile people sighed. However, whether the temporary drop in international oil prices will affect the price trend of raw materials in my country's textile industry is still unknown.

Multi-party costs are rising

According to the statistics of the General Administration of Customs, from January to February this year, my country's textile and apparel exports were US$50.2 billion, a year-on-year increase of 8.9% (in RMB, a year-on-year increase of 6.3%), of which textile exports were 24.74 billion US dollars, an increase of 11.9% (in RMB). A year-on-year increase of 9.3%), continuing the good growth trend since the fourth quarter of last year.

Although the foreign trade export has achieved a "good start", since the beginning of this year, external factors such as exchange rate fluctuations and the rebound of the epidemic have intertwined, making the operation of textile enterprises still face greater uncertainty, and the risks and challenges have increased significantly. According to data released by the National Bureau of Statistics recently, from January to February, the ex-factory prices of chemical raw materials and chemical products manufacturing increased by 20.3% year-on-year, and the purchase price of chemical raw materials increased by 17.3% year-on-year.

At present, uncertain factors have affected the supply side of the fabric industry, and the most influential one is the price trend of polyester filament. As of March 9, the cost of polymerization was about 7,495 yuan/ton, up 15.68% from before the Spring Festival, while the price of polyester filament POY150D/48F was 8,350 yuan/ton, up 7.05% from before the Spring Festival.

Qi Jinyue, an analyst at the Chemical Fiber Division of Longzhong Information Technology Co., Ltd., told the reporter of China Textile News: "Since February, affected by severe cold weather and geopolitics, international crude oil prices have risen strongly, supporting the cost of polyester raw materials. , driving the price of polyester filament to continue to rise." Although the oil price has fallen sharply, the oil price increase this year is still considerable, and the textile raw material market is still in adjustment. Qi Jinyue's analysis pointed out that under the influence of geopolitics, the current trend of international oil prices is still unclear, but from the perspective of raw materials, the cost side in March still fluctuated at a high level in the short term, and the price was relatively firm.

The fluctuating raw material market obviously affects not only polyester filament, but the price of dyes has also begun to rise recently. Affected by external factors, coupled with the limited production of dyestuffs, the supply of dyestuffs is in short supply. On March 6, the quotations of a number of dyestuff companies were raised, among which the price of disperse dyes was raised by 1,000 yuan/ton.

In addition, it is worth noting that Zhejiang Shaoxing Thermal Power Company has recently issued a notice: due to the tight supply of domestic spot coal sources and the continuous decline in power plant inventories, the price of steam may rise significantly in March, and printing and dyeing enterprises are requested to make reasonable arrangements. Production, try to avoid the peak period of high coal prices.

What is the influence of fabric enterprises?

"The impact is temporarily controllable. The risk of raw material price fluctuations has actually appeared since the second quarter of last year, so the company has a certain planning consideration for the overall trend of raw materials when making business plans at the beginning of this year." The relevant person in charge of a large textile enterprise in Jiangsu He said that in the face of a sudden sharp rise in raw material prices, although the company is difficult to predict, it has a complete procurement platform, strategic partners for raw materials and necessary reserves, which can absorb risks accordingly.

However, in the face of rising raw material prices, the ability of small and medium-sized enterprises to respond is often not as good as that of "leading" enterprises.

According to the China Keqiao Textile Index, from January to February 2022, the fabric market of China Textile City achieved a turnover of 23.328 billion yuan, a year-on-year decrease of 33.27%. The latest data released on March 14 shows that this situation has not yet eased, and the sales of apparel fabrics are still showing a trend of a slight drop in daily transactions. Among them, the transaction prices of pure cotton fabrics, polyester viscose fabrics, polyester ammonia fabrics, viscose fabrics, viscose wool fabrics, nylon cotton fabrics, and linen and viscose fabrics fell in varying amounts, driving the prices of apparel fabrics to drop slightly.

The head of the sales department of a Keqiao fabric company revealed to reporters that due to rising raw material prices and the cancellation of overseas orders, some foreign trade companies have struggled to operate. "Because the plant expired last year, several foreign trade companies we know have not renewed their leases." The person in charge admitted that the fluctuation of cost prices has a particularly obvious impact on foreign trade companies. "Now, in order to cope with the fluctuation of raw material prices, many foreign trade companies choose not to quote orders for orders delivered in the second half of the year, so as to observe subsequent exchange rate fluctuations, raw material price trends and the development of the international situation."

"The increase in raw material prices has a great impact on enterprises. In the past, the raw material market always rose in peak seasons and fell in low seasons, but this year, the prices of many raw materials have remained high. What's more difficult is that on March 13, we received a temporary stoppage from the cooperative logistics company. The company is stepping up the handling of related matters." The person in charge of a fabric company in Zhongshan, Guangzhou reluctantly told reporters.

"The most intuitive response to the instability of raw material prices is that the number of orders from clothing brands is decreasing. Although there are still many styles ordered by clothing brands, the number of orders for each style is declining. For example, a customer originally planned to place an order. 30,000 meters, but only less than 18,000 meters were purchased this year, which is relatively conservative.” Xu Xianyou, the relevant person in charge of Jiangsu Huihong Textile Import and Export Co., Ltd., said, “If consumers respond well, then customers will Additional order quantity for each style. For clothing brands, this is the safest and most efficient way, but for our fabric enterprises, the order quantity is less, the batch remains unchanged, and the labor, time and other costs we spend are basically unchanged. , which will invisibly increase the cost burden.”

Facing a dilemma whether to follow the rise or not

The situation of Huihong Textile is not accidental. In the past two years, a "butterfly effect" caused by rising raw material prices is affecting the entire textile industry chain.

Follow-up is currently the most direct response method for fabric printing and dyeing enterprises. Since March 9, some fabric printing and dyeing enterprises in Shantou, Guangdong and Shaoxing, Zhejiang have begun to adjust product prices. "Due to the continuous rise of various costs and comprehensive consideration of various factors, the company decided to increase the price of knitted fabrics by 0.5 yuan/meter and woven fabrics by 0.1 yuan/meter." "Due to the sharp rise in the prices of raw materials and energy, the processing cost has been increased. Climbing, the factory decided to increase the order of chemical fiber products by 500 yuan / ton from March 10."

"We have negotiated with major customers on the rising price of raw materials, and adjusted the sales prices of some products." Xu Xianyou pointed out that price increases are inevitable, but the company is also gradually changing the product structure. "For example, the development of 1.0, 2.0, and 2.5 generation products. The fabric components of these products are generally the same, but the details are different, resulting in different prices, allowing downstream enterprises to have more flexible choices."

However, there are still some fabric companies who are generally very cautious about raising prices. First of all, they still consider tightening their belts and saving costs. "We are very cautious about raising prices for long-term hot-selling fabrics. The current competitive pressure in the entire industry is still very strong, and the market is still in a situation of oversupply. Once the price of products increases, buyers may choose other companies." The person in charge of the company who wished to remain anonymous told reporters.

It is still too early to predict when this year's "price hike" of raw materials will usher in an inflection point. Industry insiders said that this round of price increases may last for a long time. For fabric companies, the most fundamental thing is to continue to upgrade products and technologies to enhance their core competitiveness. When supported by the "hard power" of products, coupled with continuous investment in branding, marketing, services, etc., no matter how the environment changes, it can firmly grasp the hearts of downstream brands.

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