Apparel / Textiles & Accessories

As the Spring Festival is approaching, each factory is gradually entering the final stage, and the holiday arrangements have been released one after another. It is understood that the holiday time of textile enterprises this year has been extended compared with last year.

In terms of cotton yarn, the Spring Festival holiday arrangements of various textile companies have been released this year. According to statistics, this year's holiday time is more scattered than last year. Only 4% of textile companies will have a holiday before the 20th of the twelfth lunar month in 2021. In 2022, this part of the proportion has increased to twenty three%. In comparison, the Spring Festival holiday in 2020 is significantly earlier than in 2021. In 2022, 22% of enterprises plan to start construction after the tenth day of the new year, compared with only 13% last year. Most factories start work on the sixth/seventh day of the first lunar month. Delays in the start of work are also evident. In contrast, in 2021, 60% of textile companies will have a holiday within 10 days, and this part will be reduced to 29% in 2022. The proportion of vacation time of more than 15 days has increased significantly to 32%, compared with only 13% last year. Most textile companies have a vacation time of 10-15 days. Overall, the number of vacation days was significantly longer than last year. The reason is mainly due to the substantial loss of cotton yarn profits of textile enterprises. In addition, in 2021, textile enterprises have already arranged orders a year ago, and this year, the inventory of textile enterprises is relatively high. As of the 21st, the cotton yarn inventory of textile enterprises closed for 26.3 days, an increase of 1.6 days from last week. From the point of view of profits, from January to September 2021, textile enterprises have good profits, but after October, the profits shrink rapidly to a large loss. At present, the immediate loss of C32S cotton yarn profits of textile enterprises has reached nearly 2,000 yuan / Compared with the highest loss in September 2020, it is nearly a thousand yuan more. Such a loss is huge from a historical point of view, and in 2020, under the huge loss, how much the factory inventory has dropped, I believe the market is still remembered. There are many new ones with less than half of the operating rate, so it is expected that the textile enterprises will take early holidays and extend the holiday time. At present, cotton prices continue to rise, and the market is currently bullish on the cotton yarn market after the year. It is still relatively difficult for textile companies to turn losses into profits. Therefore, even when the market is generally bullish after the year, textile companies still choose to reduce production to reduce loss.

In terms of imported yarn, after several months of slow destocking and the phenomenon of some traders dropping goods at low prices for the return of funds at the end of December, the spot inventory of traders in early 2022 is generally at a low position; at this time, Indian cotton The sharp rise has driven the price of Indian cotton yarn to rise all the way. The price of Indian yarn has reached a desperate height. At the same time, Yue yarn, Indonesian yarn, and black yarn have also risen to varying degrees, making traders more reluctant to sell. The current position Lower traders or closing orders do not offer external quotations, or increase their quotations. On the other hand, the downstream weaving mills basically implement the strategy of replenishing the inventory depending on the order. Overall, the inventory of yarn raw materials is not much. However, as of today, the startup load of the main imported yarn downstream weaving mills has generally dropped significantly, and most of the weaving mills have begun to go on holiday. At present, the market has a strong bullish atmosphere after the Spring Festival, but whether the imported cotton yarn market can usher in a real bull market after the Spring Festival requires further observation of the downstream order status and the destocking of textile enterprises' finished product inventories. Drive bulk commodities into the bear market and then affect domestic cotton yarn prices, and whether this wave of replenishment will curb the downstream demand for pure cotton yarn in the short term after the Spring Festival.