Currently, in some key provinces across the country, especially coastal economic zones with developed manufacturing industries, power cuts and production shutdowns are plaguing many factories. The embarrassment caused by this is even more obvious for the textile industry.
The rise in dyeing costs spreads virally
The “delivery capacity” of the textile market has been greatly reduced
On September 24, as soon as the A-share market opened, the light manufacturing, energy and power sectors went crazy. The direct cause of the surge in these two sectors is power and production restrictions. Jiangsu and Zhejiang provinces are China’s printing and dyeing centers. Shaoxing alone accounts for half of Zhejiang Province’s printing and dyeing production capacity. Once the Shaoxing printing and dyeing factory stops working, it is equivalent to one-third of the country’s printing and dyeing production capacity going out of business.
When supply-side production capacity is severely restricted, raw material prices will rise sharply. Changshu Printing and Dyeing Chamber of Commerce in Jiangsu Province issued the “Notice of Adjustment of Dyeing Fees”, requiring member companies to uniformly increase printing and dyeing fees by no less than 1,000 yuan/ton starting from October 1.
The Tongxiang Sweater Dyeing and Finishing Chamber of Commerce in Zhejiang Province issued the “Letter on Adjusting the Skein Dyeing and Processing Fees”, requiring printing and dyeing The processing fee will be increased by 500 yuan/ton.
The price increase from the printing and dyeing end is spreading widely! From the current point of view, the subsequent increase in dyeing fees in the entire Jiangsu and Zhejiang regions is obvious. In the entire printing and dyeing industry chain, textile factories are in an awkward position. The increase in dyeing fees is not easy for textile traders to accept. After all, the profits of finished fabrics are generally high. They are all around 10%. The direct profit of many fabrics is less than 1 yuan/meter. An increase in dyeing fees eats up 10%-20% of the profit.
Similarly, catalyzed by the production limit and suspension measures, polyester filament also launched a new round of price increases on the 27th.
Textile factories currently face three major problems:
1. The price of upstream raw materials has increased
2. The product delivery time has been extended and uncertainty has increased, which directly leads to the textile mill’s own order production. Big changes in plans.
3. Self-limited power supply reduces the start-up time, resulting in an obvious shortage of available production capacity.
The uncertainty of product supply is coupled with the uncertainty of its own startup time. The direct consequence is that the “delivery capacity” is greatly reduced!
Different from the adjustment in the chemical industry last year
This dual control is reminiscent of the chemical industry in the second half of last year. Under strict environmental protection policies, a large number of high-energy-consuming, high-pollution chemical companies were ordered to suspend production and relocate. Then the prices of chemical raw materials skyrocketed.
In the post-epidemic era, the economy has recovered rapidly, demand for chemical raw materials has surged, production capacity has been suppressed, and manufacturers and dealers are hoarding goods. Chemical companies, which have been neglected for a long time, have ushered in a cycle of crazy increases in both volume and price.
Nowadays, power and production restrictions have once again detonated light industrial manufacturing, which has the same effect as the supply-side reform of chemical companies. . In the context of the “carbon neutrality” strategy, high-energy-consuming, high-pollution industries such as chemical industry, light manufacturing, and coal power and energy are all key industries that need to be vigorously adjusted by policies. What should be relocated must be relocated; what should be upgraded must be upgraded; what should be shut down must be shut down.
However, this year’s power and production restrictions are somewhat different from last year’s chemical industry rectification. In terms of the adjustment of chemical companies, the Chinese government has taken a heavy blow, shutting down thousands of illegal chemical companies, and relocating and rectifying thousands of chemical companies. However, in terms of light manufacturing, the main measures are to limit power supply and production, and there is no order to shut down.
Many textile clusters announced measures to suspend production for 10-12 months
The era of money but no goods may have arrived
CITIC Securities research report stated that judging from the objective operating status of the economy, with the subsequent recovery of overseas supply, the global The gap between supply and demand is expected to narrow, and China’s exports will naturally fall back. This means that the high increase in energy consumption caused by the rapid industrial growth this year is unsustainable. From a short-term perspective, mid-to-late September is the assessment time point at the end of the third quarter, which may be a small climax of the production and electricity restriction policy. It cannot be ruled out that there will be marginal relaxation after October. Many companies that have suspended production due to government restrictions have given guidance to suspend production until September 30. At the same time, the governments of many textile clusters have recently notified specific control measures from October to December, which not only alleviates the current market anxiety, but also pokes the wall again. The market is sensitive!
The current power and production restriction policies in many regions until the end of the year have led to a sharp reduction in the market inventory of many products. Now, there is no upper limit to the price increase in the later period. All prices are possible. There is money but no goods. The era has arrived.</p
