Factories in India and Pakistan are looking for orders from China!

Factories in Pakistan and India struggle to find Chinese orders

Recently, the demand of some textile exporting countries has weakened. The price of foreign disks has dropped significantly due to the Russian-Ukrainian war, and foreign factories have a strong willingness to ship. Due to the sudden seriousness of the overall foreign trade situation, factories in Pakistan and India have been working hard to find orders from China, but the prices are still upside down. 10 second-line yarns of Pakistani yarn are about US$3.42/kg, which is 6% lower than the quotation of US$3.64/kg at the beginning of the year, but it is still upside-down with the spot in Guangdong at 1,000 yuan/ton, with a small transaction. The Indian side also immediately cut prices to meet China’s needs. 32 combs were US$4.55/kg, down 5% from last week, but the transaction was sluggish and a small amount of transactions were made. On the whole, the current market confidence is insufficient. The yarn supply chain company’s shipment rate is about 1/3 of the same period of previous years. The export orders are scarce, the domestic demand is insufficient, and the market is worrying.

At present, textile raw materials are generally in a high and volatile market, but downstream demand is still weak. At present, corporate profits are gradually shrinking, raw materials fluctuated at a high level with the situation in Russia and Ukraine, but prices did not rise, and even showed signs of decline, enterprises were divided, and small and medium-sized enterprises frequently reduced and stopped production.

The “Gold Three Silver Four” market is expected to open slowly

The entire downstream industry has not fully digested the increase in production costs from the upstream. At the same time, under the contradictory situation of high cost and weak demand, the profits of downstream enterprises are swallowed up, the market contradiction is sharp, and the industrial structure is fragile and other problems are becoming more and more obvious.

The market still has certain expectations for the peak season demand from March to April, but judging from the performance in the first ten days of March, the demand is likely to show the characteristics of low peak season.

The downstream operating rate is weak year-on-year, the inventory is at a historically high position, and the inventory pressure is relatively large. Recently, the domestic epidemic has spread in many places, and various regions have increased prevention and control measures and adhered to “dynamic clearing”, which has a certain impact on the production, transportation and sales of some cotton spinning enterprises and the business of some traders in the light textile market. Following the suspension of Dongguan Dalang Wool Trading Center and Hangzhou Sijiqing Clothing Street, Huzhou Zhili Children’s Clothing City and Zhili International Textile City also announced that they will be closed indefinitely. Some small and medium-sized cotton spinning enterprises in Henan, Shandong, Hebei and other places reported that with the upgrade of epidemic prevention and control, not only cotton procurement and transportation have been affected to a certain extent, but also weaving enterprises and cotton yarn traders in coastal areas such as Guangdong, Jiangsu, Zhejiang, Shandong and other places inquired and purchased , The delivery also slowed down compared with the middle and late February. Under the premise that the accumulated cotton yarn inventory is gradually increasing and the working capital is tightening, the expectation of phased reduction and shutdown is strengthened.

However, in the short term, the market should not be too pessimistic. Due to further compression of profits, textile enterprises maintained the buy-as-you-go model of raw material procurement, and industrial inventories fell to a relatively low level. Recently, the terminal clothing industry is holding a spring order meeting. Although overseas consumption has peaked, it still has the power to continue to place orders and replenish the warehouse. In March, textile enterprises have periodic demand for replenishment of raw materials, and the “gold three silver four” market is expected to open slowly. At that time, there may be a round of replenishment market, which will still support the prices of textile raw materials in the short term.

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Post time: Apr-02-2022