Cotton Price Highlights Group For High Price To Lead Enterprises To Reduce Production

"Maori is too low, many garment enterprises are unable to support the cost of the increase, have to cut production, and some even shut down."

A few days ago, the responsible person of Guangzhou new land garment city told reporters that with the recent rising prices of cotton and other clothing production elements, many small and medium-sized garment enterprises are facing greater survival difficulties.

At the same time, it will also directly lead to a 10% increase in winter clothing prices this year.

However, as the international cotton prices continue to decline, insiders predict that the domestic cotton price will stop and the latter may gradually decline.

Cotton prices rise or fall

February 25th, China

At the same time, last Friday, by the international turmoil, the market continued to sell. The international ICE cotton futures contract in May hit the limit.

China reserve cotton Management Co.

It is also analyzed by insiders that large quantities of domestic cash are concentrated in the middle circulation.

In late November last year, in order to deal with the rising cotton prices every day, the textile enterprises adopted the tricks of buying and using. So far, the phenomenon of large-scale replenishment of textile and garment enterprises has been slow to find. In addition, the current external market is still showing no signs of decline. Naturally, the pressure on middlemen's heart and cotton confidence is growing.

It is also a dangerous sign that the domestic cotton price has not been significantly reduced with the decline of international cotton prices, which indicates that the latter market will continue to fall, which may be triggered by the spot market.

Clothing enterprises comprehensive

However, after all, high cotton prices in the short term have brought tremendous pressure to domestic garment enterprises.

As one of the main raw materials of the textile industry, domestic cotton 95% is used for spinning, weaving, printing and dyeing, and then processing into garments. The pressure of rising prices of raw materials is continuously being pmitted to downstream industries such as weaving, printing and dyeing, clothing and home textiles.

"Many of our clothing enterprises have been forced to cut production due to rising costs such as cotton and labor, and some have even closed down."

Guangzhou new land garment city official told reporters that in recent years, the cost of garment enterprises continues to rise, gross margins continue to shrink.

"5% of gross profit is good now."

The head of a clothing company in Dongguan said that because of the rise in cotton prices, the orders for a group of 350 thousand shirts that they had received a while ago were calculated at the previous price. They could only earn 1 yuan for each garment. However, when the order was pferred to the processing plant, the processing plant indicated that the labor cost rose, and the processing fee for each item was 2 yuan, resulting in a loss of 350 thousand yuan in the shipment.

However, at the same time, a large number of powerful enterprises have also accelerated growth in the crisis as the cost increases have caused a great blow to many small and medium-sized garment enterprises in China.

As of February 24th, 4 listed companies in Shen Wan textile and garment industry announced the annual report in 2010. Net profits attributable to shareholders of the parent company all increased.

11 listed companies released a performance bulletin, excluding the performance of the 4 companies declined slightly, the rest showed an increase.

48 companies released performance forecasts, of which 42 were preview companies, and 6 were preview companies.

The reporter found that the annual report of a clothing listed company in Shenzhen showed that because of the rising price of cotton in 2010, the company locked the price of raw materials in 10 years with suppliers in early 2010, so the company did not increase its price in spring and summer in 2011.

At the same time, reporters learned that, because of the rising prices of production factors such as cotton, at present, many domestic clothing production and sales terminal retail prices have risen by about 20%, and this year's winter clothing prices will rise by about 10%.