Cotton Prices Rise, Clothing Companies Dare Not Place Orders

The Qingtian enterprise located in Zhen Ze town, Wujiang, Suzhou, is a famous processing enterprise, mainly exported from sweaters, knitted garments and warp knitted fabrics.

The annual sales volume of the whole enterprise is 250 million yuan, of which sweater sales amount to 100 million yuan, almost half of the total.

Prices are too high for orders.

Yesterday, Zhengzhou commodity

For big companies like Qingtian, the days seem to be no problem, and the volume of work is still full.

The director of the enterprise said that the production in the workshop is basically the work before September.

According to the processing flow, it will take three or four months from signing, raw material purchasing, production and processing to final delivery, so processing orders in the first half of next year will be worrying.

Sheng Guofeng further explained that the main reason is that the price has skyrocketed and plummeted, and customers are not allowed to get the price.

"Our main customers in the United States, customers have stopped making orders recently, and we will be in a position of no rice."

10% supplier default

Suzhou Qingtian's largest raw materials are cotton yarn, silk and viscose.

According to the introduction, the price of silk and viscose has increased by about 30% this year, and cotton is also "thriving". Judging from the futures price that has fallen, it has risen more than 50% since September.

The rising price of cotton is a concentrated reflection of all kinds of comprehensive factors.

Climate factors reduce cotton production; India

"We also predicted that we would go up, so we had to increase our stock for three or four months.

But for enterprises, stocking is limited and there is no limit to stockpiling.

Sheng Guofeng said that even 10% suppliers who had signed a supply contract with them had chosen to default on the price of soaring prices.

Because in their calculations, the cost of breach of contract is far less than the cost of soaring prices.

Price trend of December

In Sheng Guofeng's view, the price of cotton yarn has risen from 39000 yuan / ton last year to the current 65000 yuan / ton, and the drop is inevitable.

But he did not expect prices to fall back to last year's level.

"Slight rise point is normal, customers can also digest, but can not skyrocket, otherwise customers can not accept a sudden increase in 20%-30%."

He said, "I think it is more ideal that cotton yarn prices in December dropped to around 50000 yuan / ton, or less than 10%.

Maintaining a relatively stable price can ensure the normal planting enthusiasm and is conducive to the healthy development of the whole industry.

However, if the cotton yarn price does not come down next month, or even go into the rising channel again, what should we do? Sheng Guo Feng believes that for processing enterprises, orders will also be available, but the number of processing will be sharply reduced, and customers can only drop small orders to maintain their own sales.

"Actually, we do not dare to pick up large orders or long lists. If cotton prices are two days a day, we are afraid to sign contracts with customers."

At present, Qingtian enterprises actively tap the potential inside the market, reduce the production costs and other measures to deal with market risks, such as making hand-made products into computer production, and striving to enlarge the size of orders.