[Real Time] Demand Turns Off Season In November the textile industry wants to open the "winter" model

According to the textile index, continuing the good rally in September, the domestic textile market continued to show an uptrend in October. As of the 31st, the textile index was 849 points, a new high during the year, up 3.28% from 822 points at the beginning of the month, and a year-on-year increase of 14.27%. . Compared with the highest point in the cycle of 1074 points (2013-02-19), it was down by 20.95%, which was 18.74% higher than the lowest point of 715 points on February 17, 2016. (Note: Cycle refers to 2011-12-01 to present)

Inventories hit the low polyester industry chain led the textile list during the year

According to price monitoring, the polyester industry chain in October led the entire textile list. Among the 13 kinds of textile products with a month-on-month increase, the top 3 products for the increase were polyester POY (6.77%), polyester DTY (5.13%), and polyester staple fiber (4.91%). First of all, it mainly benefited from the mainstream manufacturers' inventory is generally at a low level, creating a low level during the year. According to statistics, as of the current POY stocks fell to 3-7 days, FDY stocks to 5-8 days or so, and DTY inventory to 10-15 days level, some product specifications even appear tight supply situation. At the same time, in October large-scale mainstream companies held market seminars, at the meeting of the medium and long-term polyester filament market still optimistic. Secondly, under the boost of OPEC's first limited production agreement, crude oil prices have been operating at a high level, breaking the 50-dollar mark per barrel. The overall start-up load of the pta equipment is only maintained at about 62%, plus the speculation of futures market funds, and the cost side will form a certain support. In addition, after the National Day holiday, the textile market ushered in the "silver ten" demand season, the recent well-being of terminal weaving, coupled with the impact of European and American Christmas orders, prompted an increase in foreign trade orders this month. Among them, the comprehensive operating rate of Jiangsu and Zhejiang looms climbed to a high level during the year. According to statistics, the overall operating rate of Jiangsu and Zhejiang looms is close to the level of 85%, which is a 3.5% increase from the end of September.

Crude oil is currently in a turbulent situation. The restart rate of PTA plant will recover to around 70%, and the supply will gradually increase, which will weaken the cost support. At the same time, the downstream textile industry will also enter the off-season demand and gradually become weaker. The polyester market is in the absence of further positive news stimulus, and it is expected that there will be a fall risk in November.

Insufficient market confidence, weak cotton prices

Compared with August and September, the “big downs and ups” continued the upward trend in October, but in the middle of the year, the cotton market price entered the shock adjustment period. By the end of October, the average price of cotton (3128B) market was at 15354.71 yuan/ton, which was only 3.29% from the beginning of the month, and it was a year-on-year increase of 18.33%. The main reasons are as follows: 1. The price of seed cotton fluctuates greatly. The price of seed cotton rises quickly in the earlier period. Seed cotton in the Yellow River Basin in Shandong and Hebei is generally between 3.60 and 3.70 yuan/kg, and individual reaches 3.90 yuan/kg. Many ginning factories try After the test was rolled, we couldn't wait and see. Afterwards, with the centralized listing of cotton, in particular, the ginning factory has been under pressure to inventory, and the control of the acquisition volume has become a major trend. Therefore, the price of seed cotton continues to fall. Second, downstream cotton yarn, driven by the cost, cotton yarn prices continued to rise slightly. As of October 31, the average price of 21S cotton yarn with high knitted fabrics was 22,525 yuan/ton, up 1.52% from the beginning of the month. Most of the weaving factories received poor feedback. Although prices did not change much, orders and sales volume shrank.

In the short term, the new cotton will gradually increase its market share. According to the national cotton market monitoring, as of October 28, the national new cotton picking progress is 73.6%. At the same time, downstream textile enterprises still have some low-cost reserve cotton stocks that are not in a hurry to make up for the stocks. The situation of receiving orders is not satisfactory. The original “Jin 9 Silver Ten” is the peak production season for enterprises. However, the actual situation is indeed “no busy season”. In addition, according to a survey conducted on 30 domestic cotton companies, more than 60% of the enterprises are still bearish on the outlook, and market confidence is still insufficient. At present, many bad signals have been released, and it is expected that the short-term cotton prices will continue to rise.

September retail sales of shoes and hats increased year-on-year textile exports fell sharply

From the perspective of the textile industry, textile exports fell sharply in September. According to statistics of the General Administration of Customs, China's textile and apparel exports in September were US$22.76 billion, a year-on-year decrease of 15.4%; January-September total exports of textiles and clothing were US$2011 billion, a year-on-year decrease of 4.9%. . However, in retail sales, retail sales of clothing, shoes, hats, and needle textiles totaled 117 billion yuan in September, a year-on-year increase of 6.7%. From January to September, retail sales were 100.2 billion yuan, an increase of 7.2% year-on-year. In addition, the bulk commodity supply and demand index (BCI) for October was 0.57, with an average increase of 3.83%, reflecting that the manufacturing economy expanded during the month compared to last month, and the economy had an upward trend.

Xia Ting, an analyst in the textile industry, believes that the continuing strength of the textile market in October was mainly attributed to the good performance of various products in the polyester industry chain and the strong promotion of the small variety of silk products. However, it is more likely to enter the November market correction.

Specifically, the domestic and foreign cotton market supply situation in the cotton spinning market has improved over the previous year. The overall situation of domestic cotton production cuts has been determined. According to the forecast of the China Cotton Association, the total national cotton output in 2016/17 was about 4.641 million tons, down 3.7 percent year-on-year. %, decrease for four consecutive years. The import volume is also declining. From January to September 2016, China has imported 650,900 tons of cotton, a year-on-year decrease of 545,000 tons, a decrease of 43.51%. However, the downstream consumption power is insufficient. With the successive listing of new cotton, the sales pressure of cotton will increase, and the pressure for continued price increase will also increase. In the chemical fiber market, after the plant enters November, unless there is force majeure or faulty parking, the factory will not choose to overhaul in winter, which means that it will maintain high load operation before the end of the year. At the same time, the prospects for curtailing crude oil production are blurred, showing a shocking pattern, so the cost of end support is limited. In the reeling market, the fall of silkworm cocoon in the autumn has generally determined the raw material cost for cocoon in the whole year. Before the demand has substantially improved, the unilateral support of raw material costs is obviously not enough for the current reeling market, but it is not enough for the market. The stability has also played a certain boost, and overall it is expected that the prices of silk reels will decline slightly in November.

At the same time, from the perspective of the entire textile industry, the textile export situation is still grim. In November, the textile industry will also enter the off-season demand. Affected by the continuous shrinkage of the demand side, the overall desire will open the “winter” model. The textile index is expected to have a maximum of 850 points and a minimum of 830 points. point. (Business Club)