Cotton prices fall next spring lock up 5% to 10%

Cotton prices fall next spring lock up 5% to 10%

Since the beginning of winter, due to the soaring price of cotton in the upper reaches, the four major textile materials have set off a new wave of bargain prices. Then, the clothing market "up" sound. “Once the cost of raw material price increases is difficult to translate, the profit margin of apparel companies will be swallowed.”

In recent months, there has been no greater concern in the textile industry than cotton prices. Suddenly, the price of cotton suddenly rises and falls.

In September, the spot prices of cotton, electronics, thrown cotton and cotton soared, and the purchase price of new cottonseed cotton in China exceeded 8 yuan/kg, and some even exceeded 10 yuan/kg.

Since then, the soaring cotton price suddenly changed in mid-November. From November 11 to 12, the price of cotton ** continued to appear in two consecutive daily limit, and the rapid decline in the speed of fire. On November 25, the closing price of the Zhengzhou Commodity Exchange (CZCE) Cotton ** (1105 main contract) was RMB 25,270/tonne, which was a decrease of 25.06% compared with the highest price of RMB 33,720/tonne on November 10; November On the 26th, China's cotton price index (328 cotton grades) was 26,681 tons. Compared with the historical high of 31,302 yuan/ton on November 11, it had fallen by 4621 yuan/ton, a decrease of 14.76%.

Spring dress next year: price increase lock 5%-10%

Since the beginning of winter, due to the soaring price of cotton in the upper reaches, the four major textile materials have set off a new wave of bargain prices. Then, the clothing market "up" sound. "Once the cost of raw material price increases is difficult to translate, the profit margin of apparel companies will be swallowed." Insiders believe that garment companies have been forced to the limits of profitability.

However, when reporters interviewed the 15th China (Humen) International Apparel Fair recently, they found that the clothing market here has not been hit by Khmer prices. As the weather vane and fashion release place of China's fashion trends, the price of Humen clothing has not changed its face and sales are still hot. The service trade fair that has just ended has also shown good results: The number of visitors and purchasers has exceeded 800,000 person-times, with an expected transaction volume of 4.63 billion yuan.

However, the reporter also heard such a voice during the interview in Humen: Next spring and summer clothing, it may be another scene. Some people predict that next spring and summer clothing prices will rise 5% -10%, when Humen will no longer be a "hero."

In fact, with the rise in the price of raw materials such as cotton, many clothing brands across the country have already adjusted their prices during the 11th period. In particular, the prices of winter clothing such as down jackets are even higher. Hu Wei Wen Chung Garment Co., Ltd. assistant general manager Fang Wei told reporters that the garments currently sold on the Humen garment market are mostly raw materials imported before the cotton price increase, so the market price is fairly stable. The soaring cotton prices will probably affect the spring outfit next year. Fang Wei said: "In the days when the price of cotton rose, the price of cotton once a day, and sometimes the effort of a meal, it would have lost tens of thousands or even hundreds of thousands of dollars. The 'unpredictable' cotton price is really outrageous. ”

According to reports, cotton as the main raw material of cotton spinning enterprises generally accounts for 60%-70% of the cost. According to the industry average of 12% of the profit, the cotton price rose by 1%, and the profit reduction of the company was 0.53%. When Humen is listed next spring, what is the space for price fluctuation? 5% or 10%? However, reporters are more likely to hear Humen’s clothing companies’ “cost reduction”. Some companies stated that they will strive to reduce clothing production and sales costs by adopting various methods from the aspects of fabrics, design, and operation. Fang Wei told reporters: “We will strive to expand the scale of procurement and innovative marketing channels. “Wen Chun,” will focus on simple design, by reducing the complexity of the style, to reduce the use of fabrics. In addition, in order to reduce operating costs, we will also take Multi-channel sales model, in addition to physical stores, will also begin to try the network, so the operating costs will be relatively reduced.

Cotton price **: The top ten buyers are not textile companies; cotton prices have fallen by nearly 15%; cotton prices have fallen by more than 25%. Faced with dramatic changes in recent cotton prices, Vice President of China Textile Industry Association and China's cotton textile industry Xu Wenying, honorary president of the association, pointed out that this is a revised regression after the over-hype in the previous market. Previously, high-speed soaring cotton prices brought huge market risks. This rise is not driven by rigid demand, and it is inevitably falling back from supply and demand fundamentals. In addition, the influence of national macro-control measures is also an important factor.

On January 4 this year, China's cotton price index (328 cotton) was 14,879 yuan per ton. On November 11, it reached a record high of 31,302 yuan per ton, an increase of 110.3%. At the same time, the international cotton price also rose. The Cotlook A Index once reached a record high of 172.4 cents/lb. The international cotton price rose more than the domestic cotton price.

Thanks to the sustained recovery of the global economy and the support of the domestic macro economy, the growth rate of China's cotton textile industry is at a high level in the same period in recent years. From January to October this year, domestic yarn production totaled 22.3753 million tons, a year-on-year increase of 15.50%. Among them, the cumulative output of cotton yarn was 17,070,500 tons, an increase of 14.20% over the same period of last year. Annual yarn production is expected to reach 27 million tons, according to 50% of the cotton ratio, using 13.5 million tons of cotton. Affected by weather factors, the quality of domestic cotton declined during the previous year, and the output was less than 7 million tons. The gap in the middle was made up of imported cotton. This year's cotton import quota is 3.6 million tons. Due to the late issuance of quotas, only 2.15 million tons of cotton were imported as of September. There is a gap of 3 million to 4 million tons of cotton supply throughout the year. From a global perspective, in August, Pakistan was flooded and cotton production was reduced. In addition, India, the main cotton producing country, introduced measures to restrict cotton exports in April this year.

"The contradiction between supply and demand of cotton has attracted the attention of a large number of hot money, so the speculation has pushed up the mad price of cotton." Xu Wenying analyzed that this year the state has increased the regulation and control of real estate, and many real estate funds have turned to the agricultural product market; The unfavorable weather in the cotton producing areas led to the delay in the listing of new cotton, the tight supply and demand situation of cotton, and cotton became a hot product sought by the funds.

“The top ten buyers in the cotton ** market are not textile companies. This alone fully explains the important reason that caused the soaring cotton price. Hot money is pouring in, hoarding, malicious speculation.” Xu Wenying also pointed out that in order to ease the weather As a result of the shortage of new cotton products, the relevant state agencies have successively placed 1 million tons of national reserve cotton through auctions. However, due to the large supply of small demand, the auction did not have a ceiling price, and this time throwing storage did not achieve the effect of suppressing cotton prices. Instead, it led the rise in cotton prices.

Apparel Enterprise: Respond Quickly and “Change”

The price increase of cotton has really given a revelry to the capital operators. It has also caused the downstream companies to sweat. In the past, the clothing industry paid little attention to cotton prices. They believe that when the cotton price rise is very small, it is entirely possible to absorb price fluctuations through the price chain transmission, cost control, sales increase, and upstream price reduction. However, with the increase in the price of cotton, the ability of the apparel industry to absorb costs through other channels will also decline. Many clothing companies did not anticipate that the mad increase in cotton prices had inadvertently created an irreparable gap in the garment industry's profits.

“Compared with the same period of last year, domestic fabric prices have increased by about 50%, while the price of garment export orders can only increase by 15%-20%. Nowadays garment export enterprises have no profitable space to speak of.” A garment that exports mainly The business owner is miserable. He said: “In the past, the price of cotton yarn has risen. We will adjust the proportion of the textile products according to the market conditions. For example, if the cotton price is too high to make more profit, we will increase the proportion of purchases of chemical fiber and wool. In order to ensure the company's operating profit, but now several major varieties of textile raw materials are affected by the impact of cotton prices are rising, and the larger increase in the face of such market conditions, for a time do not know where to go.” At present, many textile downstream companies are After receiving the order, he dared not only purchase the raw materials and produce on demand.

According to report, many textile companies that recently participated in the 2010 Autumn Canton Fair generally raised orders by 20% to 30%, and some products even reached a price increase rate of 40%. however,

Foreign investors generally find it difficult to accept price increases of more than 20%. Some European and American customers have begun to reduce their purchases in China. In particular, orders for some low-end products will flow to Southeast Asia. Industry insiders predict that if this scenario continues, there will be a large number of foreign trade factories closed after the Spring Festival next year.

A few days ago, from the collection of 15 professional markets in China Textile City, the sample data monitoring and analysis of more than 1200 merchants showed that the price index of the “China·Keqiao Textile Index” 20101129 period closed at 105.40 points, which was lower than the previous period. 0.36%, from the first classification of varieties showed: raw material price index fell significantly, pulling the general category price index fell slightly. However, the price indices for fabrics, apparel fabrics, home textiles, and fashion accessories are still rising in different amounts.

At present, in major shopping malls, the price of clothes affixed to cotton is rising to varying degrees from last year. From cotton socks, cotton pajamas to cotton clothes, the prices are all the same. It is also understood that the cotton clothing in the shopping malls this year, in addition to rejection of the old models, generally has a 20% to 30% increase.

The bearer of the price is ultimately the consumer. Therefore, the price increase of the apparel company cannot help but look forward. From the point of view of the apparel brand itself, long-term continuous market positioning, price positioning, and style positioning do not allow for easy changes. In the final analysis, brand price increases must not only be accepted by the market, but also in pace with the mid- and long-term development plan of the brand.

“But not raising prices may not even make it difficult for the immediate difficulties.” The garment industry's cost control level needs to be further improved. What's more, the ability to absorb more energy cannot support the skyrocketing raw materials. Although the brand tried its best to increase the price in disguise, it was eventually seen through vulnerable orders. Fortunately, the country promptly suppressed cotton prices, so that the overall price of clothing is not far outrageous, which also allows temporary relief clothing companies have the opportunity to think about, whether the innovation channel can become the best way to take profit in the future.

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