Cotton Spinning Enterprises Call for Continuous Stability of Cotton Policy

At a summary meeting of the China Textile Industry Federation’s spring survey activity recently held, in the past year, cotton spinning companies were plagued by cotton problems, and the pressure was relatively large. Although this year’s cotton direct subsidies are expected to gradually be opened, due to the policy adjustment rules are not clear The international cotton price was affected by the falling trend of domestic cotton prices to form a new spread, which seriously affected the normal production and circulation of the cotton spinning industry. The company therefore called for a continuous and stable cotton policy.

In order to understand the cotton problem, after the Spring Festival, the China Cotton Textile Cotton Research Team visited a total of 100 household cotton companies in 6 provinces and 21 regions. The survey results show that, overall, large enterprises are relatively stable in operation, and small enterprises are faced with serious loss of orders, underemployment, low starting rates, and sharp reductions in profits. The pressure on liquidity of enterprises is high, and many enterprises that transfer industries abroad have dubbed it. He is not "going out" but "escapes."

According to Yang Shibin, director of the Cotton Spinning Group Office of China Textile Industry Association, China Textile Spinning Co., Ltd. took Shandong, Henan, Hebei, Hubei and other provinces with low count yarn production as the research focus. The results showed that China's cotton textile enterprises, especially small and medium-sized enterprises, faced Four major problems.

First, orders were tight and imported yarns had a huge impact on the Chinese market. In particular, the production of low-spray cotton yarn enterprises below 40S is affected by the imported yarns of India and Pakistan, and the production and operation conditions are deteriorating. After the Spring Festival, the start-up is slow, and the opening rate is low. Last year, companies that insisted on doing pure cotton yarns have basically started to switch to blended yarns this year. The second is difficulty in recruitment and labor shortage. Workers are older, and young workers are reluctant to go to night work. They cannot recruit and cannot keep. At present, the average age of employees in the cotton textile industry has reached 35 years of age. Zhu Bina, president of the China Cotton Textile Industry Association, pointed out that the current shortage of technical workers and maintenance workers in cotton textile enterprises is serious, and that the phenomenon of the aging of employees is obvious. This has not happened before. Third, the operating rate of enterprises is low. According to Yang Shibin, more than half of the enterprises surveyed have started operating at a rate of 65%, and only some large companies have reached 80%. In order to save costs, enterprises generally adopt "three shifts and two operations," and some enterprises have poor sales conditions, and they have opened strong positions for the frontier. Fourth, investment in technical reform is difficult. Due to the current low profits or no profits of SMEs, the follow-up momentum of technical reform is insufficient.

At the same time, the issue of the quality of the State Reserve Cotton is also the topic of corporate “Tucao” concentration in this survey. Many companies have stated that the quality of the State Reserve cotton is indeed a “headache” and that it is very burdensome to choose a cotton country. The national subsidies of RMB 500 per ton cannot make up for the shipping cost gap of RMB 7 or 800 per ton. The enterprises reflected that the quality issue of the State Reserve Cotton was mainly due to the high rate of short-lived cashmere, serious losses, and difficulties in exporting the goods. At present, China's cotton quality inspection adopts sample delivery inspection. Although there is no problem in the entire "examination" process, it does not guarantee that there is no problem in the "sample" inspection. At present, in order to make profits, many ginning factories have mixed high and low grades of cotton into grades or grades of flowers before they are put into storage. This has led to an increase in the national reserve short cotton lint rate, which has caused immense trouble for the latter spinning companies. There are also enterprises that reflect the recovery rate of the state reserve cotton that exceeds the standard range, the cotton has a heavy loss, and it is difficult for the cotton to be exported. In addition, the cotton photographed by a company often requires a staff tip for the library staff to ship the cotton.

In response to many existing problems, cotton spinning companies called for the establishment of a long-term state-owned cotton auction mechanism, and related links to relevant policies to allow cotton prices to track down.

According to an analysis by the China Textile Federation, the current cotton policy is in a period of change. Although there are many rumors in the market, it can be judged that the cotton textile industry will still have a hard time.

In the near future, the domestic cotton price may go down and gradually approach the international cotton price. However, the difference between the order price and the delivery price of the enterprise in the process will bring a lot of pressure on the production and operation. With the listing of new cotton in September, the situation faced by the cotton textile industry will be more complicated and companies should pay special attention.