On December 19, Ningbo City held a press conference on the prevention and control of the new coronavirus epidemic. At the meeting, it was announced that the temporary closed management of Zhenhai District, except for the Jiaochuan Street closed area and control area, would be lifted. Various commercial and service industries and enterprises have resumed work and production in an orderly manner, and primary and secondary schools have resumed teaching.
Petrochemical products from Zhejiang Dafeng Petrochemical, Zhenhai Refining and Chemical, LG Yongxing Chemical and other companies located in Zhenhai District, Ningbo will also gradually resume transportation!
This is undoubtedly good news for the textile industry. The unblocking of Ningbo heralds the gradual recovery of the epidemic in Zhejiang, and the confidence of textile people has also begun to recover. In mid-November, the new Omicron virus came fiercely, and the number of new cases surged in many overseas countries. This strain caused global panic, causing prices of crude oil and commodities to plummet, and weakening confidence in the textile market. In early December, the epidemic hit Zhejiang, once again increasing the panic among textile workers and lowering their confidence. Under the influence of the epidemic, the textile market has accelerated into its final stage. Prices in various sectors of the industrial chain have plummeted, and the market has been depressed for a time.
The unblocking of Ningbo will dissipate the downturn caused by the domestic epidemic. In foreign countries, although the Omicron strain spreads, its impact on international oil prices and commodities is weakening. Today’s textile market is still able to Expect.
Oil prices support the market
First of all, investors got rid of concerns about the Omicron variant of the new coronavirus, and at the same time the Federal Reserve gave an optimistic economic outlook, which led to an increase in international oil prices. Although oil prices have begun to fall again this week and the rebound has encountered obstacles, according to professional predictions, with the support of actual demand, even if oil prices fall, they may not be too smooth for the time being. Therefore, crude oil prices will remain strong in the short term.
Trading companies begin to rush orders
Recently, downstream factories have been issuing holiday notices, mostly printing and dyeing factories. The printing and dyeing link is very important for fabric trading companies. Without this link, it means that they cannot accept orders. However, many printing and dyeing factories will start their holidays in mid-to-late December, and the latest factory will also be in mid-January. So for traders, the production time is less than one month. Although the current market is in an off-season, some companies still have a large number of executable orders on hand, which can last until the Spring Festival holiday, or even next year.
Some printing and dyeing factories are still in a state of liquidation. The salesperson also said that even if they stop accepting gray fabrics into the warehouse now, they will not be able to finish the work before the Spring Festival holiday. Under such a crowded situation, if we do not consider changing the dyeing factory production, it is unlikely that we will be able to ship before that year. Therefore, given that part of the holiday time has come, traders have begun to rush production and rush orders. Terminal clothing may also take into account the window period during holidays and post-holiday production when production is slow to resume, and will stock up in advance, so the recent order situation may show signs of improvement.
The cold wave is coming, and the number of cold-proof clothing may increase
In terms of downstream apparel, in addition to the holiday notice issued by printing and dyeing factories, which will prompt some orders to be placed, the recent weather may also be a driving force. The fifth round of large-scale cold wave this winter is coming! It will create a large-scale severe cooling, with local drops reaching more than 12°C. Temperatures in nearly 20 provincial capital cities will hit record lows in the second half of the year. At this time, the down jackets that press the bottom of the box are finally coming out. The lowest temperature line of 0℃ is located from southern Zhejiang to the northern part of the Sichuan Basin. Places outside the bed are far away. If you don’t wear a down jacket when you go out, you will get a “wow” from the cold. As the temperature drops, the demand for down jackets also increases. After the sales volume of down jackets increases, the possibility of manufacturers replenishing their stocks also increases. A wave of replenishment orders may be on the way.
This year’s Spring Festival falls at the end of January and early February. It is still winter for a long time after the Spring Festival. It is not surprising that there is a “late spring cold” phenomenon in February and March. There is still a certain market for winter clothing. The hot sales of down jackets this year will, to a certain extent, affect the order volume of down jackets next year. At present, part of the orders Bu Boss is producing are for next year’s winter clothing. As down jackets are selling well this year and there is not much inventory backlog, it has played a role in stimulating clothing manufacturers’ optimism about next year’s down jackets.
To sum up, the high prices of upstream raw materials, early holidays for downstream processing plants, and the coming cold wave will stimulate garment companies to replenish orders and stock up. At the end of the year, when the epidemic in Zhejiang dissipates, there is still a chance for the textile market to reverse!
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