Textile industry will go out of the bottom in the first quarter of next year

In the second half of 2011, the economy weakened, the prices of textile raw materials fell, and the middle reaches of the textile industry fell into a low ebb, and the quotation was difficult to increase.

Downstream orders have gradually recovered in 2012, and the textile industry is expected to peak after the lunar year, but it is estimated that profit growth is limited.

The debt crisis in Europe and tightening of credit in China, the textile industry in the second half of this year, the economy has been plunged, prices have fallen, and in the fourth quarter, the upstream chemical fiber raw materials tumbled, and mid-stream processing silk products and other products offer aggravating decline.

In the first quarter of this year, the international cotton price was 150 cents per pound. After setting the best single-quarter profitability level in recent years, the number of US cotton farmers increased by 25%. The cotton cultivation area in China and India increased year-on-year, and the cotton season in the fourth quarter of 2011 increased. Supply has increased significantly.

The U.S. Department of Agriculture predicts that global cotton production will reach 123 million bales (480 pounds per bag) from 2011 to 2012, an increase of 7.7% year-on-year, but the global demand for the same period will be reduced from the original estimate of about 116 million bales to 111 million bales. Reflecting the slowdown in the European landscape and China's demand, global cotton supply will exceed demand by 10.9%, and supply and demand conditions will reverse.

In the price segment, the cotton harvest season from the late fall to the early next year will increase the short-term supply surplus, which will also cause the recent cotton price to fall from 100 cents per pound to 86 cents. It is expected that the supply and demand adjustment will continue for up to six months. In the first half of the year, international cotton prices will be between 80 and 95 cents per pound.

The price of cotton has fallen, and it has been difficult for the processing silk group with substitution effect to raise prices. In addition, new production capacity of terephthalic acid (PTA), the upstream raw material of polyester yarn, has been successively released in China, making global PTA capacity utilization rate peak since 2011. After all the way down, the supply and demand situation has been slipping year by year, and prices will be relatively more pressure.

Due to the Chinese government's relatively limited supply of PX raw materials for PX, the supply of PX is relatively tight. It will also compress PTA plant spreads, the recent sluggish demand and continued decline in prices, and it is expected that 2012 will be expected to enter the bottle after the Lunar New Year. With the grain jelly season driving up the offer, but the long-term capacity utilization to take the low pressure, polyester margins will be relatively suppressed.

Looking forward to 2012, downstream orders have gradually recovered and the textile industry is expected to come out of the trough after the Lunar New Year.