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Chinese fabric mills face falling orders

In the first half of 2019 fabric mills in China faced a decrease in orders.At the same time inventory levels remained high. So weavers had to cut or halt production. From mid to late August, the market showed signs of recovery. Enquiries and orders slightly increased compared to those in the earlier stages, but overall shipments were still limited. Sampling orders of knitting factories increased, and the overall operating rate recovered by 50 per cent or so. In September, some actual orders came in and shipments of weavers also increased slightly. However, the price continued to be weak. Dyeing mills gradually got busy, but there was still a lull compared to previous years.

In early September, with the implementation of actual orders and as weavers gave discounts regardless of cost, the inventory burden eased. But current cotton stocks were still higher than those in the same period last year. Fabric mills will be dominated by selling stocks in September. In addition, due to the long-term impact of the Sino-US trade war, some orders shifted to southeast Asian countries. In addition to the increased downward pressure on the economy, order recovery in September is not expected to be as good as in previous years and may be weaker than market expectations.

 
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