Rising Raw Materials Threaten Volume Of Canton Fair

More orders and less profit.

At this Canton Fair, with the price of raw materials such as steel, petroleum products and other upstream enterprises generally rising, many industries have not escaped the fate of rising raw materials and profits.

Taking copper as an example, it has risen nearly 30% in recent years, nearly 20% of PVC and BOP in chemical raw materials, and many enterprises have increased their external quotations by 5% to 10%. However, they can not hedge the pressure of rising costs, and further reduce the profit margins of enterprises.

"The rising price of raw materials is even more worrying than the fluctuation of exchange rate. This year we are getting stronger than before. Now we are not worried. We have no order and worry about low profits."

At the Canton Fair, the head of an enterprise from Zhejiang expressed their distress to reporters.

And this is not a case. According to a reporter's survey, raw material prices rose by two or three, and labor costs rose by four or five.

Exhibitors generally get into trouble in the post crisis era. Most exhibitors have more than 10% increase in prices.

The increase in orders has given the foreign trade enterprises a sigh of relief, but the drop in profits has brought pressure to the enterprises.

Jiang Zhong, the two manager of Nanjing technology import and export limited liability company, said that the volume of orders in the first three quarters of this year was unchanged from that of last year. Although the export volume of the company increased by 20%, there was no increase in profit.

"The products of the company are located at the top end of the design and materials, and the higher value-added can temporarily hedge exchange rate fluctuations."

Huang Jing, Gauss bathroom sales manager, said that at present, the exchange rate fluctuations can still be strong, but the raw materials will be too fast to rise.

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Cotton prices surged to hit the textile industry

Before and after "eleven" is the critical period for cotton growth. However, due to the influence of weather, cotton production has failed and the price has gone up sharply, which has seriously frustrated the textile industry.

This reporter learned from the exhibition hall of Guangzhou trade fair that cotton yarn rose fiercely. Now it has risen to 40 thousand yuan / ton, up 20% compared with the same period last year, and the price is almost a few days.

This has led many businesses to dare to act rashly, turning positive orders in previous years into action after finding out the market situation.

The owner of a garment factory in Liling told reporters, "although the order is increasing, the price of cloth raw materials is rising, squeezing profit margins."

At present, garment processing enterprises should not pay too much attention to sales volume. They should focus on clothing design and brand building, increase the added value of products or alleviate some pressure. "

Reporters visited the scene of the Canton Fair and found that although many people wanted to place orders before the booth, merchants did not dare to act rashly.

According to statistics, cotton fabrics have increased by 25% over the same period last year, the fastest rate in history, and the appreciation of the renminbi resulted in a 3% loss in foreign exchange settlement.

No wonder businessmen are too late to take the lead.

"At this stage, prices can only be raised, but for clothing such a low value-added product, the price increase still won't win the exchange rate and raw material gains.

Once orders are received, more than half of the profits will be swallowed up.

Mr. Zhang, director of a clothing company in Foshan, said in an interview with our reporter.

The head of the export division of the AI group told reporters that "before participating in the Canton Fair, the price was set in advance.

At the time of the exhibition, one price is quoted.

But this year we have to split the price, the fabric, labor costs, exchange rate and other factors should be taken into account.

The official admitted that cotton prices can be understood, the question is how much the current situation will rise, when will stop it is difficult to grasp.

They can only increase the price of the product, otherwise the enterprise will be faced with bankruptcy.