RMB Appreciation Cotton Doubles: Sell More, Earn Less?

It sold 35 last year and sold 53 this year.

From doubling the price of cotton to the price of the market, the price of a garment is not only going through the mountains, but also through many links - cost, processing, circulation, and end to end consumers.

The wholesale market merchants have been back in half of the thousand winter suits

"After five or six years of clothing, I felt so miserable the first year!" Hao Xiaoli worked in the poly dragon clothing market at the zoo.

Hao Xiaoli's stalls were in Julong B Road, where people used to be crowded, and three storey and three storey crowds filled their customers every day.

Since the price of clothing began to rise in October, there has been no previous busy scene.

Although many people choose before the booth, most of them buy less, especially after asking the price, two hundred or three hundred yuan a piece of cotton clothes, let everyone shake hands and walk away.

"If a down jacket is 500 yuan, who will buy it in our wholesale clothing market? It will almost catch up with the market price."

Hao Xiaoli said.

According to Hao Xiaoli, although the annual clothing prices will rise slightly, but this increase is minimal.

This year is not the same. The rate of increase is 20%.

It is understood that Hao Xiaoli's stalls are running at the best time of seven thousand or eight thousand yuan per day.

After deducting the cost of stall for nearly a thousand yuan per day, and deducting the cost of clothing, you can earn hundreds of dollars a day.

"Half of the thousand pieces of winter clothing that we enter are still on the backlog. If we can't sell them before the Spring Festival, they will really be in their hands. It will be money for us."

Hao Xiaoli's words were filled with helplessness.

In fact, consumers are directly affected by price increases.

The dress principle of miss white collar is "if you are right, you can accept it more."

But now, she has become a person who doesn't discount and will not enter the mall.

"Most of the brands I buy are b+ab, ONLY and VERO MODA, and the price is basically unconcerned as long as the style is right. Anyway, the price of these brands is within the acceptable range for the small white-collar workers with a monthly salary of 3500 yuan."

Miss Hu is still a bit excited about the previous shopping situation, but now she does not think so.

In her first two days, Miss Hu saw a ONLY down suit in her middle friend, which was about the same style as she bought last year.

Unexpectedly, last year, when buying 560 yuan, this year, the price of 790 yuan, up 200 yuan.

Last year's 2500 yuan b+ab long down jacket, this year Leng is up to more than 3000 yuan.

"If it was last year's price, it would bite and bite. Now the price is only enough to buy a down coat for one month, and you'll be hungry if you buy it."

Miss Hu told reporters that it is basically discounted to go shopping, otherwise it is too expensive to wear clothes.

In fact, the high price of clothing is due to the high price of the upstream wholesalers.

Shenzhen Wen Ke Er clothing trade firm specializes in wholesale apparel business. The wholesale price has been rising for nearly a month, so they have received many customers' bargaining.

The manager of the commercial office told reporters that the number of customers who had received the call recently would ask how much the price had gone up and how much more it would go up?

Cotton has risen by 170%, cotton yarn has increased by 150%, and cotton has increased by 30%.

Reporters learned that an original price of 100 yuan of women's clothing, fabric prices rose, the cost increased by 8.4 yuan, plus accessories, labor costs rose 4 yuan.

Even if the factory maintains its original profit, the present price of the dress has reached 112.4 yuan.

Wen told reporters that a cotton jacket with three layers of cotton was used. One layer costs about 2 meters of cloth, and three layers of cotton are equivalent to 6 meters for a piece of clothing.

At the present rate of increase, the price of cotton per metre has increased by more than 1 yuan, and it is almost 10 yuan by 6 meters.

Our wholesale prices have risen by 10 yuan, not to the downstream retailers.

Some downstream retailers who often come to the wholesale market usually bargain now.

This should be put aside, so that more than a dozen yuan will be taken, but now, even a few pieces of money must bite.

"The price is too high for retailers to sell, so we do not sell well in wholesale."

Wen's manager's speech also showed the helplessness of raising prices.

In September 25th, China's cotton price index broke through 20 thousand yuan / ton mark.

Half a month later, cotton prices broke through 30 thousand yuan per ton.

In the next short and a half months, domestic cotton prices have risen by 50%.

In November 15th, data from the national cotton trading market showed that the order volume of commodity cotton decreased by 49080 tons compared with the previous trading day.

Cotton prices are almost unbearable.

Why does cotton rise so fiercely?

According to the National Bureau of statistics, China's cotton planting area and output have declined for three consecutive years, while the global cotton supply in the 2009 to 2010 years decreased by 5%, while the global cotton consumption demand increased by 7%.

At the same time, India, as the world's major cotton exporter, reduced cotton production and reduced export volume, which is also the main reason for the rise of international cotton prices.

Cotton prices continue to sing triumphant songs, so that many manufacturers of clothing production profits fell significantly.

Cotton generally accounts for 60% to 70% of the cost of cotton spinning enterprises. According to the average profit of about 12% of the industry, cotton prices increase by 1% each, and the profit margin of enterprises is reduced by 0.53%.

If we calculate the cotton profit by 50%, the profit will drop to 26.5% in one month, so it is obvious that domestic clothing prices generally rise by 20%, which is a helpless action for manufacturers.

Expert analysis

In November 12, 2010, the interbank foreign exchange market was 1 yuan to 6.6239 yuan. It is expected that the fourth quarter will reach a new high of 6.55 against the US dollar.

Next year will reach 6.20.

The 1% increase in the real effective exchange rate of RMB will result in a 1.4% reduction in the growth rate of trade surplus after 5 months.

The pressure test results in the first quarter of this year show that the pressure range that China's foreign trade enterprises can withstand in the appreciation of RMB is between 3%-5%, and now the RMB appreciation is 5% before the end of the year. Even the dominant foreign trade enterprises will have no money to earn.

Professor Wang Jun, School of economics, Capital University of Economics and Business, said that after the depreciation of the US dollar and the appreciation of the renminbi, when some of the exporters, specializing in export trade, gradually lost their economic benefits in the process of export, they would pass the lost economic losses to the domestic market.

In some garment factories in Guangzhou, tens of thousands of garments originally used for export have been hoarded, some even up to hundreds of thousands.

If tens of thousands of garments are exported, hundreds of thousands of losses will be unavoidable.

As a result, a large number of overloaded export garments, the original price plus profit loss due to exchange rate changes, has caused the current situation of domestic clothing prices rising.

Comparison of export garment profits before and after RMB appreciation

In September 1st, a $15 garment was exported to RMB 102 yuan.

After appreciation

In November 10th, the exchange rate of RMB against the US dollar was 6.6450:

The same value of a garment, which is only 99 yuan, has evaporated the cost value of 3 yuan.

Export ten thousand pieces, the loss is 30 thousand yuan.

The Fed's banknote directly affects cotton prices.

To speed up the slow economic recovery, the Fed launched the second round of quantitative easing (QE2) monetary policy in the morning of November 4th in Beijing.

The surge in the supply of money, resulting in a surge in the money supply, is a powerful catalyst, which directly leads to a full rise in commodity prices, while cotton prices are directly affected by the price of 600 billion yuan.

According to the price index of China's imported cotton in October, by October 28th, the price of imported cotton in China was 25502 yuan / ton, when 861 yuan fell.

A few days after the Federal Reserve announced the QE2 policy in November 8th, the price of cotton imports rose to 28493 yuan / ton.

The price of domestic lint to the factory was increased from 26760 yuan per ton in October to 28891 yuan / ton, rising 2131 yuan per ton.

Some analysts pointed out that the Fed's move means an increase in market capital supply, and the continued depreciation of the US dollar is an important reason for the rise in international commodity prices in dollar terms, and also an important reason for the strong trend of international cotton prices.