Dye Prices Fell High Into The Supply Of Loose Pattern

In the middle of this year, the domestic dyestuffs showed a noticeable downward trend. On the one hand, the supply end factory inventory remained high. On the other hand, the demand side textile industry showed a weak performance. Overall, dye enters the loose supply pattern.

In the first half of the year, under the influence of dye related accidents, the tightening of dye supply is expected to intensify gradually. However, over half of 2019, the actual performance of dyestuff is high. In the first half of 2019, Zhejiang Longsheng dyestuff output was 86 thousand and 400 tons and sales volume was 101 thousand and 300 tons. According to the 10 thousand tons data collected in the first half of the year, 2019 tons of dyestuff finished products were still 77 thousand and 600 tons by the middle of 2019, and the stock could be sold for 4.6 months.

As far as Zhejiang Longsheng saw, the production of domestic dyestuffs decreased by 28.27% in the first half of the year due to the capacity relocation of Dao Dao factory area, but at the same time its sales volume dropped by 12.37%.

Dye demand decline, on the one hand, is constrained by the high impact of dye prices on the downstream dyeing factories causing huge cost pressures, on the other hand, it is also dragged down by the terminal demand. Since 2006, the domestic textile industry has maintained a relatively high growth rate. However, after 2012, the boom of the textile industry declined, and its growth rate began to show a unilateral downward trend. By the 2018-2019 year, the textile industry added value growth rate has slowed to 0 growth.

The weakening of the textile industry in the terminal has also been fully reflected. Since 2012, the growth rate of China's clothing retail sales has been declining year by year, especially in April 2019, the year-on-year growth rate has been negative for the first time in nearly 10 years. At the present stage, with the weakening of China and the global economic situation, there is no new growth pole in the textile industry, and its demand is approaching the ceiling.

From a long-term perspective, Chinese dyestuffs will still be subject to the effective improvement of terminal demand, but at the same time, due to the tightening and adjustment of domestic environmental protection and safety supervision policies, and the implementation of the expansion plan of dye production enterprises, the concentration of dyes will be further improved in the future. With the increase of concentration degree, the voice of Dyestuff Factory will continue to be strengthened in the market, which will be the "two way to ensure high profit" in dye industry.