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Chemical Fiber Textile Industry: Cannot sign long-term contracts Since the beginning of this year, the textile industry in Quanzhou has faced numerous difficulties: First, there is a shortage of labor, followed by the trade barriers of the European Union and the United States, and then the price of crude oil has risen sharply. Two-thirds of the main raw materials for the textile industry are chemical fiber, and the main raw material for chemical fiber is oil. Crude oil prices will inevitably lead to price increases for chemical fiber.
Fujian Yuying Chemical Fiber Co., Ltd. is an export-oriented enterprise that specializes in the production of polyester filaments, viscose fibers, nylon filaments and other products. According to the manager of the company, Zhang said that due to the increase in the price of crude oil, the increase in raw material prices led to the increase in the price of chemical fiber products, which had a negative impact on the company’s sales – it did not dare to accept long-term foreign orders. After the signing of the contract, once the oil price rises again, the price of the product will surely keep up, and the user will pay only according to the contract price. The risk of the company's profit and loss is too high. This year, the company has reluctantly abandoned several processing orders for the EU with a total amount of nearly 50 million yuan.
Quanzhou is one of the Fujian chemical fiber textile production bases. Many enterprises are export-oriented enterprises. They have received orders from overseas and put into mass production in factories in China until they are shipped and shipped. Due to the long process, many of the current oil prices have risen three times. Businesses are afraid to take this risk.
Shoes and shoe materials industry: negotiable price increases are helpless Under the soaring oil prices, shoe-making and shoe-making companies are facing the same difficulties with textile and chemical fiber companies. There are more than 3,000 footwear companies in Jinjiang with an annual output of more than 700 million pairs and an output value of over 15 billion yuan. 60% of its products have entered the international market and are exported to more than 80 countries and regions in the world. The annual foreign exchange earning reaches 1.2 billion U.S. dollars. Plastics, synthetic rubber, and adhesives used in shoemaking are petrochemical products, and oil prices continue to rise. The rising cost of the footwear industry has become increasingly evident.
Jinjiang Rongtai Shoes Company is a manufacturer specializing in the production of EVA foamed soles. Its products are well received by the market. However, the owner of the company, Lin, said that the rise in crude oil prices has caused raw materials to rise too much. Now, the material that produces a pair of shoes can only have the profit of one to two yuan, shoe manufacturer has to negotiate with the customer to increase the price. However, there is no room for discussion on export products. With anti-dumping measures imposed by countries such as the European Union, companies do not dare to sign orders abroad.
Resin handicraft industry: 1/3 enterprise diversification The production of handicrafts from resin as raw materials is an industry with many practitioners in Quanzhou. It is understood that because of the high price of crude oil, resin raw materials rose from 7,000 yuan per ton in early 2004 to the current 13,000 yuan, an increase of 85.7%. The cost of resin raw materials in resin handicrafts accounted for 36% of the total cost, and the sharp rise in the price of resin directly swallowed the final profit of the company. After years of competition and development, the resin industry has entered the era of meager profits. The rise in raw material prices has made the production and operation of SMEs more difficult. A considerable number of SMEs are in a state of deficit, and one third of the companies have restructured or changed their businesses. At the same time, as the resin material continues to be high, the price of its subsequent products lacks space for decline. Enterprises are afraid to accept lower-priced orders, and customers reduce the purchase of resin products to other handicrafts, leading to a shrinkage of the resin handicraft market.
The rise in oil prices has led to a rise in resin raw materials. According to statistics, from January to July, the resin enterprises above designated size in Fengze District of Quanzhou realized a production value of 670 million yuan, a decrease of 31 million yuan over the same period of last year and a decrease of 4.4%.
Lessons Learned: Business Should Be Prepared How long the oil price rise will continue to be unpredictable, and the industry shock wave caused by high oil prices is still continuing. Therefore, how to establish a response mechanism for abnormal price fluctuations has been placed in front of Quanzhou chemical companies and even national chemical companies. The recommendations made by people in the industry are worth learning: For some pillar industries that require a large amount of raw materials, the government and industry associations should consciously guide companies to make appropriate reserves of raw materials in order to reduce the losses caused by price fluctuations; enterprises must abide by business rules, not Take the opportunity to raise prices or reduce prices; companies should adopt joint and collective procurement methods to increase the ability to negotiate bargaining prices with raw materials. In the long run, the development of the raw material futures market and the enhancement of risk prevention awareness of enterprises are the methods for both temporary and permanent cures, and to get out of the dilemma and enter the market.
The Choice under the Pressure of “Oil Shortageâ€â€”—Different Ways to Respond to the Crisis in Fujian Quanzhou
Since July, crude oil prices in the international market have risen sharply. The current price per barrel has exceeded US$67. Domestic refined oil products have also raised prices several times this year. At the same time, a new round of “oil shortages†with Guangdong and Fujian as the “creation areas†is spreading throughout the country. As one of the regions most affected by the “oil shortage†along the coast, various chemical companies in Quanzhou, Fujian Province, have to make various responses under the pressure that the profitability space is greatly compressed.