The domestic environmental protection continues to strike hard, the upstream raw materials remain high, and the downstream printing and dyeing materials keep rising. At present, China's textile industry is facing a huge examination, and the pressure is greater. On June 15th, Trump announced at the White House a 25% tariff on Chinese products worth 50 billion U.S. dollars. Let us pay attention to the prices of domestic grey fabrics and the current status of the textile industry.

Domestic billet prices have been relatively stable in April. Starting in early May, some specifications of billet prices began to rise. Some specifications began a new wave of price increases in late May. In order to improve Pakistani agriculture and increase farmers' income, the Pakistani government plans to allocate 2.5 billion rupees in 2018/2019 to promote the production of cotton (16895, -365.00, -2.11%). On May 7-23, affected by the increase in international cotton prices, Pakistan's cotton yarn export prices were adjusted upwards. The price of Pakistani billet rose steadily with rising water prices.

The US dollar index continued to strengthen in exchange rates, and the US dollar continued to depreciate against the RMB exchange rate in May. On May 30, the exchange rate of RMB against the US dollar was 6.41885 yuan, which was the lowest since January 18, and the devaluation of the RMB led to an increase in the price of imported yarns, which in turn drove the price of billet up.

According to customs statistics, in May 2018, China exported approximately US$23.445 billion worth of textiles and clothing, which was a year-on-year increase of 0.17% and an increase of 9.12% compared with the previous period. The export of textile yarns, fabrics and products was US$11,244 million, an increase of 8.06% year-on-year, and an increase of 6.94% compared with the previous period. Exports of clothing and clothing accessories were US$12,201 million, a year-on-year decrease of 6.15% and a year-on-year increase of 11.20%. Although textiles and garments in India, Pakistan, Vietnam, Indonesia, and other countries have developed rapidly in recent years, the number of orders taken by China's textile, apparel, and foreign trade companies has declined. However, in May, textile and apparel exports continued to pick up, and exports continued to pick up. The United States will first impose a 25% high tariff on China’s $34 billion in goods since July 6. The United States is still reviewing the specific taxation list for China’s remaining goods of US$16 billion. The list currently announced by the United States does not refer to textiles and clothing. It is expected that the export volume will not decrease this month, but the textile industry needs to pay attention to real-time developments in a timely manner.

With the retreat of the industry's "golden three silver four" sales season, the sales of grey cloth gradually entered the off-season. Environmental inspections have been conducted in various places and most chemical parks have been shut down, resulting in a drop in dye production capacity by 0.2 yuan per meter, and printing and dyeing costs have increased substantially. The price of raw cotton yarn in the upper reaches is still high, and the number of downstream orders is not large, resulting in the obstruction of the circulation speed of the grey fabric market. Currently weaving plants are under a lot of pressure to accept orders, and recent price fluctuations of grey fabrics are not significant.

Faced with the list of high tariffs announced by the United States, China will impose tariffs from July 6 on uncombed cotton and short cotton. From January to March of 2018, China imported a total of 348,800 tons of cotton, including US imports of 217,000 tons, an increase of 6.67% year-on-year. On June 14th, the National Development and Reform Commission issued an import cotton that increased 800,000 tons of slip-tax allowance this year. After the increase of tariffs, the increase in the cost of US cotton imports will affect the quantity of US imports of US cotton. The grey cloth industry is currently in the season of poor orders, and orders have declined from the previous period. It is expected that the trade will have little impact on the apparel industry in the short term.