On the afternoon of April 19, 2022, Mr. Le Tien Truong - Chairman of the Board of Directors of Vietnam National Textile and Garment Group (Vinatex) held an online meeting with leaders of yarn enterprises to forecast the market situation and take action. on material preparation and discuss orientation for the next 1-2 months.

Many solutions were offered by the leaders of the Group and enterprises at the Conference.

At the meeting, Chairman of the Board of Directors of Vinatex Le Tien Truong said that on April 18, cotton price reached the highest level in 52 weeks at about 146 UScents/pound. Compared to the lowest price in the past 52 weeks, cotton prices have increased by about 85%. Although the price of cotton has increased, the price of Yarn is decreasing, including some types of Yarn, the selling price is lower than the price of cotton. This is a special point that requires business leaders to come up with a plan to proactively respond. Besides, the largest export market of Vietnam's yarn industry, China, is sticking to the Zero Covid strategy with about 30% of the population under blockade. In which, the provinces with the number of covid cases over 6,000, all located on the east coast, are the main production areas of China's textile industry with about 80% of output. According to the schedule, China will close until the end of April 25 if the epidemic does not arise. However, then China will have a holiday on May 1 and May 4, so if the epidemic worsens, it is likely that China will be closed from May 1-4. If this happens, it will be a full month when the Chinese market closes, reducing the demand and selling price of Yarn.

Besides, the Russia-Ukraine conflict is forecasted in the most optimistic direction to end in June at the earliest, so the supply chain disruption, logistics crisis, and complicated currency will last until the end of the second quarter. 2022. Given the above uncertainties, the World Bank has lowered its global growth forecast to 3.2%, nearly halving from the previous year. “All of this is putting us in the worst-case scenario forecasted in mid-March by the Group. If this trend continues to spread to the garment industry in the near future, it is forecast that this industry will also face difficulties”, emphasized Vinatex Chairman Le Tien Truong.

At the meeting, business leaders also discussed the situation and offered solutions to deal with the bad situation of the market. The immediate solution set by Yarn enterprises to control supply is not to run at maximum production speed; focus on maintenance and equipment maintenance; relax labor in the upcoming holidays; towards the production of high quality yarn products; balance short-term cotton purchases, ensure production and monitor market developments; saving production costs as well as finding suitable orders on the basis of selling prices to ensure capital flow…

Chairman Le Tien Truong agreed with the viewpoints and directions for controlling cotton supply and yarn demand that enterprises have proposed. Vinatex leaders emphasized, new market movements show that from now until the end of June, yarn demand will be weak, the number of orders will decrease, mainly orders will be filled until May 20. Faced with these difficulties, enterprises need to calculate the appropriate price ground to be able to buy short-term cotton to maintain production; consider the possibility of stockpiling yarn products to wait for the market to stabilize with financial support… The Yarn Board calculates and considers options for stabilizing raw materials for businesses in the immediate future.

PV

https://vinatex.com.vn/vinatex-du-bao-thi-truong-nganh-soi/

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