Abstract: Market Status: According to the feedback to our website from lots of factories, the price of raw material keeps high; the environmental protection department is carrying out a “carpet-style” inspection; RMB exchange rate keeps going up since the beginning of the year, as a result, the profit is reduced bilaterally.
Market Status: According to the feedback to our website from lots of factories, the price of raw material keeps high; the environmental protection department is carrying out a “carpet-style” inspection; RMB exchange rate keeps going up since the beginning of the year, as a result, the profit is reduced bilaterally.

Market Status: According to the feedback to our website from lots of factories, the price of raw material keeps high; the environmental protection department is carrying out a “carpet-style” inspection; RMB exchange rate keeps going up since the beginning of the year, as a result, the profit is reduced bilaterally.

Market Status: According to the feedback to our website from lots of factories, the price of raw material keeps high; the environmental protection department is carrying out a “carpet-style” inspection; RMB exchange rate keeps going up since the beginning of the year, as a result, the profit is reduced bilaterally.

Market status at home:

Firstly, it’s the sorting link.

Recent years, because of the participation of new recycling personnel and  recycling methods, old collectors’ recycling quantity gets small. We get to know from lots of factories that their former suppliers’ supply quantity is obviously smaller than before.

On the other hand, some large-scale used-clothes collectors appeared. They united each other, which kept the price of materials high in a long term. Because foreign orders increases this year and the factories’ demand for raw materials keeps great, most collectors have the confidence not to cut the price.

Secondly, it’s factories’ export link.

The most troublesome problems of export is that, on one hand, the price of raw materials keeps high to keep the cost high, on the other hand, the former suppliers are easy poached by other factories.

On the other hand, RMB exchange rate keeps rising since the beginning of 2017 up to now. In simple terms, RMB has a higher value. Up to now, this link causes 6% of factories’ profit loss.

Thirdly, it’s the processing factories in China.

This kind of factory mainly recycles used clothes such as black material, sweater, cotton and so on, for reutilization. Because there is a serious environmental inspection at home, many middle and small-scaled factories shut down, which made the price of raw materials go down a lot and make the market demand small.

Market status abroad:

Firstly, it’s the global economic market status.

Nowadays, the US dollar rate dropped down from 102 points since the beginning of this year, to about 92 points. The range of the drop is quite obvious. Why shoul we talk about the US dollar rate problem? Because most global trades settle accounts in dollar. Simply speak from the current situation, foreigners can use less money to buy Chinese supplies. It means foreign buyers’ profits get higher.

The price of crude oil basically maintains in 50 dollars throughout this year. Relatively speaking, it’s relatively stable.

Secondly, it’s current market status abroad.

The foreign market status is relatively stable. The purchasing demand will last until the end of the year.

On the other hand, more and more Chinese open their stores in Africa to work on this business, so the competition abroad is more intense and the profit will be influenced, too.

Possible trend conjecture in the future:

Firstly, the purchasing demand abroad keeps high. Most general elections abroad has finished and the whole economic environment has changed little, thus the purchasing demand abroad won’t have obvious changes.

Secondly, there will be more Chinese factories. On the whole, the possibility of combing production and marketing together is getting high.

Thirdly, more and more traders come back to Chine to open their own factories. Since this year, this trend has been more obvious. When they have their own stable sales channels, it’s more likely for them to come back to China to open their factories.

Fourthly, the number of factories at home may reduce. Because of the inspection event in Baiyun District in Guangzhou, the number of factories at home may reduce in a short term. It’s mainly about the safety of the trade. It will turn for the better next year.

Fifthly, whether the environmental inspection will last or not will make a long-term effect on the industry. As it is, it will continue this year.

Key words: situation analysis