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| Jiangsu Mills Attempt to Adjust Production |
The profit squeeze on China's textile mills continues. In Jiangsu Province, a very important market, mills are reacting in a variety of ways to this situation. Spinners and weavers of man-made fiber appear to be the most adversely affected, with some operations having halted output. Other mills are continuing to adjust output according to the level of demand, while a few mills have shut one to two production lines in an effort to control inventories and save on electricity costs. Mills have also begun to discharge employees in order to increase efficiency. Increased electricity costs and a shortage of working capital loans are now two driving factors influencing mill decisions.
In Shandong Province, the largest yarn and fabric producing area in China, mills have begun to switch from summer fabrics to the heavier, thicker winter fabrics, which has changed the yarn production mix and increased the overall level of cotton consumption.
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