International Monopoly Of Raw Materials Aggravate China's Manufacturing Risks

From international organizations, senior leaders to scholars, people have begun to pay attention to and judge whether the economy will have a two bottom finding. The main reason for the two dip is: the recovery of countries' economies is relatively slow, some countries unemployment rate Europe's debt crisis is likely to drag down the European economic recovery. At the same time, the effect of high fiscal deficit and loose monetary policy began to fade.

On the contrary, the insistence that the two bottom will not appear is that monetary policy, industrial policy and credit policy have achieved obvious results. Employment data, manufacturing orders and corporate earnings indicators all show that the prospects for recovery of the US economy will continue. In the long run, China's export cost advantage will be maintained, and the Chinese economy will continue to obtain kinetic energy from outside and maintain steady growth.

June released by the General Administration of Customs Import and export Data show that China's monthly export value and import and export value have set a new record in July 2008. In June, the value of imports and exports grew by 39.2%, and exports increased by 43.9%, which continued the momentum of continuous growth in imports and exports in the two quarter. This data seems to support the view that the economy will not have a two dip, which helps to dispel pessimism, but has not reached a very optimistic level.

The data in June are partly due to the result of the surprise replenishment of the enterprises in Europe and America since 2009, and on the other hand, the lag of the peak imports at the end of the year. China's export growth will also slow down when the European and American stock returns to normal. In fact, the number of orders for general consumer goods such as steel products, light industries and textiles has declined to a certain extent, and orders for electronic and consumer products, machinery and other mechanical and electrical products have begun to show weakness.

The "Spring River heating duck prophet" behind the complicated market is the key to truly understand and determine the trend of the economy. Through the investigation of export enterprises, it is found that the increasingly strong monopoly of raw materials is squeezing the profit margins of enterprises and exacerbating the two cold waves.

Participating in the world Production division system Against this background, the competitiveness of Chinese enterprises depends on the cost of raw materials, labor costs and transaction costs. With the transformation of labor supply and demand and the implementation of the new labor law, labor costs show a steady upward trend, and it is extremely difficult to turn around. In the absence of a significant reduction in transaction costs, the cost of raw materials has become the most important factor restricting export enterprises. When the cost of raw materials increases substantially, and the European and American markets do not boom rapidly, the survival space of enterprises will shrink.

The possible foundation for the monopoly of China's raw materials is the distortion of the industrial chain, that is, the monopoly operation of the upstream industry and the free competition of the downstream industries. Because the downstream industry is facing a fully competitive international market, enterprises are only recipients of balanced prices, and profits can only change with costs. The monopolistic industries in the upstream industry chain are restricted by the relevant national policies. There are few effective competitors in the domestic market. When foreign competitors are restricted, monopoly industries can easily make huge profits by raising the price of plateau materials, while the cost advantage of competitive industries is losing step by step and eventually withdrawing from the depressed international market.

Take the textile industry as an example, this traditional Chinese bulk export commodity industry is suffering from the impact of raw material monopoly. According to foreign research institutions, the price of textile raw materials, including synthetic fiber and organic materials, rose by 44% to 65% at the end of last year. The fastest rise in chemical fiber materials is acrylic fiber, with a price increase of 80%. In addition, the cost of silk has surged to its highest level in 15 years, according to the Ministry of Commerce, citing foreign media. Cotton prices have risen nearly 70% since November 2008. Although some have attributed the price explosion to the compression capacity of yarn producers for several years. But it is undeniable that because the non cotton textile materials are mostly petroleum products, the monopolistic petrochemical industry has strong pricing power. Raising prices is an inevitable choice for all monopolist to get huge profits. However, raw material monopolist seldom considered that the price of raw materials in the upper reaches of the upper reaches of the 2010 was soaring, which may cause the downstream textile and clothing consumption market to be weak and damage to the manufacturing industry.

It is also worth noting that the average import price in June has maintained a marked upward trend in the first 5 months. The import price of iron ore, soybeans and other commodities is not small, showing the strength of the international raw material monopoly organization. Under the double squeeze of international raw material monopoly price and monopoly price of domestic raw materials, the risk that China's economy may be dragged into the bottom is increasing.