Domestic exports double down in the textile industry deep in "internal worries

"No export before, there are domestic sales propped up, but now it is not enough to export domestic sales!" Zhejiang textile company CEO told the China Economic Herald reporter.

This statement by him was recognized by the industry association. At the recent conference on the economic operation of the textile industry held in 2012, the China Textile Industry Federation stated that from January to July, the production and operation situation of the textile and clothing industry continued to decline, and the growth rate of domestic sales of textile enterprises above designated size was down by 20.3 percentage points year-on-year. The export of the whole industry only increased by 0.3% year-on-year, almost “zero growth”. After deducting the price increase factor, the actual export volume was negative.

Domestic exports have fallen sharply, and corporate losses have increased. According to Sun Huaibin, spokesperson of the China National Textile and Apparel Council, the textile industry has continued its economy since last year due to factors such as sluggish external demand, slowing domestic demand, and widening domestic and overseas cotton spreads. The growth has decelerated, and the growth rate of major economic indicators such as production, exports, and investment have all continued to slow, and the efficiency has declined.

In terms of production, according to data from the National Bureau of Statistics, from January to July, 37,000 textile enterprises above designated size achieved a total industrial output value of 314.47 billion yuan, an increase of 10.9% year-on-year, a decrease of 18.8 percentage points from the same period of last year, compared with the previous year. Quarterly decline of 3.8 percentage points. Among the major categories of products, the growth rate of output of upstream products dropped more clearly. From January to July, the output of chemical fiber and fabrics of enterprises above designated size increased by 12.4% and 10.8% year-on-year, respectively, a decrease of 3.8 and 3.5 percentage points from the same period of last year, compared with the first quarter of this year. Declined by 1.1 and 5.4 percentage points; yarn production increased by 12.9% year-on-year, 1.7 percentage points higher than the same period of last year and 0.2 percentage point lower than the first quarter of this year. The growth rate of output of end products rebounded. From January to July, apparel output increased by 11.8% year-on-year, 0.3% higher than the same period of last year and 3.9 percentage points higher than the first quarter of this year.

In terms of domestic sales, due to the slowdown in domestic macroeconomic growth and the continuing high price level, since 2012, the domestic textile and apparel consumption growth rate has declined. From January to July, the retail sales of clothing, shoes, hats, and needle textiles above designated size in the country increased by 17% year-on-year, which was 7.2% lower than the same period of last year; if the price factor was deducted, the actual growth rate of retail sales was 13%, which was lower than the same period of last year 5.7 Percentage. From January to July, the output value of domestic textile enterprises above designated size was 2507.73 billion yuan, a year-on-year increase of 12.5%, a decrease of 20.3 percentage points from the same period of last year and a decrease of 3.8 percentage points from the first quarter of this year.

On the export side, due to the sluggish demand in the international market, continued widening of domestic and foreign cotton spreads, and the continued rise in production costs, the pressure on China's textile and apparel exports has increased significantly since 2012. According to customs statistics, from January to July, China exported 141.58 billion U.S. dollars worth of textiles and clothing, an increase of only 0.3% year-on-year, a decrease of 25 percentage points from the same period of last year and a decrease of 3.1 percentage points from the first quarter of this year. If the price increase factor is deducted, the actual export volume of the textile industry will be negative. From January to July, the export prices of textiles and clothing in China increased by 2.9% year-on-year, and the number of exports decreased by 2.5% year-on-year, a decrease of 5 percentage points from the same period of last year.

In terms of investment, affected by the slowdown in the economic growth of the industry, textile companies’ investment confidence has declined, investment growth has slowed down, and new projects have decreased. According to data from the National Bureau of Statistics, from January to July 2012, the total investment in fixed assets of the textile industry totaled 416.4 billion yuan, an increase of 16.9% year-on-year, and the growth rate was 19.5 percentage points lower than the same period of last year; the new project 7945 was started. This was a decrease of 9.4% year-on-year and a decrease of 6.3% from the same period of last year.

In such a severe industry situation, the loss of the company has further expanded. According to Sun Huaibin, from January to June, the total profit of textile enterprises above designated size reached 114.79 billion yuan, a year-on-year decrease of 1.9%, and the growth rate was 43.2 percentage points lower than the same period of last year. The sales margin was 4.5%, which was a decrease of 0.5 percentage points year-on-year. The company’s loss was 18.4%, and the losses of loss-making enterprises increased by 124.1% year-on-year. Among the sub-sectors, cotton spinning and chemical fiber were affected by the price fluctuation of raw materials, and the profits of the industry all showed a negative growth trend. From January to June, the chemical fiber industry fell by 52.3%, and the profits of 105 cotton textile backbone enterprises dropped by 52.1%.

In the second half of the year, the situation is still severe. Cotton is the biggest problem. “In the second half of the year, the domestic market will become better and the growth rate will slow down. This is mainly due to the low statistical base of last year, but due to the sluggish external demand and high cotton prices, there are still With continuous increase in costs and other factors, the industry situation is still severe.” Sun Huaibin said that the current economic operation of the industry is still facing many risks, further deepening the adjustment of industrial structure, speeding up the transformation of development methods, and resolving various external risks from the root cause, it is still the whole industry. The fundamental task facing us.

He analyzed that insisting on expanding domestic demand is still an important starting point for macroeconomic control policies. Recently, domestic monetary policy has eased, and prices have gradually declined steadily. With the further effect of regulation and control, it will play a positive role in boosting the growth of domestic demand. On the whole, although the growth rate of clothing domestic consumption during the year will still be lower than the level of the previous year, it will show a gradual increase in the growth rate, and will gradually increase the driving force for the textile industry.

However, he said that the export situation is not optimistic. In the second half of the year, exports will most likely have negative growth. According to relevant statistics, in the first half of 2012, the EU’s total amount of imported textiles and clothing decreased by 6.9% year-on-year, the total amount of US textile and apparel imports approached zero growth, and Japan’s textile and apparel imports only increased by 2.2% year-on-year, a decrease of 10.8 from the same period of last year. Percentage points, the overall international market demand is sluggish. Affected by the continued deterioration of the debt crisis in Europe, the current international market recovery is still facing higher risks. In the latest forecast issued by the International Monetary Authority in mid-July, the global economic growth rate in 2012 will be reduced by 0.1 percentage point to 3.5%, indicating that the global economy The outlook for recovery is not optimistic. It is expected that the overall international market will remain sluggish in 2012, and the export of the textile industry will still lack market momentum for stabilization.

“The biggest problem facing the textile industry is the cotton issue. All the cotton-related industries are negative growth. Our biggest expectation is to reduce the domestic and foreign cotton price gap.” Sun Huaibin said.

According to him, since 2012, domestic cotton prices have always been higher than the international market, and the spread has continued to widen. As of mid-August, domestic cotton prices have risen by more than 5,000 yuan per ton compared to the international market, and the spread has increased by 67% from the beginning of the year. The competitiveness of China's cotton spinning industry chain has been severely reduced, and corporate profits have deteriorated. According to market supply and demand, it is expected that the recent domestic and foreign cotton spreads will be difficult to reduce significantly through market adjustments. In addition, the new round of domestic temporary cotton purchasing and storage policies will start soon, and the issue of cotton price gap between domestic and overseas will still exist, which will still be the primary factor affecting the operation of the textile industry.

At the same time, various pressure factors that have affected the development of the industry in recent years still exist. The cost of production factors such as the employment of textile enterprises continues to increase. According to the survey, the average wage of the textile industry in the first half of the year increased by approximately 15% year-on-year. Statistics show that domestic fuel-power prices increased by 3% from January to July. The financing difficulties and financing problems of enterprises have not yet been completely resolved. The financing costs remain high. In the first half of the year, the interest expenses of enterprises above designated size increased by 29.5% year-on-year, which was higher than the growth rate of main business income of the same period by 19.8 percentage points.

“Overall, the current economic operation of the textile industry is still facing many risks. The industry continues to actively respond to external risks through measures such as deepening structural adjustment and strengthening industry self-regulation. It also expects relevant state policies to support the textile industry as soon as possible to return to a stable and healthy environment. The track of development comes." Sun Huaibin said finally.

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