Textile Clothing Industry To Pick Up &Nbsp, Downside Risks Increased

Since 2010,

Domestic sales performance is improving, supporting role is strengthened.

Since 2010, the total retail sales of consumer goods in China has been steadily rising since last year, and has become a stabilizing factor in promoting China's economic recovery, and has continued to play an important supporting role in promoting the development of China's textile industry.

In 2010 1~5, China's clothing retail sales increased by 23.1% over the same period last year, which is 4.9 percentage points higher than that of the total retail sales of social consumer goods.

Over the same period, China's textile enterprises above Designated Size realized 1 trillion and 347 billion 636 million yuan of domestic sales value, an increase of 29.80% over the same period last year, a 20.38 percentage point increase from the same period last year, while the proportion of domestic output value increased by nearly 2 percentage points over the same period last year.

Exports have markedly improved.

The export of textile industry showed a marked upward trend, thanks to the resumption of the international market, the increase in demand for replenishment of buyers, and the combined effect of some domestic enterprises in order to avoid the export losses arising from the appreciation of the renminbi.

In 2010 1~5, China's textile and clothing exports totaled 72 billion 205 million US dollars, up 19.52% over the same period last year, and the growth rate was 30.65 percentage points higher than that of the same period last year, which is 3.76 percentage points higher than that of 1~4 months.

Among them, textile exports amounted to 30 billion 552 million yuan, an increase of 29.53% over the same period last year, and clothing exports amounted to $41 billion 653 million, an increase of 13.12% over the same period last year.

Textile exports grew faster than clothing, and accounted for 3.26 percentage points of total textile and clothing exports compared with the same period last year.

This shows that, on the one hand, the export price of some textile products has been improved due to the rising price of raw materials. On the other hand, it is also a rebound in the textile industry of neighboring competitors, and more efforts are being made to import relevant supporting products.

Production is growing faster, but there are signs of slowdown.

In 2010 1~5 months, the total output value of China's textile industry above 5.3 000 scale enterprises totaled 1 trillion and 686 billion 522 million yuan, an increase of 26.55% over the same period last year, and the growth rate increased by 21.34 percentage points over the same period last year.

Vertical comparison, the growth rate is the highest level in the same period in recent years. However, the horizontal comparison shows that the growth rate of production in 1~5 months is 0.50, 0.43 and 0.14 percentage points lower than that in 1~2 months, 1~3 months and 1~4 months this year, showing a gradual slowdown in growth.

Over the same period, the output growth rate of major textile products also showed a relatively fast growth trend, but the growth rate of some products, especially the front-end products of the industrial chain, slowed down compared with the previous months.

According to statistics, 1~5 months, textile production of textile enterprises above designated size increased by 15.86% compared with the same period last year, 8.03 percentage points faster than the same period last year, but the growth rate of 1~4 and 1~3 months decreased by 2.75 and 4.14 percentage points respectively. The yarn production increased by 17.41% over the same period last year, 8.39 points faster than that of the same period last year, but the growth rate of 1~4 and 1~3 decreased 1.29 and 2.21 percentage points respectively this year.

Steady growth in investment

Since the beginning of this year, affected by the rapid growth of domestic demand market and the recovery of exports, the investment in fixed assets of China's textile enterprises has increased steadily, and the pace of regional structural adjustment has been further accelerated.

According to statistics, in 2010 1~5 months, the total amount of fixed assets investment in the textile industry over 5 million yuan reached 116 billion 187 million yuan, an increase of 19.87% over the same period last year. The growth rate was 14.17 percentage points faster than that of the same period last year, but it slowed down 0.08 percentage points compared with 1~4 months this year.

From the perspective of the regional structure of the industry investment, the investment growth rate in the central region has reached 38.15%, and the investment growth rate in the western region has reached 45.64%, which is higher than the average growth rate of the whole industry by 18.28 percentage points and 25.77 percentage points respectively.

At the same time, the proportion of investment in the central and western regions has increased by 6.29 percentage points over the same period last year, reaching 44.27%, reflecting the pace of regional structural adjustment in China's textile industry.

{page_break}

Profitability has improved significantly and operation quality has been strengthened.

Since the beginning of this year, the profitability of China's textile industry has improved significantly compared with the same period last year, with the significant increase in exports, the continuous improvement of domestic sales and the acceleration of structural adjustment within the industry.

According to statistics, in 2010 1~5, the total profits of textile enterprises above Designated Size amounted to 71 billion 901 million yuan, up 61.10% over the same period last year, and the growth rate increased by 61.24 percentage points over the same period last year.

The profit margin of the whole industry was 4.43%, an increase of 0.91 percentage points over the same period last year.

At the same time, the operation quality indicators of the industry have also been improved.

According to statistics, in 2010 1~5 months, the output value of new products of textile enterprises above designated size increased by 34.91%, the growth rate was 8.36 percentage points higher than the total industrial output value, and the output value of new products reached 6.56%, representing a 0.41 percentage point increase over the same period last year.

Over the same period, the labour productivity of Enterprises above the industrial scale (calculated according to the gross industrial output value) was 378 thousand and 300 yuan / person, an increase of 24.87% over the same period last year.

The three fee ratio of the industry was 6.03%, down 0.40 percentage points from the same period last year.

The turnover rate of finished products was 18.71 times per year, up 25.12% from the same period last year.

The downside risk is still large.

Overall, the economic operation of China's textile industry is still showing a steady upward trend, but at this stage, the cost pressures faced by the textile industry are increasingly prominent, and the international market environment is very complex, making the downside risk of the industry still larger.

Prices of production factors go up too fast.

This year, prices of cotton and other raw materials have continued to rise.

According to the relevant data, by July 14th, the 328 grade cotton in China has risen to 18403 yuan / ton.

The high cotton prices make the production enterprises miserable.

With the continuous increase of labor cost and fuel power cost, the high price of production factor has become the prominent pressure in the current industry operation.

RMB appreciation expectations continue to increase

The reform of RMB exchange rate has started again, which has enhanced the flexibility of RMB exchange rate.

At present, the renminbi shows a gradual appreciation in the concussion.

According to relevant data, in July 12th, the yuan hit a new high since the reform of the exchange rate, and the middle price of the US dollar reached 6.7718, which will undoubtedly affect the export of the industry.

Slowdown in overseas economic recovery

The eurozone's sovereign debt crisis is still lingering. Data on the recent purchasing managers' index and retail market growth in the US market also show signs of slowing economic recovery.

The prospect of global economic recovery is so perplexing that the export market faced by China's textile industry is hardly optimistic.

Editor's comment: it is indeed gratifying to see that the textile and garment industry is gradually getting warmer. But the potential crisis behind this has to worry a lot. How to make great progress in the environment of RMB appreciation, foreign economic downturn and soaring raw material prices? This is the problem that enterprises should first consider.