Manufacturing Enterprises Overcapacity &Nbsp; Brand Clothing Growth Decline

Zhang Bin, chief analyst of the state textile and apparel industry, said in an interview with reporters that the past

Manufacturing enterprises overcapacity, brand clothing growth decline

Reporter: the whole textile and garment industry includes many sub sectors. How do you divide them?

Zhang Bin: we usually divide the textile and garment industry into three blocks, one is raw materials, including cotton, chemical fiber, etc.; the second is manufacturing and exporting, and the reason why they are put together is that up to now, 50% or more of our manufacturing companies are targeting exports, and third are domestic sales, especially the well-known brand enterprises.

Reporter: from the four quarter, what is the situation of these three fields?

Zhang Bin: first of all, the price of raw materials is stabilizing.

As new cotton has been listed in large quantities, demand and supply are not high, supply is increasing and prices are weak. In addition, the state's purchase and storage system will also hold cotton prices.

The price of cotton in the four quarter is expected to be between 18 thousand ~2 yuan per ton and at the bottom.

In addition, viscose, spandex and polyester may all oscillate at the bottom.

{page_break}

For export and manufacturing enterprises, the fourth quarter will be a rather miserable quarter, worse than the three quarter, mainly due to overcapacity.

Because of the relatively loose funds in 2009~2010, many enterprises have invested a lot in production capacity. These capacities are basically released this year, but the orders of these enterprises are not enough.

Their feelings are even worse than in 2008, because in 2008, even though the order was insufficient, the enterprises had a family base and no debts, so they could "close the door and twist mahjong".

Now the fixed assets investment of enterprises is very large, interest expense and depreciation are more severe, so it can be said that they are operating in debt.

Moreover, since the price of labor has risen too fast since 2009, a large number of low-end orders have been lost from China and will not come back again.

This means that China's textile exports are basically in the high-end.

The amount of exports will rise and the volume will drop.

The third one is the retail market of textile and garment, or domestic market.

Domestic demand has maintained two digit growth, but if the macro-economy goes a little bit, all industries will be hard to escape.

I think that in a long-term and sustained growth context, there will be a trough in the medium term growth. The time may be one year or two years.

Starting from May this year, the sales volume and sales volume of clothing has a downward trend, whether from the statistical reports of department stores or the survey of manufacturers and agents.

From the wholesale and retail sales volume, the three quarter sales showed negative growth, 1~8 month relative growth of 4.6%, which is the first time in many years that sales growth is below two digits.

This slowdown will last until at least the first half of next year, and the situation will not change until the second half of next year or the year after next.

Reporter: what is the reason behind the slowdown?

Zhang Bin: there are two main reasons.

One is that the macro economy began to move down from the fourth quarter of last year. The consumption domain is closely related to the macro economy, but consumption will lag for half a year or so.

The second reason is cotton.