Textile Industry: Capacity Expansion To Accelerate Pformation To Value Growth

Cotton prices rise and fall

In 2011, the textile industry slowed down.

First look at the industry situation.

Data show that in the first half of October this year, the fixed assets investment in textile industry decreased year-on-year growth rate; excluding price factors, the number of textile and garment exports increased by only 1.14%.

Look at the current situation of enterprises.

Although the industrial added value of textile enterprises above designated size has maintained a two digit growth rate this year, the situation has become increasingly serious since the second half of this year.

By the end of 9, in the 35 thousand and 600 Textile Enterprises above the national scale, 4218 enterprises were losing money, 11.9% were losing money, and the deficit of loss making enterprises was 10 billion 550 million yuan, an increase of 51.2% over the same period last year.

In particular, since the three quarter, enterprises have generally reflected the poor market environment and operating conditions, and small and micro enterprises have shut down more.

The slow growth of the textile industry is on the one hand restricted by macro factors such as tight financing environment, rising labor costs and other manufacturing industries. On the other hand, it is seriously impacted by the international financial crisis.

From the demand side, the world economic recovery slowed down, and the European debt crisis spread rapidly, resulting in the reduction of orders in the international market.

From the supply side, in order to cope with the international financial crisis, countries generally adopted a loose monetary policy, resulting in such a sharp fluctuation in commodity prices such as cotton.

Cotton price "roller coaster" like the rise and fall, and spread to chemical fiber, silk, hemp and other raw materials, resulting in textile industry in 2011 became the most serious raw material crisis.

It is precisely because of the first and last attack of the industrial chain that many enterprises admit that "the difficulties ahead of 2011 should exceed that of the 2008 financial crisis".

Despite the difficulties and slow growth, the gradual pformation of the textile industry from "capacity expansion" to "value growth" and from "dependence on exports" to "internal and external balance" is fast.

The driving force of the rapid growth of China's textile and clothing exports is changing from quantity driven to price driven.

From 1 to November, China's textile and apparel exports totaled 226 billion 210 million US dollars, up 21.2% from the same period last year, but after deducting price factors, the volume of exports increased by only 1.14%.

Wang Tiankai, President of the China Textile Industry Federation, believes that there are factors such as raw materials, labor and other comprehensive costs that have to raise prices, as well as the relative rise in bargaining power of the whole product.

The supporting role of domestic demand market for the operation of China's textile industry is further consolidated.

In the first three quarters, the domestic sales volume of textile enterprises above Designated Size reached 3 trillion and 196 billion 970 million yuan, an increase of 32.04% over the same period last year, and domestic sales accounted for 82.67% of the total industrial output value, up 1.77 percentage points over the same period last year.

China's textile enterprises' profitability has been increased compared with the same period last year under the combined effect of the strong domestic sales and the acceleration of structural adjustment within the industry.

From 1 to September, the total profit of textile enterprises above Designated Size reached 190 billion 37 million yuan, up 32.5% over the same period last year, and profit growth outperformed sales growth.

Considering the continued expansion of the industry deficit, such profit growth can reflect the widening gap between enterprises. The enterprises that have first pformed and upgraded, have their own brands and scientific and technological strength have shown stronger competitiveness and risk tolerance capabilities in the difficult times of the industry.

Wang Tiankai pointed out that the instability and uncertainty of the world economic recovery are still rising, and the global economy will enter a slow growth period of a longer period. The textile industry must face the slow growth of exports for a long time due to the shrinking international market and insufficient demand.

At the same time, textile enterprises must also realize that the rise of factor cost has certain inevitability and persistence, which will be a greater challenge to the traditional manufacturing industry in the downstream of the industrial chain.

"The textile industry has entered the most critical period of pformation and upgrading.

Innovation is the soul and driving force to promote the upgrading of the industry, and will inject stronger vitality into the enterprises and industries. "