Textile Exports Grew By Nearly Zero.

2011, China

Last year, the growth indicators of the textile industry were all red.

At the seventh China Textile round table annual meeting held recently, Wang Tiankai, President of the China Textile Industry Federation, said that the operational risks faced by the textile industry increased significantly in 2011 compared with the previous year. The growth of industrial efficiency is particularly prominent.

The tight external environment has become a market driven mechanism. It is expected that the textile industry will usher in a new round of industry in 2012.

Status quo --

Output value and profit growth slowed down, and the growth of export volume approached zero.

Last year, the growth rate of textile production continued to slow down.

From 1 to November last year, 36 thousand Textile Enterprises above Designated Size reached 4 trillion and 952 billion 640 million yuan in total industrial output value, an increase of 27.5% over the same period last year, but compared with the end of the first quarter, output growth slowed by 4.1 percentage points.

Although industry profits have increased, the growth rate is also declining.

From 1 to October 2011, the total profits of textile enterprises above Designated Size totaled 215 billion 560 million yuan, up 29% from the same period last year, and the growth rate dropped by 24.6 percentage points compared with the first quarter.

Profit growth in October was only 7.8%, down 40 percentage points from the beginning of the year.

According to the key industry cluster survey data of the Federation, from 1 to October, the profit of small enterprises under the cluster area increased by 11.4% compared with the same period last year, and the growth rate was less than 40% of the enterprises above the scale.

The operation of small and medium sized enterprises below scale is facing great difficulties.

The growth rate of textile industry investment is also slowing down.

From 1 to November last year, the total investment in fixed assets of the textile industry over 5 million yuan reached 610 billion 160 million yuan, an increase of 34.7% over the same period last year. The growth rate dropped by 3.8 percentage points from 1 to March, and the number of new projects was 13129, up only 1.8% from the same period last year.

The slowdown in investment and new construction projects also reflects a decline in market confidence and willingness to invest.

What is more worth pointing out is that as a large exporter, the export volume of textile industry increased nearly zero last year.

According to customs data, from 2011 to November, the total export volume of textiles and garments was 231 billion 840 million US dollars, up 21% from the same period last year, and the growth rate was 6 percentage points lower than that at the end of April. 1.

Excluding price factors, the number of textile and garment exports increased by only 0.5% from 1 to November, and the number of garment exports increased by only 0.1%. Some export orders were pferred to low cost countries around the world, and the demand for terminal market in the international market was not optimistic.

Why -

Risk in raw material market and loss of international orders

Wang Tiankai analysis shows that the growth rate of the industry continues to slow down, mainly due to fluctuations in raw material prices, increased production and financing costs, and insufficient external demand.

Look at the raw materials first.

In 2011, domestic cotton prices showed a trend of ups and downs, which not only caused the production and marketing of cotton spinning enterprises to be sluggish, stock potential losses and profits declined, but also the negative effects were pmitted along the industrial chain, which affected the normal production and market confidence of the upstream and downstream enterprises, and seriously hampered the stable operation of the whole textile industry.

"The sharp fluctuations in cotton prices are related to many factors, such as output increase, demand change, credit contraction and market speculation. However, China lacks institutional guarantee to effectively curb fluctuations in domestic cotton prices and balance the interests of interested parties."

Wang Tiankai analysis, since September 2011, in the role of the state's temporary purchasing and storage policy, the domestic cotton prices remained basically stable, but the international cotton prices continued to decline, and the difference between domestic and foreign cotton prices continued to widen.

After the end of March 2012, the domestic cotton price trend is still hard to predict, and there is still a big risk in cotton and other raw material markets.

Look at the cost of production again.

Wang Tiankai said that in 2011, the prices of all key elements in the textile industry continued to rise, of which the increase in labor costs was most prominent, up 15% over the same period.

While the cost of various production factors continues to rise, the increase in interest rates and appreciation of the renminbi will increase the pressure on enterprises to face rising costs.

The textile industry is dominated by small and medium-sized enterprises, and the difficulty of financing is an old problem.

The tightening of domestic monetary policy in 2011 has made textile SMEs face a series of problems, such as difficulty in loans, interest rate rise and risk of private lending, and so on.

Finally, look at the international market.

Affected by the slow global economic recovery and the European sovereign debt crisis, the demand for textile and apparel market in 2011 was low.

Pakistan, Vietnam and other developing countries, relying on lower price advantage, to a certain extent, led to the loss of orders in China.

According to the survey, about 15% of the small processing enterprises in the eastern part of the eastern region are in a state of stop production and half stop production.

"The order loss of China's export processing small and medium-sized enterprises is related to domestic cost and policy factors, and is also the result of the adjustment of the division and layout structure of the international textile industry, but if such orders are pferred too fast, the business stoppage area will further expand."

Wang Tiankai said.

Prediction --

The difficulties faced by small and medium-sized processing enterprises below scale will be more prominent.

The internal and external environment faced by the textile industry in 2012 is still very complex, especially in the first half of the year.

On the one hand, it is expected that the growth of demand in the international market will remain weak, and the shortage of demand, competition pressure and trade frictions faced by export enterprises will become more prominent.

On the other hand, the textile industry may face greater difficulties if prices of raw materials fluctuate, labor prices and other factors rise, and the financing environment of SMEs has not been substantially improved.

Wang Tiankai predicts that the growth rate of the textile industry will slow down in 2012 compared with that of last year. The decline in the export and profit growth rate of the industry will be more obvious. The difficulties faced by the small and medium-sized processing enterprises below the scale will be more prominent.

Nevertheless, he remains optimistic about the industry outlook.

"The basic attributes of textile and clothing as necessities of life determine that domestic and foreign market demand will not shrink significantly," Wang Tiankai analyzed. From 1 to November last year, the domestic sales value of textile enterprises above Designated Size reached 4 trillion and 10 billion 110 million yuan, an increase of 30.3% over the same period last year, and the share of domestic sales value in sales value reached 82.9%, an increase of 1.8 percentage points over the same period last year.

Domestic demand is continuing to expand its contribution to the textile industry.

"With the gradual easing of inflationary pressures, the domestic demand for textile and clothing is steadily expanding and continues to be the primary support for the development of the textile industry."

At the same time, the market forced mechanism formed by the tight external environment will bring a new round of industry reshuffle and accelerate the adjustment and upgrading of the textile industry.

On the one hand, small and medium-sized enterprises and coastal export processing enterprises will face greater pressure.

"In October 2011, the State Council promulgated a series of policies and measures to broaden the financing channels for small and micro enterprises, but the implementation effect is not obvious in the textile industry."

Wang Tiankai believes that the characteristics of small scale and limited profitability of the textile enterprises are difficult to fundamentally change. A series of services and financing mechanisms for SMEs will be a long-term gradual process. The risk of enterprise capital chain still needs to be highly concerned.

On the other hand, under the pressure of economic downfall, the total volume of trade conflicts will be highlighted, and international trade frictions may intensify.

"The more difficult times, the more the textile industry must strengthen self-discipline, standardize market order and trade behavior, and prevent excessive competition.

At the same time, enterprises should speed up structural adjustment, do a good job in internal strength, and work hard to develop new products, new channels and new markets.

Wang Tiankai said.