Textile Leather Industry Suffers From Severe Cold

With the decline of export tax rebate, the acceleration of RMB appreciation and the increase of labor cost, the textile industry is under great pressure.

At the same time, textile prices and export growth are in a state of decline, which exacerbated the pressure of textile enterprises.

According to the data released by the National Bureau of statistics, the price of Chinese manufactured goods (PPI) rose 8.2% in May, a record high in recent years.

Among them, food prices rose 11%, general daily consumer goods rose 3.9%, while clothing category rose only 2.4%.

According to the statistical data of sub varieties, almost all the prices of chemical products rose to varying degrees in the price category of chemical products, while polyester filament decreased by 4.6%.

In addition, in May, China's consumer price index CPI rose by 7.7% over the same period last year.

Still at a high level.

Among them, food prices rose by 19.9%%, while clothing prices fell by 1.5% compared with the same period last year, of which clothing prices fell by 1.6%.

At the same time, the national development and Reform Commission data showed that the contract price of the national cotton trading market was 14405 yuan / ton in July 2008, down 55 yuan / ton, or 0.4%; Zhengzhou cotton futures contract price in July 2008 was 14178 yuan / ton, down 386 yuan / ton, or 2.7%.

According to the national cotton market monitoring system survey, as of the end of May, the average sales rate of cotton enterprises was 75%, down 8.3 percentage points from the same period last year.

The main reason for slow sales is that textile enterprises are generally short of funds, compressing raw materials such as cotton and so on.

In addition, according to the customs express statistics, in May, China's textile and clothing exports amounted to 14 billion 400 million US dollars, up 9.7% over the same period last year.

In the 1-5 months of this year, China's textile and clothing exports were US $66 billion 200 million, an increase of 15.4% over the same period last year, an increase of 0.2 percentage points.

From September to May this year, textile and apparel exports totaled 128 billion 400 million US dollars, an increase of 16.7% over the same period last year, an increase of 3.7 percentage points.

"The main reason for the slowdown in textile export growth is that the textile development is facing difficulties due to the acceleration of RMB appreciation since last year, the rising cost of labor and raw materials, the reduction of the export tax rebate rate, and the slowdown in international economic growth," he said.

In this regard, the national development and Reform Commission responsible person said so.

Since September 15, 2006, the export tax rebate rate of textiles has dropped from 13% to 11%.

This is another downward adjustment after the textile export rebate rate dropped from 17% to 4 percentage points in 2003.

In June 19, 2007, the export tax rebate rate for garments, bags, toys and other products dropped from 13% to 11%, and the export tax rebate rate of viscose fiber was reduced to 5%.

So far, textile and garment export products (except viscose fiber) tax rebate rate is 11%.

Under the premise of inflation, coupled with rising costs and the slowdown in textile and clothing exports this year, the textile industry has been a major blow.

Some small and medium-sized textile enterprises are on the verge of bankruptcy.

The situation of the textile industry has a direct impact on the cotton market.

According to the national development and Reform Commission's May cotton market monthly report, in May, the national yarn production was 1 million 900 thousand tons, an increase of 12.8% over the same period last year.

In the 1-5 month of this year, the total output of national yarn was 8 million 340 thousand tons, up 11.6% from the same period last year, and the growth rate dropped by 9 percentage points.

Last September to May this year, China's yarn production totaled 15 million 450 thousand tons, an increase of 11.7% over the same period last year, an increase of 8.6 percentage points.

Meanwhile, imports of cotton are also falling.

According to customs statistics, in May, China imported 240 thousand tons of cotton, an increase of 39 thousand tons over the same period, an increase of 19.4%, a decrease of 23 thousand and 200 tons from the previous month, a decrease of 8.8%, which is lower than the average 275 thousand tons in the past three years.

The import volume of 1 million 30 thousand tons in 1-5 months is 108 thousand tons higher than that of the same period last year, but it is also lower than the average 1 million 200 thousand tons in the past three years.

"The textile industry is suffering the most difficult year in nearly ten years."

For the current situation, there are textile enterprises bosses so sigh.

It can be said that the wind is rough and the waves are not calm.

In view of the current difficulties faced by the textile industry, in mid June, a news came out on a media that the newly established Ministry of information and industrialization recently issued a letter of opinion aimed at solving the current difficulties faced by the textile industry, and is actively soliciting opinions from all sides.

The "opinions" include the textile export rebate rate from 11% to 13%, the export rebate rate from 11% to 15%, the cotton import slip tax reduced to 570-357, equivalent to 5% to 3%, has been implemented since June 5th, to exempt some textile machinery, automatic winding machine import tariffs; take measures to moderately slow down the appreciation of the RMB exchange rate; moderately solve the textile and garment industry liquidity problems and other issues.

Obviously, if the suggestion in the opinion really gets the support of the government, it will be a shot in the arm for textile enterprises.

However, at the moment, when everything is still speculation, the textile industry still needs to experience "severe cold".