April 2020 China Cotton Textile Industry Boom Report

Since the beginning of this year, China's cotton textile industry index has been optimized with reference to the national manufacturing PMI index.

In April, the cotton textile prosperity index was 46.51, down 5.31 compared with March. With the pace of resumption of production and resumption of business in China, the domestic economic operation order is being restored orderly, and the consumer market is gradually warming up. According to the statistics of National Bureau of statistics, in April, the total retail sales of consumer goods totaled 28178 billion yuan, down 7.5% from the same period last year (after deducting the actual price drop by 9.1%), the decline narrowed by 8.3 percentage points from last month. From 1 to April, the total retail sales of consumer goods amounted to 106758 billion yuan, down 16.2% from the nominal level. During the epidemic prevention and control period, the online retail sales of physical commodities increased significantly. From 1 to April, the online retail sales of physical commodities increased by 8.6% over the same period last year, and the growth rate increased by 2.7 percentage points from 1 to March. In order to hedge the negative impact of the epidemic, we should launch more stimulus consumption policies, boost consumer confidence, release consumer demand and achieve social consumption growth. With the accelerated recovery of the domestic consumer market, the positive impact of speed increase in sales of clothing and home textiles and other end products can be smoothly transmitted to the upper and middle reaches, and our cotton textile industry is expected to usher in a revival.

In terms of foreign trade, according to the latest statistics of the General Administration of Customs of China, in April 2020, the export volume of textiles and clothing was 21 billion 361 million US dollars, an increase of 38.43%, an increase of 9.77% over the same period last year. Among them, exports of textiles (including textiles, yarns, fabrics, respirators and other articles) amounted to US $14 billion 620 million 700 thousand, an increase of 49.36% over the same period last year. Exports of garments (including garments and accessories) were US $6 billion 739 million 900 thousand, down 30.31% from the same period last year. The obvious growth of textile exports came mainly from two points: first, the outbreak of the global epidemic since March, and the demand for anti epidemic materials such as overseas masks and protective clothing increased significantly. Two, the textile export was affected by Sino US trade friction in the same period last year, and the base was low. On the whole, demand for clothing and other products has not improved significantly except for protective products. In May, many countries gradually relaxed their prevention and control measures. The "city closure order" and "home ownership order" were gradually lifted, and consumer demand for clothing, shoes and caps is expected to usher in a recovery period.

Raw material purchase price index

In April, the purchasing price index of raw materials was 45.67, down 5.58 compared with March. In March, the price of cotton and non cotton fibers showed an overall trend of fluctuation. According to the varieties, the price of cotton and viscose staple fiber decreased significantly, and the price of polyester staple fiber showed a "trend" trend, and the monthly price decline was smaller than that of cotton and viscose staple fiber. At the beginning of the month, the consensus reached by the major oil exporting countries to achieve a reduction in production led to a rebound in cotton futures prices. However, because the market demand had not improved, the domestic cotton purchase and sale was still in a cold state, and the lack of basic support and a slight decrease in the price were lifted. The price of viscose staple fiber fluctuated slightly in terms of chemical fiber staple, and the price of polyester staple fiber was linked to oil price, which was at a high price in early 4 and about 6300 yuan per ton. Beijing time on the morning of April 21st, WTI5 month crude oil futures settlement price closed at -37.63 U.S. dollars / barrel, the first time in history negative value, polyester staple prices were affected by this, prices fell sharply to less than 6000 yuan.

Specific data, the average price of domestic grade 3128 cotton in the month was 11454 yuan / ton, down 501 yuan / ton, the average CotlookA index was 63.63 cents / helping, the chain fell 4.06 cents / pound; the mainstream viscose fiber average price was 9053 yuan / ton, the chain fell 427 yuan / ton; 1.4D direct spinning polyester short average price was 5787 yuan / ton, the chain fell by 185 yuan / ton.

Raw material inventory index

In April, the stock index of raw materials was 47.45, down 1.26 from March. In April, the rhythm of raw material purchase and use remained gentle. The main reasons were three: first, although the price of cotton rose in April, the market was relatively light, and the market had been in a buyer's market situation of oversupply. Two, the downstream businesses were cautious. Cotton textile production basically maintained low speed and raw material consumption was slow. Three, the negative impact of the global epidemic spreading on the economy. Continue to continue, enterprises are now looking at the stability of the gold flow and the health of the capital chain. According to the China Cotton Textile Industry Association (hereinafter referred to as the China Cotton Association) survey, by the end of April, nearly half of the cotton stocks of the surveyed textile enterprises remained at 1 months or more, and the 30% cotton textile stocks of the surveyed textile enterprises remained at about 15-30 days. In May, there was no breakthrough in the international epidemic prevention and control situation. The market wait-and-see sentiment remained unchanged, and the procurement of raw materials for textile enterprises will remain cautious.

Production index

In April, the production index was 47.24, down 6.96 compared with March. At home, the speed of resumption of business resumed significantly in China, and domestic consumption policies were released in a number of places, and the consumption dynamism was released. However, most of the economic activities were close to semi halting during the period of epidemic restriction, and the consumption capacity declined. The risk is increasing. Due to the above reasons, the downstream businesses are cautious. Most spinning enterprises adopt internal production limiting measures to reduce expenditure and reduce operational risks. During the post epidemic period, the recovery of foreign markets will take some time. Layout of domestic market and deep excavation to meet domestic demand have become the focus of the next stage of production and operation of export oriented textile enterprises. At the beginning of May, some textile enterprises lowered their pressure by early holidays or extended holidays.

Product sales index

In April, the product sales index was 45.33, down 8.33 compared with March. This month, the downstream market is still in a low position, and with the advent of the traditional off-season, the cotton yarn market is "light up and light up", and the price center of gravity continues to descend. In order to clear inventory and return the funds as soon as possible, the price competition is fierce, but the market environment with an oversupply of demand makes the sales of products continue to bear down. Online trading is deserted, and online trading is hot. According to the statistics of National Bureau of statistics, from 1 to April, the retail sales volume of the whole country was 30698 billion yuan, an increase of 1.7% over the same period last year and a decrease of 0.8% from 1 to March. Among them, online retail sales of physical goods amounted to 25751 billion yuan, an increase of 8.6%. In the face of the current difficulties, the textile industry is seeking new changes and opportunities, and has opened sales channels such as live broadcasting, websites, and so on, so as to improve the economic efficiency. However, because the epidemic has a great impact on all walks of life, the consumption ability of the residents has been demoted. After the stabilization of the epidemic is expected, the market has little chance of retaliatory consumption, and the mainstream market will recover slowly and recover the momentum.

Product inventory index

In April, the product inventory index was 46.56, down 2.3 compared with March. This month, the epidemic "internal and external attacks", spinning enterprises are generally facing inventory accumulation, resumption of labor difficult to resume production. The negative impact of the new crown pneumonia epidemic on China is gradually being digested, but the market is still in the doldrums, and the order is scarce. The textile enterprises choose to produce regular varieties for maintaining stable production. In addition, the downward pressure on the international economic situation has increased, and consumer demand has not improved substantially. The export oriented textile enterprises are facing customers' cancellation of orders and delayed delivery, and the stock of products is rising. In May, the price of gauze went down all the way, but because the demand side had no obvious improvement, the shipment was slow. Moreover, with the increase of the production of conventional products, the inventory of "more than output" was still rising.

Business index

In April, the business index was 45.71, down 6.13 compared with March. Recently, countries in Europe and the United States have begun to promote unsealing and encourage enterprises to resume work and public consumption to balance the economic needs of the epidemic, but substantive recovery still takes some time. The world economic outlook report released by the International Monetary Fund (IMF) in April predicts that the global economy will shrink by 3% this year due to the impact of the epidemic. Only China and India in major economies are expected to maintain growth. At present, the international economic situation is not optimistic, the global industrial chain has been hit hard, the demand for overseas markets has shrunk, and the competition in foreign trade will be more intense. China is the most complete and most complete country in textile and apparel industry in the world, and the textile industry has a strong ability to resist risks. At the "darkest moment", China's textile enterprises show strong resilience, find gaps in their own management, product development, marketing capabilities and other aspects, raise standards, and strive to maintain stable operation in the cold winter. At present, we need to dig deep into the domestic market and try to transform the "pain spot" of consumption into a "selling point". It is a matter that most of the spinning enterprises are considering or are already doing with differentiation to jump out of price war and expand sales channels.