Customs Data: Export Reaches A New High In 20 Years After China'S Entry Into WTO

2021 marks the 20th anniversary of China's accession to the WTO. In the past 20 years, China's textile and garment trade has experienced a process from extensive rapid growth to rational growth. The average annual growth rate of trade volume was 8.7%, of which the export volume expanded from 50 billion US dollars to more than 300 billion US dollars, with an average annual growth of 9.5%, and the import volume doubled, with an average annual growth of 3.7%.

Data source: Based on the data of China Customs

The fastest growth period of export was mainly concentrated in the first five years after China's accession to the WTO and the two years after the US subprime mortgage crisis. The average annual growth rate was more than or close to 20%. After that, it entered the rational growth range, especially during the 13th Five Year Plan Period, the overall growth rate slowed down to less than 1%. The pattern of foreign trade has gradually evolved from the traditional mode to the new foreign trade situation, and the export market structure has been further diversified. The rapid development of new trade models and platforms such as cross-border e-commerce and market procurement provides more choices and opportunities for foreign trade enterprises. The export markets above the level of US $10 million have expanded from 115 countries and regions at the beginning of China's accession to the WTO to 164, "one belt and one road" countries and regions have become emerging markets with great potential. The transformation of new and old driving forces in foreign trade has been accelerated, and the focus has shifted from simply focusing on quantity growth to focusing on quality improvement. At the beginning of China's accession to the WTO, low value-added garment processing was the main export commodities, accounting for 68% of the total exports. In the first year of the "14th five year plan", the export proportion of intermediate products and industrial textiles increased to 46%, and the gap with the proportion of clothing rapidly narrowed. The textile industry has put quality and efficiency improvement, innovation driven, energy conservation and emission reduction, social responsibility construction and other high-quality development factors in the first place. Enterprises strive to be the single champion of the manufacturing industry. A large number of outstanding enterprises with different characteristics have emerged in China, and hundreds of industrial clusters with complete upstream and downstream supporting facilities centered on superior products have been formed. We should strengthen the consensus on cooperation with neighboring countries, actively "go out" layout, and basically form a China ASEAN Industrial Synergy region with China as the core. Fully optimize the allocation of resources, promote the export of intermediate and final consumer goods of neighboring countries and China, and realize common development. China's textile and clothing industry and foreign trade development have sufficient endogenous power.

Today, the external trade environment we are facing has changed significantly. The golden period of international trade growth has basically ended, globalization has entered the "second half", and systemic risks have increased significantly. The global economy and trade have been troubled by the anti globalization trend and the unfinished epidemic situation. It is expected that the next five to 10 years will be a period of accelerated restructuring without major changes in a century, and a critical period of global political and economic turbulence. The uncertainty of various factors interwoven with the epidemic situation poses new challenges to industry operators and foreign traders. As far as the textile and garment industry is concerned, it has adapted to the pace of global economic integration and expansion and opening up for many years. The coordination of global industrial chain and supply chain has become the premise to ensure the stable development of textile and garment industry. Enterprises can also face the expansion of industry outward migration, actively participate in and accept lean production, and advocate reducing inventory. Under this development mode, the industry has been able to maintain a good and smooth operation for many years. However, the continuous fermentation of the epidemic makes the neglected underlying crisis gradually appear: once the industrial chain and supply chain break, a series of domino effects will be caused, which will threaten the seemingly stable industrial structure. The U.S. legislative crackdown on Xinjiang cotton, the once-in-a-year measures to limit production and electricity, soaring prices of raw materials, global logistics obstacles, and soaring freight rates make the production and export in 2021 encounter unprecedented difficulties. On the one hand, a large number of orders flow into Xinjiang, resulting in insufficient production capacity; On the other hand, the supply chain is forced to break down, the upstream lacks raw materials, the midstream production lacks electricity and human resources, and the downstream delivery logistics is blocked, resulting in more tight capital flow, and the enterprise's profit is meager or even unprofitable.

In the face of the unknown future, the government and industry organizations have the responsibility to help enterprises grasp the opportunity of the epidemic and after the epidemic, speed up the adjustment of strategic thinking, and improve the foreign trade pricing power and discourse power; Diversify the supply channels, appropriately disperse the geographical distribution of suppliers, and reduce the dependence on single source; Speed up the layout of international and domestic dual circulation construction, and further expand the external market; Improve the research quality and information release speed at both ends of the industrial chain supply, assist enterprises to timely adjust the inventory scale and delivery time, and strive to lead enterprises to break through the bottleneck in the era of great change, and take the lead in the new competition track after the epidemic.

Annual analysis

Overcome multiple disadvantageous factors and set a new high for export in the whole year

Analysis of China's textile and garment foreign trade in 2021

In 2021, the characteristics of global political and economic instability and uncertainty caused by the new crown pneumonia epidemic are further highlighted. China's foreign trade environment is aggravated by the superposition of the epidemic situation and multiple factors, and the global industrial chain and supply chain are exposed to vulnerability under the impact of the epidemic. The shortage of raw materials and power supply, the soaring prices of means of production and sea freight, the appreciation of RMB and other adverse factors interweave, forming a huge challenge to China's textile and clothing export. With the support and encouragement of the state's active and effective prevention and control measures and policies to stabilize the economy and export, the textile and garment industry has overcome many difficulties, strengthened the cooperation between the upstream and downstream of the industrial chain and the supply chain, seized the rare window of overseas order outbreak period and the opportunity of order backflow, so as to realize the over expected export growth. In 2021, the cumulative export volume of textiles and clothing will exceed 300 billion US dollars for the first time, setting a record high, and realizing the start of the 14th five year plan for textile and garment foreign trade. In 2021, the import and export trade volume of textiles and clothing was 351.18 billion US dollars, with a year-on-year increase of 9.8% and an average growth of 8.9% in two years. Among them, exports reached 322.71 billion US dollars, an increase of 9%, with an average increase of 9% in two years; Imports reached US $28.47 billion, up 20.5%, with an average increase of 7.5% in two years; The accumulated trade surplus reached 294.24 billion US dollars, an increase of 8%, and an average increase of 9.2% in two years. This report card reflects the strong tenacity and potential of China's textile and garment industry under difficulties, as well as the original intention and persistence of building a strong textile country.

The export showed a gradient growth in each quarter

In the first quarter of 2021, the export of textile and clothing is stable on the whole, with a cumulative export value of 66.41 billion US dollars. Under the low base effect, the export of textile and clothing in the first quarter grows rapidly, with an increase of 43.5%. In the second quarter, due to the rise of the year-on-year base and the impact of the fall in the export of epidemic prevention materials, the export in that quarter was 76.79 billion US dollars, a decrease of 5%, but still higher than that in the same period of 2019. Since the third quarter, the proportion of anti epidemic materials exports has continued to fall, and the overall export has returned to the pattern of traditional commodities, and the monthly export has gradually rebounded. Especially at the end of the quarter, the epidemic situation in Southeast Asia and other places repeatedly intensified, causing orders to flow back to China and expanding China's export share. In September, exports began to grow again, with a cumulative export of 89.61 billion U.S. dollars, a decrease of 2.6%, narrower than that of the previous quarter. In the fourth quarter, the improvement of the epidemic situation in Southeast Asia led to a rebound in the demand for textile intermediate goods. Due to the poor logistics in Europe and the United States, goods were prepared in advance, and consumer demand continued to expand. Under the influence of many factors, the export volume in the current quarter reached 89.89 billion US dollars, and the export growth in the current quarter rose rapidly to 16.8%. The export volume in each quarter of the whole year showed a trend of gradual increase in value and a U-shaped reversal in growth.

Data source: Based on the data of China Customs

Data source: Based on the data of China Customs

Strong demand for home textile products and home clothes

Epidemic prevention and control and isolation have launched a global "home mode". Consumers spend more time at home, and their service consumption is forced to reduce. They spend more on "home-based" consumer goods such as furniture, clothing and toys, computers and electronic products. From the perspective of textile and clothing export market, developed countries such as Europe and the United States are still the most important consumers. However, European and American consumers still make rational choices to purchase clothing products from China, which has an efficient and stable industrial chain. The United States and the European Union are still the largest end consumer goods markets in China, accounting for 1 / 3 of China's total textile and clothing exports. In particular, the United States accounted for 18% of China's export share in 2021, although the proportion was lower than that in 2020, it was 1.4% larger than that in 2019 before the epidemic, and its position as the largest market remained stable. In 2021, China's textile and clothing exports to the United States reached 58.09 billion US dollars, an increase of 5%. Among them, the export of household textiles for large categories of commodities increased by 32%, and that of knitwear clothing increased by 39.1%, of which knitted clothing suitable for home use increased by nearly 60%. Textile and clothing exports to the EU amounted to US $48.5 billion, down 10%, mainly due to epidemic prevention products. Household textiles for major commodities increased by 27%, knitwear garments by 20.4%, and knitted garments increased by nearly 40%. Textile and clothing exports to Japan totaled US $20.39 billion, down 6.9%, of which household textiles increased by 9.7%, knitwear by 7.5%, and knitwear by 14.5%.

The expansion of demand for downstream products has led to a sharp increase in the import of intermediate textile products from ASEAN and other developing countries. In 2021, China's textile and clothing exports to ASEAN reached US $49.66 billion, an increase of 25%. Among them, yarn fabrics of major commodities increased by 28.3%, while yarn fabrics exported to Bangladesh and India in South Asia increased by 61.5% and 88.5% respectively, far exceeding the levels of last year and before the epidemic.

The proportion of countries along the belt and road has risen rapidly. In 2021, China's textile and clothing exports to countries along the belt and road initiative totaled US $115.53 billion, accounting for 35.8% of the total export, up 4.5% compared with 2020, and the export volume increased by 24.8% year-on-year and 17.5% higher than that before the epidemic.

Clothing and other major categories of goods to play the main export

After the normalization of global epidemic prevention and control, China's export of national defense epidemic products has gradually declined. The proportion of medical masks and protective clothing exports in the total exports has decreased to 5%, and the cumulative export volume has decreased by 75.5%. The export pattern is dominated by clothing, yarn fabrics, household textiles and other major commodities. Yarn, fabrics, home textiles and knitwear clothing accounted for 76% of the total exports, with the export volume increasing by 43.6%, 34.4%, 27.9% and 26.3% respectively. After excluding epidemic prevention products, the export of textiles and clothing increased by 33.4%, including 32.6% for textiles and 34.1% for garments, both of which exceeded the average value of national trade in goods.

The growth of large categories of commodities is driven by both quantity and price. The expansion of foreign demand has led to an increase in the cumulative export volume of all kinds of commodities, with an increase of 14% to 21%. Over the years, the export prices of major commodities have remained stable. This year, due to the epidemic situation, the upstream supply is not smooth. At the same time, the prices of domestic procurement and imported raw materials remain high due to the loose liquidity of the US dollar and the overall price increase of international bulk commodities, which are further transmitted to the downstream, resulting in a rare price increase in the whole industry chain. In terms of domestic procurement, the purchase price index of textile raw materials increased month by month from negative to positive at the beginning of the year, with a cumulative increase of 5% in the whole year. In terms of import, the price of cotton, the main raw material, continued to run at a high level. The cumulative unit price of imported cotton increased by 16.4%, and the price of chemical fiber increased by 6.5%. The export prices of yarn, fabric and knitwear were increased by 22.4%, 11.5% and 11.2% respectively. The price increase of downstream end products was lower, which showed that garment production and export enterprises were bearing more cost burden, and their profits were squeezed, and the production and operation pressure was the most prominent.

Order backflow is difficult to sustain

In 2020, with the support of China's strong industrial chain and supply chain, imports of major developed countries from China soared. In that year, the share of Chinese products in the European Union, the United States and Japan all rose sharply, temporarily suspending the situation of year-on-year decline before the epidemic. In 2021, under the normalization of the epidemic situation, the procurement mode of developed countries will return to "China + Vietnam + other low-cost countries in Asia". Compared with last year, the share of ASEAN and other places increased, especially the share of Bangladesh in the clothing import of the United States and Japan reached a new high. The share of Chinese products in that year was lower than that of last year, but the market share in EU and Japan was still higher than that in 2019 before the epidemic. According to the statistics of Eurostat, China's textile and garment market share in the EU market will be 33.7% in 2021. According to the statistics of Japan's Ministry of finance, the share of the Japanese market in 2021 is 56.8%, which is 8.7% and 1.9% lower than that in 2020, but both are slightly higher than that in 2019. According to the statistics of the U.S. Department of Commerce, in 2021, our products accounted for 30.4% of the U.S. market, down 8.3% and 2.3% respectively compared with the same period in 2020 and 2019. With the acceleration of the resumption of work and production in Southeast Asia and other places, orders are once again "re outflow" from China, and the market share of Chinese products in developed countries will continue to show a slow downward trend.

Leading role of eastern provinces

In 2021, the top five provinces (autonomous regions and cities) ranking top in textile and clothing export volume are Zhejiang, Jiangsu, Guangdong, Shandong and Fujian. The proportion of total exports in China rises from 73.7% in 2020 to 75.8%, close to the level before the epidemic. The eastern provinces are still the most important force to promote export growth. In terms of geographical regions, the eastern region has achieved an overall growth of 9.1%, driving the overall export growth by 7.8 percentage points, the western region by 29%, and only the central region by 2.7%.

Of the 31 provinces (autonomous regions and municipalities) in China, 21 have achieved growth, accounting for more than 2 / 3, and 26 provinces (autonomous regions and municipalities) have achieved average growth in two years, accounting for more than 80%. Although some regions, such as Hubei and Beijing, suffered a rapid year-on-year decline due to the rise of the base last year, the export scale is still higher than the level before the epidemic, and the average growth rate of the two regions is still 12% and 8.4% respectively.

Steady growth of imports as a whole

Driven by the recovery of production and export, the expansion of domestic demand and the appreciation of RMB, the import of textiles and clothing has been showing a steady growth trend throughout the year, with a growth rate of more than 10% in each month and a cumulative growth of 20.5% in the whole year.

The export expansion of finished garments led to a 29% increase in the import of intermediate textile goods yarn and fabrics. Meanwhile, due to the control of the epidemic situation, domestic consumers were restricted from leaving the country. The consumption demand for foreign medium and high-grade clothing and apparel turned to import and purchase. The total import of knitwear clothing increased by 29.3% in the whole year, and the growth rate of wool leather clothing and clothing accessories was as high as 60% and 43%. The proportion of clothing imports in total imports rose from 40% last year to 43%.

Import growth is also driven by quantity expansion and price increase. The import volume of yarn and knitwear clothing increased by 10.5% and 4.6% respectively, while the import volume of fabrics remained unchanged. The average import prices of the three categories of products increased by 22.5%, 23.5% and 16.7%, respectively. It can be seen that the price pulling effect is more obvious.

Cotton import presents quantity price deviation

In 2021, the cumulative import of cotton was 2.147 million tons, down 0.6%, and the average import price was $1.92/kg, up 16.4%. From January to October, cotton imports showed a decline in volume and an increase in price, with a decrease in volume and a decrease in price at the end of the year. The high price of cotton is the main reason for the decline of import volume. The production enterprises reduce the import of cotton and use imported cotton yarn instead, which drives the annual import volume of cotton yarn to increase by 11%. From the perspective of import market structure, the United States and Brazil are the most important cotton import source countries in China, accounting for 68.6% of the total import volume. After being overtaken by India last year, Australia's share has further declined, and its import volume has fallen to the sixth place, lower than that of the two countries.

According to the statistics of China Cotton Association, the total cotton production in 2021-2022 will be 5.774 million tons, a year-on-year decrease of 2.5%; The estimated import volume is about 2.75 million tons; The consumption was 8.34 million tons, a year-on-year decrease of 1.02%. At the end of the year, the orders of textile enterprises were less. Due to the high inventory of finished products in some mills, the production of yarn and cloth decreased by reducing production; Due to the high price of new cotton, insufficient acceptance of textile enterprises, more cautious procurement of raw materials, industrial inventory slightly decreased compared with last month.

Data source: Based on the data of China Customs