In The Face Of Shrinking Demand, The Adverse Impact Of Textile And Clothing Products Consumption Will Be More Obvious

Since the beginning of this year, complex factors such as repeated outbreaks, long-term geopolitical conflicts, and tightening international financial environment have continued to impact the global economic recovery process. The overall high inflation in the third quarter and the abnormal high temperature and drought weather in the northern hemisphere have intensified the contradiction between supply and demand, and the slowdown of economic growth is more obvious. In August, J.P. Morgan's Global Manufacturing Purchasing Managers Index (PMI) was 50.3, a 26 month low, which was only slightly higher than the boom and bust line. Among them, the new order index was 48.2. The market demand continued to be depressed, and the global economic recovery momentum weakened. The OECD consumer confidence index was 96.2 in July, which has been in the contraction range for 12 consecutive months, and has been slowing down month by month since this year. In the third quarter, the world trade in goods barometer index rose to 100 benchmark level, but it was 10 percentage points lower than the same period of last year. Global commodity prices fell slightly from the high level in the first quarter. However, the prices of IMF's primary products and energy increased by 38.4% and 90.1% respectively year-on-year in July. Inflation pressure has not eased, and CPI of nearly 40% of OECD member countries has increased by more than 10%.

In the face of the three expected internal pressures of demand contraction, supply shock and weakening expectations, as well as the domestic epidemic situation and the conflict between Russia and Ukraine, China's GDP grew by 2.5% in the first half of the year, initially forming the momentum of economic bottoming up. Since July, China's economy has overcome the impact of the epidemic, flood and high-temperature weather fluctuations, and the economy has continued to recover, but the recovery foundation still needs to be consolidated. Statistics show that from January to July, the total retail sales of consumer goods decreased by 0.2% year-on-year, the total export volume (in US dollar) increased by 14.6% year-on-year, and the industrial added value of Enterprises above designated size increased by 3.5% year-on-year, and the growth rate increased by 0.5%, 0.6% and 0.1% respectively compared with the first half of the year; In the same period, the total profit decreased by 1.1% year-on-year, and the growth rate decreased by 2.1% compared with the first half of the year. Affected by the factors such as frequent scattered epidemic, continuous high temperature and rainy weather, power restriction and power saving in Sichuan Chongqing and the middle and lower reaches of the Yangtze River, China's manufacturing PMI continued the weak recovery trend since July in August. Although it rose 0.4 percentage points to 49.4% compared with the previous month, it was still in the contraction range.

Since the third quarter, the textile industry's off-season market is obvious, production orders are still insufficient, and the start-up rate remains at a low level. The prices of finished products experienced a rapid downward trend from mid June to mid July, and then fluctuated at a low level. Enterprises generally de stocked at a lower price to alleviate the pressure on capital, and the pressure on profits continued to increase. Under this market situation, the growth rate of industry production and benefit index slowed down obviously, and the profit decline continued to expand. Recently, power rationing measures have been lifted one after another. In addition, medium and thick fabrics in autumn and winter are just beginning to show up in the near sales season. The start-up rate of clothing low count gauze enterprises has risen slightly. The shipment of some upstream products has been accelerated compared with the previous period, and the finished product inventory has slightly decreased. However, the off-season market with low demand and downward price has not yet come to an end, and enterprises have generally lowered their expectations for peak season.

Looking forward to the fourth quarter, the external environment will become more severe and complex. The global liquidity contraction will continue to restrain the final demand. The negative impact of inflation and high energy prices in some regions on the consumption of textile and clothing products will be more obvious, and the export market will face volatility risk. The domestic sales of the textile industry will recover in the autumn and winter consumption season. The recovery of domestic demand will be the key to the bottom and recovery of the industry operation, and the domestic market will become the backbone to stabilize the development of the textile industry.