Industry Analysis: Analysis Of Economic Operation Of Printing And Dyeing Industry From January To December 2023

In 2023, the growth momentum of the world economy will be insufficient and the recovery will be slow. Major developed economies will implement tight monetary policies under the pressure of high inflation, resulting in a decline in international market demand. Domestic economic development will also face the periodic test of insufficient aggregate demand. In the face of the complex and severe development environment at home and abroad, China has increased macro-control efforts, focused on expanding domestic demand, optimizing the structure, improving confidence and preventing risks, and promoted the recovery of the national economy. Under the support of the policy of stabilizing growth and promoting consumption, driven by the continuous recovery of the domestic market of textiles and clothing and the short-term recovery of international market demand at the end of the year, the production situation of China's printing and dyeing industry has gradually improved. From January to December, the output of printing and dyeing enterprises above designated size achieved a small increase, which was faster than the first three quarters; The export volume of major products has maintained a steady growth, and the decline of export amount has narrowed; The growth rate of operating income and total profit has changed from negative to positive, the sales profit rate has steadily improved, the business efficiency of enterprises has been continuously improved, and the economic operation of the printing and dyeing industry has continued to recover.

　　 Terminal consumption continues to recover Industry production recovered

According to the data of the National Bureau of Statistics, from January to December 2023, the output of printing and dyeing fabrics of enterprises above designated size in the printing and dyeing industry will be 55.882 billion meters, with a year-on-year growth of 1.30%. Since April, the growth rate has changed from negative to positive, maintaining a fluctuation of 1%, and maintaining an overall growth trend. Since the second half of the year, the production of printing and dyeing industry has gradually recovered, and the output of printing and dyeing fabrics has increased month by month. In November, the output of printing and dyeing fabrics of enterprises above designated size returned to more than 5 billion meters. In December, the output of printing and dyeing fabrics reached 5.595 billion meters, with a month on month increase of 9.48%, the highest monthly output since April. With the steady growth of the country to promote consumption policy continued to work effectively, as well as the National Day holiday, the "Double 11" shopping festival, Christmas promotion stocking and other holiday consumption, the textile and clothing terminal demand continued to pick up, and the printing and dyeing industry production recovered. The data shows that from January to December, the retail sales of clothing, shoes, hats and knitwear of units above the designated size increased by 12.9% year on year, 2.3 percentage points higher than that of the first three quarters; In December, the year-on-year growth rate was 26.0%, and the growth rate remained above 20% for two consecutive months. In the online retail sales of physical goods, from January to December, clothing goods increased by 10.8% year on year, 1.2 percentage points higher than that in the first three quarters, and domestic textile and clothing consumption showed a trend of accelerating recovery.

Production and growth of printing and dyeing fabrics of printing and dyeing enterprises above designated size from January to December 2023

Slow recovery of operation quality Continuous improvement of operating efficiency

According to the data of the National Bureau of Statistics, from January to December, the proportion of three fees for printing and dyeing enterprises above designated size was 6.95%, up 0.19 percentage points year on year, of which the financial expenses increased 13.25% year on year; The turnover rate of finished products was 13.83 times/year, down 11.84% year on year, 1.14 percentage points higher than that in the first three quarters; The turnover rate of accounts receivable is 8.01 times/year, up 0.26% year on year, and the growth rate has changed from negative to positive compared with the previous three quarters; The turnover rate of total assets was 0.97 times/year, down 0.24% year on year, 1.85 percentage points lower than that in the first three quarters. At present, the main operating quality indicators of the printing and dyeing industry are still at a low level, among which the turnover rate of finished products has declined significantly, the turnover rate of total assets has not yet reversed the negative growth trend, and the recovery process of the operating efficiency of printing and dyeing enterprises is relatively slow.

From January to December, the operating revenue of printing and dyeing enterprises above designated size was 298.615 billion yuan, up 1.44% year on year, 2.34 percentage points higher than that of the first three quarters; The total profit was 13.915 billion yuan, up 9.26% year on year, 21.49 percentage points higher than that in the first three quarters. Cost profit rate was 5.03%, up 0.38 percentage points year on year; The sales profit rate was 4.66%, up 0.33 percentage points year on year. The number of loss making households of 1781 printing and dyeing enterprises above designated size was 548, with a loss rate of 30.77%, 4.69 percentage points lower than that of the first three quarters; The total loss of loss making enterprises was 3.249 billion yuan, down 9.71% year on year.

In 2023, due to insufficient market demand, intensified market competition and other factors, the operating efficiency of printing and dyeing enterprises will be significantly under pressure. However, as the domestic demand market gradually warms up, the international market will actively expand, and the efficiency level of the printing and dyeing industry will steadily improve. In the first 10 months, the year-on-year decline in operating income and total profit of printing and dyeing enterprises above designated size gradually narrowed. The cumulative growth rate in November turned from negative to positive, and the cumulative growth rate in December further improved. The profit rate of sales increased month by month, the industry's loss area continued to narrow, the loss situation of loss making enterprises improved significantly, and the foundation for the industry to recover was further consolidated.

Growth of operating income and total profit of printing and dyeing enterprises above designated size from January to December 2023

Changes in sales profit rate of printing and dyeing enterprises above designated size from January to December 2023

　 　 Export scale gradually stabilized Differentiation of export market performance

In 2023, influenced by factors such as shrinking international market demand and rising international trade risks, the export of China's printing and dyeing industry will start under pressure, and the export growth rate will remain basically stable from the second quarter. The export of major products will show a trend of rising in volume and falling in price. Overseas demand will improve in the fourth quarter, driving the decline of export amount to continue to narrow. According to Chinese customs data, from January to December, the export volume of China's eight major categories of printing and dyeing products was 31.186 billion meters, up 4.91% year on year, a slight increase of 0.09 percentage points over the first three quarters; The export value was 30.125 billion US dollars, down 3.89% year on year, 1.03 percentage points lower than that in the first three quarters; The average export unit price was 0.97 US dollars/meter, down 8.39% year on year, and the decline rate was 0.90 percentage points lower than that in the first three quarters.

Indirect export of printing and dyeing products is still under pressure, but the short-term pressure has eased. From January to December, China's clothing and clothing accessories exports totaled US $159.14 billion, down 7.8% year on year, 1.0 percentage point lower than the first three quarters; The export of home textile products was 45.978 billion US dollars, down 2.29% year on year, 0.93 percentage points lower than that in the first three quarters.

Export growth of eight categories of printing and dyeing products in China from January to December 2023

From the perspective of major export markets, from January to December, China's eight major categories of printing and dyeing products exported 7.052 billion meters to ASEAN, a year-on-year increase of 2.08%, accounting for 22.61% of the total exports; Exports to RCEP member countries with ASEAN as an important component reached 7.571 billion meters, up 1.33% year on year. From January to December, the growth rate of the export volume of China's eight major categories of printing and dyeing products to ASEAN and RCEP member countries increased by 1.11 and 0.98 percentage points, respectively, compared with the first three quarters, but it was still 2.83 and 3.58 percentage points lower than the growth rate of the total export volume, mainly because the export to the Philippines, Thailand, Malaysia, South Korea and other major export countries declined to varying degrees, and to Vietnam The growth rate of Myanmar's exports is lower than that of its total exports.

From the perspective of major export countries, the export performance of China's eight major categories of printing and dyeing products to the top 10 countries in terms of export scale shows differentiation. From January to December, the export volume to the top 10 countries reached 13.338 billion meters, accounting for 42.77% of the total export volume. Among them, the export volume to Bangladesh, Pakistan and the Philippines declined by 6.05%, 16.78% and 12.58% respectively. The export volume to Nigeria, Vietnam and Myanmar grew slightly. The export volume to India, Russia and other emerging markets performed well, with year-on-year growth of 9.47% and 12.54% respectively. The average unit price of exports to the top 10 countries decreased by 9.14% year on year, 0.75 percentage points higher than the overall level. Only the average unit price of exports to Vietnam increased by 0.12%, while the average unit price of exports to Nigeria, Indonesia, India, Myanmar and Pakistan decreased by more than 10%. The reasons for the price decline of export products are: First, the supply chain of printing and dyeing products is not smoothly connected due to the domestic epidemic in 2022, and the export price has risen to a higher level in recent years, leading to a higher year-on-year base; Second, in 2023, the international market demand will decrease, the industry competition will become fiercer, the phenomenon of price involution will be more common, and the profit space of enterprises will be squeezed; Third, due to the devaluation of RMB against the US dollar, the price of export products in US dollar fell.

Top 10 countries of China's eight categories of printing and dyeing products for export from January to December 2023

　 　 Looking forward to 2024, the external environment is still complex and severe. The slowdown of global economic growth has become a common consensus. Although the current global inflation problem has been alleviated in stages, there are still many short-term and long-term factors leading to the global economic downturn. The Ukraine crisis, the Palestine Israel conflict, etc. have had a sustained impact on the global geopolitical pattern, and the Red Sea crisis has had a devastating impact on global trade and supply chain; Trade protectionism is still prevalent. The United States and Europe have pursued the so-called "decoupling" and "risk-free" strategies, and the global industrial chain and supply chain will accelerate the adjustment and reshaping. In 2024, the printing and dyeing industry will still face many unstable and uncertain factors in foreign trade, and the industry may still face the challenges of insufficient demand and declining orders in traditional markets such as Europe and the United States. At the same time, we should also see that printing and dyeing enterprises continue to increase their efforts to explore emerging markets. Relying on the in-depth implementation of the export market diversification strategy and the vigorous development of China's cross-border e-commerce, China's printing and dyeing products export will also usher in new development opportunities.

The accumulation of positive factors in China provides strong support for the recovery and development of the industry. In 2023, China's national economy will continue to recover and improve. The annual economic growth will be 5.2%, higher than the global expected growth rate of about 3%, and it will stay ahead of the world's major economies. The basic trend of China's long-term economic growth is an important foundation for the steady development of the printing and dyeing industry. In 2024, with the deepening of the national policy of expanding domestic demand and promoting consumption, residents' consumption capacity and willingness are expected to continue to improve, the potential of a strong domestic demand market will be gradually released, and domestic consumption is expected to shift from recovery after the epidemic to continuous expansion. The foundation for stable growth, quality improvement and benefit increase of the printing and dyeing industry will be further consolidated. It is expected that the main economic indicators of the industry will be further repaired in 2024, and the endogenous power for the stable development of the industry will continue to increase.

(Source: China Printing and Dyeing Industry Association)