The Profit Of China'S Cotton Textile Industry In The First Ten Months Fell Sharply, Dragging Down The Profit Margin

　　 1、 Macroeconomic operation - three recoveries, two stabilities and one boost

　　 After the meeting of the Political Bureau of the Central Committee held on September 26, the relevant departments of the state stepped up their efforts to launch a package of incremental policies. The momentum of economic recovery increased, the main indicators rebounded significantly, and market confidence improved. At the press conference held by the National Bureau of Statistics Office, the spokesman of the National Bureau of Statistics summarized the domestic economic operation in October as "three recoveries, two stabilities and one boost". The "three recoveries" refer to the obvious recovery of market sales, service industry and import and export. The "two stabilities" refer to the steady growth of industry and investment, and the stability of employment and prices. "One boost" means that market confidence has been boosted.

　　 In October, the added value of industries above designated size increased by 5.3% year on year and 0.41% month on month. From January to October, the added value of industries above designated size increased 5.8% year on year. The cumulative year-on-year growth of the textile industry in October and January October was 3.8% and 5.1% respectively.

　　 In October, the national consumer price rose 0.3% year on year and fell 0.3% month on month, of which clothing rose 1.4% year on year and 0.1% month on month. From January to October, on average, the consumer price of the whole country rose by 0.3% year on year, of which the clothing rose by 1.7% year on year.

　　 In October, the ex factory prices of industrial producers across the country fell 2.9% year on year and 0.1% month on month. On average, the ex factory price of industrial producers dropped by 2.1% year on year from January to October, of which the textile industry dropped by 1.8% year on year in October, 0.2% month on month, and 1% year on year from January to October.

　　 In October, the total retail sales of consumer goods reached 4539.6 billion yuan, up 4.8% year on year. From January to October, the total retail sales of consumer goods reached 39896 billion yuan, up 3.5% year on year. Among them, clothing, shoes and hats, knitwear and textiles above designated size increased by 8% year on year in October and 1.1% year on year from January to October.

　　 From January to October, the national fixed asset investment (excluding farmers) was 42322.2 billion yuan, up 3.4% year on year, including 15.2% growth in the textile industry.

　　 2、 Cotton textile industry - profit drops sharply, dragging down profit margin

　　 According to the data of the National Bureau of Statistics, from January to October, the cotton textile business income was flat on a year-on-year basis, but the total profit declined significantly, reaching 23.1%, 15.6 percentage points more than the cumulative decline from January to September. Due to the failure to increase the revenue, the sharp decline in profits has dragged down the industry's operating revenue profit margin, which is only 1.7%, the lowest point since the cumulative revenue profit margin of 1.6% from January to May. The trend of continuous repair of profit margin in the past six months has been broken, among which the economic operation of cotton yarn is more difficult. From January to October, the cumulative revenue and profits both fell, and the total profit fell by 39.8%, The profit margin of revenue was only 1.07%. The cotton textile industry's "golden nine and silver ten" peak season cycle almost failed, and the industry continued to increase pressure.

　　 According to the data of the National Bureau of Statistics, at the end of October, the inventory turnover days of cotton textile products were 38.8 days, and the product inventory pressure continued. The average payback period of accounts receivable was 45.3 days, 0.4 days more than that at the end of September, further tightening cash flow. Data from January to October show that compared with industrial enterprises above designated size, manufacturing industry and textile industry, major indicators of cotton textile industry, such as operating income, total profit, revenue profit rate, cost per 100 yuan of operating income, asset liability ratio, and days of finished goods inventory turnover, are lagging behind to varying degrees, Only the operating income and average payback period of accounts receivable per 100 yuan of assets are slightly better.

　　 （1） Operating revenue - cotton spinning yarn decreased and contracted, and cotton weaving growth slowed down

　　 According to the data of the National Bureau of Statistics, from January to October, the operating revenue of cotton spinning above designated size decreased by 2.78%, 0.36 percentage points less than the cumulative decline from January to September, and the operating revenue of cotton weaving above designated size increased by 5.28%, 0.64 percentage points less than the cumulative growth from January to September. The cumulative revenue of cotton spinning and cotton weaving continued to differentiate year-on-year.

　　 （2） Profit - cotton yarn decreases significantly, and cotton weaving turns from positive to negative

　　 According to the data of the National Bureau of Statistics, from January to October, the total profit of cotton spinning above designated size dropped by 39.82%, 22.2 percentage points more than that from January to September. The total profit of cotton weaving above designated size turned from positive to negative, from 3.57% to 5.33%, and the profit of cotton spinning was significantly reduced.

　　 According to the data of the National Bureau of Statistics, from January to October, the profit margin of cotton spinning revenue above designated size was 1.07%. It was the lowest point since January to April, and the profit margin of operating revenue of cotton weaving above designated size was 2.81%, maintaining the trend of continuous repair within the year and reaching the highest point within the year, 1.74 percentage points higher than that of cotton spinning. The profit margin of cotton spinning and cotton weaving differentiated to the highest value since February.

　　 （3） Loss area - cotton spinning and weaving are slightly reduced

　　 According to the data of the National Bureau of Statistics, from January to October, the loss of cotton yarn above designated size was 27.37%, 0.27 percentage points lower than that from January to September, and the loss of cotton weaving above designated size was 21.15%, 0.73 percentage points lower than that from January to September.

　　 （4） Export - continued recovery to promote industry stability

　　 According to the statistics of the General Administration of Customs, from January to October, China's textile and clothing exports reached 247.89 billion US dollars, up 1.5% year on year, 1 percentage point faster than the first three quarters. Among them, textile exports reached US $116.69 billion, up 4.1% year on year; Garment exports reached US $131.2 billion, down 0.7% year on year. In RMB terms, China's textile and clothing exports from January to October amounted to 1.76 trillion yuan, up 3% year on year. Among them, the textile export was 829.52 billion yuan, up 5.8% year on year; Clothing exports reached 932.75 billion yuan, up 0.7% year on year.

　　 According to the data of the National Bureau of Statistics, from January to October, the export delivery value of China's cotton spinning yarn and cotton weaving increased by 1.39% and 1.23% respectively year on year, 3.62 and 0.46 percentage points more than that from January to September, respectively, of which cotton spinning yarn turned from negative to positive, showing a positive signal. Although the cotton textile export delivery value data is not as fast as the textile export growth rate announced by the customs, the continuous recovery trend is still an important support for the stable operation of the industry.

　　 （5） Product output - cumulative yarn decrease and fabric increase on a year-on-year basis, and chemical fiber substitution trend is obvious

　　 According to the data of the National Bureau of Statistics, from January to October, the output of yarn above designated size was 18.544 million tons, down 0.86% year on year, of which cotton yarn and cotton blended yarn were down 3.61% and 4.14% respectively, and chemical fiber yarn was up 6.25% year on year. The trend of chemical fiber replacing cotton was obvious, and the output of fabric above designated size was 26.03 billion meters, up 2.03% year on year.

　　 （6） "Key enterprises" - shrinking revenue, deepening profit decline and flat profit margin

　　 According to the data of key enterprises tracked by the China Cotton Textile Industry Association (hereinafter referred to as "key enterprises"), from January to October, the operating revenue fell 1.34% year on year, the decline was 0.7 percentage points less than that from January to September, the total profit fell 19.13% year on year, the decline was 2.4 percentage points more than that from January to September, the cumulative loss area was 34.39%, 0.66 percentage points more than that from January to September, The cumulative operating income profit margin was 3.53%, the same as that from January to September.

　　 3、 Operation prospect

　　 To sum up, under the influence of various policies and measures in October, the national economy has made steady progress, major macroeconomic indicators have rebounded significantly, and market confidence has been boosted. However, it should also be noted that the international environment is complex and severe, domestic demand is weak, and some enterprises are difficult to operate. Specifically, in the cotton textile industry, the "golden nine and silver ten" peak season basically failed, the industry's accumulated revenue stagnated, the total profit fell sharply, dragging the profit margin to the lowest level since half a year, and the industry's economic operation is still in the bottom. As December approaches, the market has expectations for the upcoming Central Economic Work Conference. It is hoped that the conference will continue to have a positive attitude towards the setting of macro policies next year and continue to introduce new policies to boost market confidence.

(Source: China Cotton Association)