From the outbreak of the epidemic in 2020 to the present, in three years, the world has accelerated changes unprecedented in a century, new trends in economic globalization have emerged, manufacturing globalization has weakened, digital globalization has accelerated, and global industrial chains, value chains and supply chains have The layout has changed. China’s wool textile industry is an important force in promoting the development of wool textiles in the world. It is a major exporter of wool textile products and an important force in promoting social and economic development and common prosperity. It links the three industries of animal husbandry, industry and trade, promotes regional coordination, and ensures people’s livelihood and employment. Create a high quality life. How has China’s wool textile industry developed in the past three years? Has its global status changed? At the 91st International Wool Textile Conference held recently, Liu Jiaqiang, president of the China Wool Textile Industry Association, introduced the development path of China’s wool textile industry in the past three years, allowing colleagues in the international wool textile industry to have a better understanding of Chinese wool textile.
Catering to new trends, the industry maintains stable development
In the past three years, China’s wool textile industry has actively responded to challenges, catered to new consumption trends, continuously built a new development pattern, integrated into the domestic consumption cycle, led the industry’s new concepts of technological, green and intelligent development, and sought common development with the international wool textile industry.
In the past three years, China’s woolen production has tended to stabilize and develop. While ensuring effective prevention and control of the COVID-19 epidemic, the wool textile industry has maintained stability and development in the production situation of manufacturing enterprises through technological transformation, automation and even intelligent upgrading. Between 2020 and 2022 (data as of August), the average growth rate of wool yarn production was 5.3%, a significant jump from the average decline of -4.7% between 2017 and 2019. Among them, the annual output of wool yarn will maintain sustained growth in 2020 and 2021, and it is expected that the output of wool yarn will continue to grow in 2022. In 2021, China’s wool yarn output will be approximately 180,000 tons, a year-on-year increase of 4%. From January to August 2022, wool yarn output will be 100,000 tons, a year-on-year increase of 9%.
Between 2020 and 2022 (data as of August), the average growth rate of wool fabric output was 4.9%, higher than the 1% growth rate from 2017 to 2019. The rapid growth rate in the past three years is mainly due to the rapid growth in wool fabric production since 2022. From January to August 2022, the output of wool fabrics was approximately 300 million meters, a year-on-year increase of 42%, and the output level has exceeded the full-year output in 2021.
The number of wool textile enterprises and the scale of the industry in China have not shrunk significantly. The scale and capacity development of China’s wool textile industry are closely related to the world’s wool textile industry. Due to the tightening of international wool supply and the declining share of wool and special animal fiber processing in total textile fiber processing, the number of wool textile companies above designated size has been experiencing negative growth since 2013, and this trend has continued until the COVID-19 epidemic. . From 2013 to 2021, the average decline in the number of wool textile enterprises above designated size was 4.3%. Since 2022, with the recovery of the international wool textile industry situation and the wool textile product consumer market situation, the number of wool textile companies has increased. As of August 2022, the number of wool textile companies above the designated size totals 911, a year-on-year increase of 6.8%.
China’s wool textile industry has many outstanding leading companies, which play an obvious leading role in the industry. There are currently 6 listed companies in the wool textile industry. Judging from the semi-annual reports released by the 6 wool textile companies in August 2022, the operating income growth rate of the industry leaders is close to or exceeding 10%, and the profit margin level is around 5% to 20%. It is obvious that Higher than the industry average. As the cooperation between industry and financial markets deepens, the capital market will learn more about the wool textile industry, and more wool textile companies are expected to achieve more beneficial development through the integration of industry and finance.
The wool textile industry actively integrates into the domestic consumer market cycle and helps build a new dual-cycle development pattern. After the COVID-19 epidemic began, international freight was blocked and the international consumption situation was sluggish for a long period of time. The woolen textile industry, which is highly dependent on foreign countries, actively responded by exploring the domestic market and connecting with domestic brands, retail, and downstream industry chains, aiming at The domestic market’s product preferences, production cycles, and distribution channels will be adjusted and transformed. As of 2021, the overall domestic sales proportion of wool textiles exceeds 60%, an increase of 6 percentage points from 2020. The domestic consumer market still contributes more to the recovery of the industry than the international market. Among them, the proportion of domestic sales of woolen products with wool as the main raw material has increased for two consecutive years. The export market for products with cashmere as the main raw material is even stronger.
Exports are still an important support for the wool spinning industry, which mainly focuses on wool products. From 2017 to 2019 before the epidemic, the total export volume of wool raw materials and products showed a year-by-year decline, with an average annual decline of 7.3%. In 2020, due to the impact of the epidemic on global consumption and freight, the total export volume of wool raw materials and products fell further, down 34% year-on-year.
Although other wool processing regions have geographical, tariff and other advantages, and the global wool consumption situation is still unclear, China’s wool textile industry still insists on grasping the global consumer market of wool products. In 2021, the export volume of wool raw materials and products has accumulated 3.8 billion US dollars, although there is still a certain gap from the higher level, it has rebounded by 23% year-on-year. Since 2022, the woolen textile industry has followed the pulse of the recovery of the global consumer market and quickly occupied the major woolen consumer markets. According to relevant import data from the United States, the European Union, and Japan, the performance of Chinese woolen products in these markets is basically stable. From January to September, Japan imported woolen products totaling 120.4 billion yen, equivalent to approximately US$800 million, a year-on-year increase of 21.5%.The speed increased by 4.6 percentage points compared with the first half of the year. From January to August, the United States imported 2.7 billion U.S. dollars of woolen products, a year-on-year increase of 46%; from January to July, the EU imported 2.4 billion euros of woolen products from outside the region, a year-on-year increase of 44.8%, both maintaining rapid growth. In the European, American and Japanese markets, wool woven garments have shown rapid growth, with import growth rates reaching 36%, 68% and 23% respectively. The market demand for woven products has recovered significantly.
Chinese wool textile products are consolidating their importance to the global wool textile consumer market. Since 2022, the wool textile industry has closely followed the global consumer market situation and its market share in major markets has further increased. According to the latest data, China’s wool textile products accounted for 35%, 29% and 40% of the import value of woolen products outside the European Union from January to July, the import value of the United States from January to August and the import value of Japan from January to September, respectively, compared with the first half of the year. Increases of 2 percentage points, 8 percentage points and 2 percentage points.
Forge ahead with the global wool textile industry on a new journey
At present, factors such as the COVID-19 epidemic, geoeconomic and political situations, rising resource costs, and rising inflation have all become risks to economic, social, and industry development. Only by working together, taking advantage of the situation, and following the trend can the woolen textile industry win the initiative.
First, jointly promote the positive development of the global wool textile consumption situation.
The domestic demand market will be the focus of the wool textile industry’s mid- to long-term development momentum. The proportion of domestic consumption in woolen products continues to increase, which requires the industry to actively explore the demand space for woolen products in various products and consumer markets at all levels. The rise of domestic brands and national fashion culture has brought opportunities for the development of domestic demand for wool textiles.
In 2022, the major wool textile consumer markets will generally show a positive trend. From January to July, the United States imported woolen products totaling US$21.6, a year-on-year increase of 51%; during the same period, Japan imported woolen products totaling 66.5 billion yen (approximately US$460 million), a year-on-year increase of 20.4%. From January to April, the total trade volume of EU wool textile products was 6.4 billion euros, of which imports were 3 billion euros (approximately US$2.97 billion), with a year-on-year growth rate of 33%. Seize the opportunity of the potential development of the international woolen and knitted product consumer market, upgrade and adjust the product structure for international consumption, improve the green and sustainable manufacturing level of the woolen industry and woolen products, and meet the growing demand for sustainable products.
Second, the international wool textile industry chain is closely connected and has complementary advantages.
The structure and layout of the wool textile industry in China and the world are facing new challenges. In recent years, the international wool textile industry has developed a new geographical layout. Many old wool spinning countries have begun to invest in setting up wool spinning primary processing and wool spinning factories in Southeast Asia and other places. The new wool spinning processing clusters are competitors in the wool spinning processing supply chain. It is also an important opportunity for the close connection of industrial chains, complementary advantages and reallocation of resources.
Third, the upgrading and transformation of the industry itself will be an important core for the development of the international wool textile industry.
The recovery of various links in the industrial chain is uneven, the price transmission mechanism is not smooth, and wool textile processing and manufacturing are facing greater cost pressure. The differentiation of enterprise development has become more obvious. Only enterprises that can seize the changing trends of the times, integrate new development models, continuously upgrade and transform themselves can seize opportunities and achieve development. From a long-term perspective, as improving consumer products, woolen products cater to consumption upgrades and meet people’s needs for a better life, and the industry will surely better integrate into the dual-cycle development pattern.
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