Flame retardant fabric_Flame retardant fabric_Cotton flame retardant fabric_Flame retardant fabric information platform Flame-retardant Fabric News Foreign trade orders are abnormal, and the “cold” is approaching small and medium-sized enterprises. Where will the market outlook go?

Foreign trade orders are abnormal, and the “cold” is approaching small and medium-sized enterprises. Where will the market outlook go?

Textile and apparel export growth hit the brakes in August, decreasing by 14.7 percentage points. The overseas consumer market is weak and orders are being diverted from Southeast …

Textile and apparel export growth hit the brakes in August, decreasing by 14.7 percentage points. The overseas consumer market is weak and orders are being diverted from Southeast Asia. Foreign trade companies have already felt the abnormality in orders.

It is reported that multiple factors such as shrinking international market demand and falling prices of chemical fiber and cotton textile raw materials affected the growth rate of exports in August. The traditional peak season of “Golden September and Silver October” is approaching, but many industry insiders have expressed a cautious attitude towards the future market. Large enterprises are having an easier time with more stable customers and production capacity in Southeast Asia. However, small and medium-sized enterprises have clearly felt the “cold”. “Many small factories have not received orders this year. We expect to enter the gap period two or three months in advance and let workers go home for the holidays early.” A clothing company owner said.

Textile and clothing export growth slows down

According to customs data, my country’s textile and apparel exports in August were US$30.976 billion, with a year-on-year growth rate slowing down 14.7 percentage points from 17.58% in July to 2.88%. Among them, the year-on-year growth rate of textile exports dropped from 16.2% in July to – 0.23%, and the year-on-year growth rate of clothing exports slowed to 5.10% from 18.55% in July.

Liu Jie, cotton and cotton yarn futures analyst at Zhuochuang Information, told reporters from the Associated Press that inflation in major foreign economies is high, the pace of interest rate hikes by the central banks of the United States and Europe is accelerating, and international market demand has fallen; at the same time, after the prices of chemical fiber and cotton textile raw materials dropped, The pricing of textiles and clothing has dropped, resulting in lower exports. The above two reasons dragged down the growth rate of China’s textile and apparel exports in August.

An owner of a textile foreign trade company in Haining, Zhejiang, mentioned, “The company’s (export orders) from January to August increased by 38% compared with the same period last year, because the performance in the same period last year was really poor. This year we were lucky and developed a new customer. They The factory we originally cooperated with made a serious error, so the order was transferred to us. With this increase, our order volume this year can be the same as last year.”

Industry insiders mentioned that the transfer of textile orders to Southeast Asia this year has also had an adverse impact on exports. “What Southeast Asia has taken away are domestic factories that make more basic models. The relatively high-end ones are still in China. But in fact, for the industry, basic models are the most important. Although the profit is thin, the volume is large and the proportion is large. , which can support the factory’s production and ensure profits.”

A textile industry analyst said that two trends are emerging in the industry: first, the dependence on the export of textile and apparel products is higher, and second, the textile and apparel production capacity in Southeast Asia and African markets is growing rapidly, and domestic textile exports may have a risk of decline in the future. .

The base of Southeast Asia’s textile exports is low, and the industrial structure is not very sound. Raw materials such as cotton are dependent on imports. There is still a gap between China and China in terms of production scale, industrial level, and raw material costs, so the impact of order transfer is limited.

The “cold” is approaching small and medium-sized enterprises, but large companies can still “bear it”

A recent questionnaire survey conducted by the China Council for the Promotion of International Trade among more than 500 companies showed that companies are currently facing major difficulties such as slow logistics, high costs, and few orders. 62.5% of companies said that orders are unstable, with many short orders and small orders, and long-term orders. Large orders and small orders. The market downturn and lack of willingness to consume have made it more difficult for textile and apparel foreign trade companies to obtain orders.

On the other hand, the increase in order volume and export volume is not directly related to corporate profits. The boss of the above-mentioned textile foreign trade company told a reporter from the Financial Associated Press that even if the order volume is guaranteed, the company’s profits are still eroded by multiple factors. “Textile orders exported to Japan first face the fluctuation of the Japanese exchange rate, and Japanese stores basically do not increase in price.” Commodity prices, this part of the loss is borne by Japanese traders, Chinese traders, and Chinese factories, so our profits have dropped particularly significantly this year. In addition, the price of raw materials in the domestic market has generally increased, including electricity charges, steam charges, etc. have increased significantly. Awesome. The net profit margin of our products is expected to drop by at least 2-3 percentage points.”

Shenzhou International (2313.HK), the leading OEM in the garment industry, also mentioned in its 2022 semi-annual report that the export growth in the first half of the year included price increases caused by rising raw material prices, and cannot be entirely attributed to the increase in export volume.

The above-mentioned industry insiders further said that companies with capital strength will transfer production capacity to Southeast Asia and effectively control costs through industrial chain layout. However, for many small and medium-sized enterprises, they can only “take orders when there are orders and stop production when there are no orders.” This means that industry elimination is accelerating.

Compared with small and medium-sized enterprises that are struggling to survive, leading enterprises rely on the deployment of production capacity in Southeast Asia and cooperation with medium- and long-term major customers, and current orders are relatively stable. Huali Group (300979.SZ)’s orders from its three major customers in the first half of the year maintained year-on-year growth. The current customer order rhythm has not changed, and production capacity is ramping up smoothly. New production capacity in Indonesia and Vietnam will be released in the first half of 2023; Jiansheng The Group’s (603558.SH) production capacity utilization rate in Vietnam has increased to saturation, which has promoted the increase in seamless business. The current order receiving situation in Q3 and Q4 is relatively optimistic.

“It will take a certain amount of time for inflation in the European and American markets to be transmitted to end consumption,” a person from the securities department of Lutai A (000726.SZ) told a reporter from the Financial Associated Press. “By the end of December or early next year, the market will begin to react. Now we are also Not sure. It will basically not (have a big impact) on orders for the whole year. Our orders in the third quarter were stable month-on-month. By November (fabric) orders were all taken, and the clothing orders for the Christmas season have been completed.��It’s shipped. ”

Judging from the export order cycle, orders for next spring and summer have arrived. A person from the securities department of Jiaxin Silk (002404.SZ) told a reporter from the Financial Associated Press, “The company will enter the peak season from October to the Spring Festival, and then next spring Orders for summer.” He mentioned that the drop in demand in the European and American markets has not affected the company’s export orders. At present, foreign trade orders continue to grow in the first half of the year, and orders are abundant.

Insufficient consumption power makes it difficult for the industry to be optimistic

Data show that the U.S. ISM manufacturing PMI index has accelerated its decline and has reached near the boom-bust line in August, indicating that demand is about to enter a state of contraction. People’s consumption of non-necessities has weakened, putting pressure on domestic textile and clothing exports.

Many industry insiders have expressed caution about the future market. A cotton textile company mentioned to a reporter from the Financial Associated Press, “Although it has entered the peak season of the Golden Nine and Silver Tens, the domestic market has not seen obvious prosperity, and the same is true for foreign consumption.”

Vietnam’s textile exports are also affected by falling demand. According to the Economic and Commercial Office of the Consulate General in Ho Chi Minh City, in the first eight months of this year, Vietnam’s textile and garment industry exports were approximately US$30.2 billion, a year-on-year increase of nearly 20%, averaging US$3.7 billion to US$3.8 billion per month. However, it is expected that the remainder of this year will In the next four months, exports were only US$3.1 billion-3.2 billion per month. Le Tien Truong, chairman of Vietnam Textile and Apparel Group, predicts that the market downturn will continue until 2023.

Shenzhou International also mentioned: “It is expected that from the second half of the year to the first half of next year, the textile and apparel industry may suffer from the impact of reduced capacity utilization due to insufficient demand. Global inflationary pressure will continue, and corporate profits will continue to be under pressure. .”

Judging from the total textile and clothing exports from January to August, the growth rate still maintained double digits, reaching a year-on-year growth rate of 11%; of which textile exports were US$102.27 billion, an increase of 10.2%, and clothing exports were US$118.03 billion, an increase of 11.6% .

Even if the peak season is not busy, it is still a peak season and the increase will be guaranteed. With the arrival of the traditional peak season of “Golden Nine and Silver Ten”, China’s textile and apparel exports are still expected to gradually increase in volume, and the month-on-month growth rate is expected to turn positive. Faced with positive support such as improving demand, falling inventories, and rebounding costs, as well as the depreciation of the RMB, which enhances the international competitiveness of export companies, China’s textile and clothing export situation is expected to improve.

This article is from the Internet, does not represent 【www.pctextile.com】 position, reproduced please specify the source.https://www.pctextile.com/archives/3188

Author: clsrich