August heralds one step closer to the traditional textile peak season “Golden Nine and Silver Ten”, and has also become a “critical moment” for the market.
There has been a good sign in the textile trade market in the recent period, and demand for knitted gauze and knitted clothing has begun to kick off. It is understood that the operation rate of circular knitting machines in Guangdong, Fujian, Zhejiang and other places has rebounded since mid-July. Some knitting companies have received orders for knitting underwear, vests, T-shirts, bottoming shirts, leggings, children’s clothing, towels, socks, gloves, etc. Cotton fabric orders include domestic sales orders, and some are exported to ASEAN and Southeast Asian countries (non-traceable orders). However, high value-added and high-profit orders such as high-end singlets and fine-size poplin are relatively rare, and most orders come from “bulk goods”.
In addition, with the arrival of the Christmas season abroad, Christmas supplies companies in Yiwu have once again ushered in the peak period of rush orders and export shipments. At present, most foreign merchants have chosen online ordering methods such as video communication and live ordering.
But has the market reached a turning point?
Work at night and rest during the day
The production status of dyeing plants is the most intuitive feedback on the textile market
From a full-year perspective, in the first half of 2022, the textile and apparel industry is in a situation of rising costs, declining supply, and sluggish domestic demand. International demand is relatively stable, and exports overall have achieved positive year-on-year growth, which has certain support for the textile and apparel industry. Since April, various factors have gradually improved, but various data are still far from the historical reasonable range. In the second half of the year, the pressure on the cost side will tend to weaken, and the impact of rising costs on the chemical fiber-textile industry chain will weaken. The main factors affecting prices are expected to return to the supply and demand side, among which demand is the key factor. It is expected that with the peak season of textile and apparel consumption, ” With the arrival of the “Golden Nine and Silver Ten”, the demand side’s supporting role in the market will be enhanced.
But standing at the present moment, from the downstream side, the actual terminal business has not changed much. The downstream textile market demand has not yet clearly started. What has changed more is just the mentality and expectations of the downstream.
Judging from the recent performance of the printing and dyeing market, proofing has gradually increased, and some orders have been started. The market is one step closer to exiting the off-season. However, even if this wave of market conditions arrives, it may not last long. The production status of dyeing plants is the most intuitive feedback on the textile market. The current overall printing and dyeing market is still in poor condition. The operating rate of printing and dyeing plants is only 40-50%, and some dyeing plants still only operate at night and rest during the day.
2427 sample surveys:
42.03% of people will reduce clothing consumption in the second half of the year
From an economic perspective, textiles and clothing are typical non-necessities, and residents’ consumption willingness has a significant impact on the demand for textiles, clothing and its upstream products.
Since the beginning of this year, affected by various factors, residents’ work mobility has decreased, the income of some residents has decreased, and concerns about living expenses have increased. Combined with the impact of the “work from home” model, consumption of clothing upgrades has been suppressed to a certain extent. The phenomenon of “potato economy” has emerged in economic development, that is, people are more cautious in spending, mainly for the consumption of basic daily necessities such as “potatoes”, which has had a certain adverse impact on the consumption of non-necessities such as clothing.
Recently, the Shanghai Office of China Textile Federation and Donghua University jointly conducted a sample survey on terminal consumption. The survey content includes personal consumption status, consumption habits, the impact of the epidemic and views on the market outlook over the past year. A total of 2,427 samples were collected in this survey. The surveyed subjects cover all 31 provinces, autonomous regions and municipalities in mainland China.
Judging from the frequency of consumers purchasing clothing, most of the respondents chose once every three months, accounting for 37.33%. In previous years, most people chose to shop once a month. This shows that consumers’ shopping frequency is declining and their spending power is also declining.
Judging from the monthly expenditure on clothing, most people spend less than 1,000 yuan, and this group accounts for 79.15%. Among them, those who spend less than 100 yuan account for 11.78%, and those who spend 100-300 yuan account for 30.00%. 300-1,000 yuan accounted for 37.37%. Compared with previous years, the number of low-spending people is increasing. Judging from the price of the purchased clothing items, most people buy clothing for 100-300 yuan/piece, which accounts for 42.69%, followed by 300-1,000 yuan/piece, which accounts for 34.40%.
Regarding the budget for textile and clothing consumption in the second half of the year, 42.03% of people said that the budget would be reduced, which was an increase of 15.24 percentage points from last year. Among them, the proportion of respondents who believed that the budget would be significantly reduced reached 22.83%, an increase of 11.3 percentage points from last year. Among those surveyed, only 9.77% said the budget would increase, a decrease of 2.96 percentage points from last year.��point. This shows that the subsequent domestic demand for textile and apparel is not optimistic.
Affected by various factors such as the COVID-19 epidemic, consumers’ incomes are lower than expected, so their desire and spending power for clothing have declined. Everyone’s consumption of textiles and clothing has decreased both in frequency and overall expenditure. Moreover, everyone’s optimism about the future economic trend is declining, so the overall spending budget is also declining. This is a major negative factor for the later textile and apparel market. In other words, the domestic demand market for textiles and apparel may decline. Although the epidemic has suppressed everyone’s desire for consumption and retaliatory consumption may occur after the epidemic is over, we should not have high expectations for the volume of this rebound.
For textile companies, the entire sales season was missed this spring due to the epidemic, and a large number of clothing company warehouses were filled with spring clothing inventory. Some of them change some spring clothes into autumn clothes for sale, or simply resell them as they are, which leads to a significant reduction in demand for autumn clothes. Naturally, the order stamina in this area is still insufficient, and the market life may remain bleak.
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