In recent months, my country’s domestic home textile orders have recovered from the “cold winter” in the textile and apparel industry in the first half of the year and ushered in a new round of boom.
Data show that the “turnover” of the textile and apparel industry mainly occurred in the second half of this year. Data show that from January to August, the national textile and apparel export volume was US$187.41 billion, a year-on-year increase of 5.6%, and the growth rate was 1.3 percentage points faster than that from January to July. In the month of August, the national textile export volume was US$14.72 billion, a year-on-year increase of 47%; the clothing export volume was US$16.21 billion, a year-on-year increase of 3.2%, achieving positive monthly growth for the first time this year.
The reason for this is that on the one hand, the peak season for foreign trade has arrived; on the other hand, many overseas orders have been rapidly transferred from India and other countries to domestic production recently.
India is the world’s largest cotton producer, the world’s largest jute producer, and the world’s second largest silk producer. Its yarn production capacity accounts for 22% of the world’s. Textile revenue has always been one of the main pillars of the Indian economy and one of India’s largest sources of foreign exchange earnings. The textile industry accounts for about 15% of India’s total export revenue. However, COVID-19 has caused a shutdown in the textile industry. As of October 13, more than 7 million people in India have been diagnosed with COVID-19, ranking second in the world in cumulative confirmed cases.
As the world’s largest cotton-producing country, India’s textile income has always been one of the main pillars of the Indian economy. However, due to the severe domestic epidemic in India, the cumulative number of confirmed cases ranks third in the world. Second, it is difficult for domestic textile companies to complete normal deliveries. According to data, although India’s textile exports have rebounded since bottoming out in May, they have not yet returned to previous levels.
And during the epidemic, the demand for home textiles was relatively strong, which is one of the reasons why my country’s domestic home textile orders have performed extremely well in recent months.
India has always been an important export destination for Haining’s warp knitting products. Haining’s warp knitting products exported to the Indian market accounted for approximately 7.25% of Haining’s warp knitting exports to the Asian market. The main products of Haining’s warp knitting industry exported to the Indian market are warp knitted fabrics for apparel and warp knitted products for industrial use (light box advertising fabrics, tarpaulins (including mesh fabrics)). Among them, warp knitted fabrics for apparel account for approximately the total exports. 30%.
Light box advertising fabrics and tarpaulins (including mesh fabrics) are the focus of purchases by Indian customers, especially warp-knitted biaxial mesh fabrics. Industrial warp knitted products are mainly used for advertising and waterproofing in the rainy season in India. Indian companies purchase mesh fabrics for the processing and production of industrial warp knitted products such as light box advertising fabrics and tarpaulins. Approximately 500 million square meters of mesh fabrics are purchased every year. , accounting for about 2/7 of Haining’s mesh fabric production capacity, and about 60% of the ordinary mesh fabrics in Haining’s market are exported to India.
According to China Customs statistics, the warp knitting industry in Haining City exported a total of 155 million yuan to the Indian market in 2019, a decrease of 13.76% from the 2018 export volume of 179 million yuan.
In the first half of 2020, affected by the Spring Festival holiday and the new coronavirus epidemic, the total export volume of Haining’s warp knitting industry to the Indian market was 41.63 million yuan, which was 41.63 million yuan compared with 2019. The 82.43 million yuan in the same period decreased by 49.49%. In order to withstand the months-long rainy season in India, May and June each year have been the peak period for the export of industrial warp knitted products (for rain protection) such as Haining tarpaulins to India. However, this year’s peak period has not come. Moreover, sales in June dropped by 90.3% compared with the same period in 2019, and monthly transaction volume dropped to a historical low in more than 10 years.
The reason is that the conflict between Chinese and Indian armies in the Galwan Valley on June 15th caused tension between the two countries, which subsequently triggered a boycott of Chinese products by Indian citizens. Seriously affecting the trade enthusiasm of the two countries.
At the same time, the worsening COVID-19 epidemic in India and the various anti-epidemic control measures introduced by the Indian government have restricted the export of Haining warp knitting products to India.
As a category in the Indian textile industry, warp knitting has always played an important role. The technical textiles sector is the focus of India’s warp knitting industry, with a growth rate of 11% in 2019, accounting for about 0.75% of India’s GDP, accounting for approximately 12% of the Indian textile market, and approximately 4% of the global market. %.
The export of low-end industrial warp knitting products such as clothing warp knitting products and light box advertising fabrics has always been the key export product of the Indian warp knitting industry, mainly exported to Southeast Asia, Europe and the United States. As U.S. President Trump fired the first shot in the Sino-U.S. trade war on April 3, 2018, all industrial warp knitting products such as tarpaulins produced by Haining warp knitting companies were included in the tax list, losing their competitive advantage and being forced to withdraw from the US market.
Indian companies have seized this rare opportunity to introduce their warp knitting products into the U.S. market, continue to expand market share, seize market share, and enhance the popularity of Indian warp knitting products in the United States. market influence. In the traditional Southeast Asian market, due to the rising costs of human resources and other costs in the Haining warp knitting industry, low-end warp knitting products have gradually lost their price advantage. They have no capital to compete with Indian companies and are forced to gradually give up the market.
With the development of European and American economies,It is a great benefit for downstream companies to superimpose the transfer of these orders to China. According to their research on some downstream companies, they found that the demand for home textiles in large supermarkets in Europe and the United States is very large, because there was no demand during the epidemic. Replenishment has caused the inventory of these household items in supermarkets to be exhausted, so the intensity of replenishment is very strong.
Since the domestic epidemic in India is still relatively serious, with the cumulative number of confirmed cases ranking second in the world, it is difficult for Indian textile companies to complete normal deliveries, and some orders have also been transferred to my country for production, resulting in Haining. The warp knitting market is gradually improving.
However, everything has two sides. Affected by the epidemic in India, Europe and the United States, more and more buyers want to postpone their accounts, and uncontrollable factors have also increased. .
Warp knitting enterprises must comprehensively sort out the orders and business on hand. For orders that have been delivered, they must speed up the recovery of payment to avoid delays in payment recovery or customers due to the impact of epidemic control. Malicious default on payment.
For orders that are on the way or stranded at the port, we must strengthen monitoring of the flow of goods and maintain close communication with customers to ensure that customers receive the goods as soon as possible, reduce risks and losses, If necessary, you can seek support from a lawyer or CITIC Insurance.
For existing orders with delayed shipments, we must pay more attention to the epidemic areas in India, keep abreast of the Indian government’s control measures, and fully consider possible delays in customer receipts in the future. Develop strategies to deal with issues such as delivery and delayed payments.
If a signed contract needs to be terminated due to force majeure due to the epidemic or the customer is unable to perform, countermeasures should be found as soon as possible and prepared for the worst.
For new orders transferred from the recent epidemic in India, companies should be cautious before signing trade contracts, especially when the epidemic situation in India improves, and orders will return to India again. Risk assessment, and in the contract Make corresponding provisions for the impact of the epidemic, reasonably arrange shipments, and pay attention to controlling cargo rights and shipment rhythm.
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