1 Situation Overview
Orders from large enterprises are gradually recovering, and uncertainty has become a fetter for enterprises to accept orders. important factors.
In the second quarter, the country’s cumulative exports of textile and apparel increased by 19.2%, of which traditional bulk commodities other than epidemic prevention materials, yarn The total exports of the three major categories of products, fabrics and needle-woven garments dropped by 28.5%. In July, the beginning of the third quarter, the rebound in the external demand market led to a rapid narrowing of the decline in commodity exports to 10%. Echoing the data, I learned through corporate surveys that large companies currently generally report that orders other than epidemic prevention supplies have begun to recover or even be saturated, and corporate production and exports are gradually returning to normal. However, due to importers putting forward new requirements for payment terms and payment methods , while the foreign epidemic situation has not yet fully eased, companies are worried about the risk of collection due to the recurrence of the epidemic, so they dare not accept long-term or large orders in the short term, and would rather accept small or short-term orders. It is predicted that if the global epidemic continues to be alleviated before the end of the year, exports will continue to stabilize in the third and fourth quarters, and the overall trend will continue to improve, but the rebound speed and intensity will not be too fast.
Industrial transfer momentum is recovering, and Chinese textile companies need to prepare in advance for the “post-epidemic” era.
During the global epidemic, due to their reliance on China’s anti-epidemic materials and their trust in China’s strong and stable supply capabilities, major markets temporarily stopped moving procurement overseas and shifted their procurement focus to Returning to China, the market share of Chinese products was once high. As the epidemic gradually eases, markets such as the European Union, the United States, and Japan have once again turned their attention to ASEAN, South Asia, and countries and regions with geographical advantages, and the market share of Chinese products has fallen again. Large brands such as Uniqlo have expanded their procurement centers from Shanghai to Vietnam, showing a strong signal of order transfer. Chinese textile companies need to focus on changes in procurement trends, plan in advance, and prepare response strategies.
Political factors have intensified the challenges faced by China’s textile and apparel industry chain, making it imperative to form a regional industrial alliance.
Political intervention in the market is increasingly deepening. Driven by political factors, major developed countries have further accelerated the process of diversifying market procurement. After the outbreak, developed countries such as the United States and the European Union realized the lack of their own industries and gradually attracted ASEAN, India and other places to form and expand their own regional layout of industrial chains to confront China. At the same time, although the upstream and downstream supporting facilities are not complete and the main intermediate products still rely on imports from China, in order to protect their own industries, ASEAN countries have also begun to launch trade remedy investigations against China’s textiles, and the trend is becoming more and more intense. Facing multiple pressures, the Chinese government, intermediary organizations and enterprises need to work together to deal with it. Accelerate free trade agreement negotiations or upgrade negotiations, establish a good open and business environment, and form cooperative partnerships with neighboring countries and “Belt and Road” countries. Establish a regional industrial alliance to form a sound pattern dominated by mutual benefit and collaborative development. While helping neighboring countries to improve their industrial foundation, they will gradually build China into a high value-added industrial center focusing on design and R&D.
2 Trade data
In July, national import and export of goods trade The total value was US$412.93 billion, an increase of 3.4% year-on-year (the same below), of which exports were US$237.63 billion, an increase of 7.2%, and imports were US$175.3 billion, a decrease of 1.4%. The trade surplus for the month was US$62.33 billion. From January to July, the total import and export value was US$2,442.63 billion, down 4.8% year-on-year, of which exports were US$1,336.38 billion, down 4.1%, and imports were US$1,106.25 billion, down 75.7%, achieving a cumulative surplus of US$230.13 billion.
In July, the textile and apparel trade volume was US$33.79 billion, an increase of 13.2%, of which exports were US$31.77 billion, an increase of 15.5%, and imports were US$2.03 billion, a decrease of 13%. The trade surplus that month 29.74 billion US dollars, an increase of 18.1%. From January to July 2020, the textile and apparel trade volume was US$172.08 billion, a year-on-year increase of 3.5%. Among them, exports were US$159.1 billion, an increase of 4.8%; imports were US$12.98 billion, a decrease of 10%, and the cumulative trade surplus was US$146.12 billion, an increase of 6.4%.
3 Trade Characteristics
Textiles and Clothing from January to July 2020 Import and export show the following characteristics:
1 Exports have grown for four consecutive months, and bulk commodities have shown a rebound trend
From April to July, textiles and clothing achieved export growth for four consecutive months. In July, the beginning of the third quarter, exports increased by 15.5% year-on-year and month-on-month by 8% respectively. The growth was mainly driven by epidemic prevention materials. At the same time, traditional bulk goods The export of commodities is also gradually showing a good trend. Although the export volume of the three major categories of yarn, fabrics and clothing still showed negative growth in July, the decline rate was significantly narrower than in the previous period.
2 General trade exports maintained rapid growth, with private enterprises leading the country.
General trade exports have achieved double-digit growth for four consecutive months, with an increase of 20.3% in July and a cumulative increase of 8.9% from January to July. Processing trade continued to decline, with a decline of 24% in July. The decline was slightly slower than in the previous period, with a cumulative decline of 30.8% from January to July.
Private enterprises continue to maintain their leading role. Exports in July and January to July increased by 14.9% and 8.2% respectively, forming a significant positive boost to national exports. The cumulative exports of state-owned enterprises and foreign-funded enterprises fell by 1.4% and 4.5% respectively from January to July, down .�It should be concentrated in February to May, with a gradual rebound in June and July and a return to growth year-on-year.
3 Clothing exports to the main markets have gradually recovered, and the procurement direction in the international market will return to normal as the epidemic situation improves.
In July, consumer demand in the international market picked up slightly. China’s export situation of key commodities and clothing to the three main markets of the EU, the United States, and Japan improved compared with the previous period. The export volume increased month-on-month and year-on-year. The declines narrowed by 2.5, 0.3 and 8.9 percentage points respectively from the previous month. From January to July, China’s clothing exports to the three major markets fell by 12.5%, 27% and 12.5% respectively, with the United States declining the most.
In July, exports of anti-epidemic materials to regions other than the United States fell significantly. Exports to the EU, Japan, South Korea, and ASEAN dropped by 30.5%, 15%, and 50% respectively month-on-month. As the epidemic in the United States has not been effectively alleviated, the demand for anti-epidemic materials has increased instead of falling, with a month-on-month increase of 1%.
As the epidemic eases, the procurement of clothing products in various markets has gradually returned to the track of diversification. Judging from the import data of major markets, the proportion of clothing imports from China to the United States and Japan reached a peak of 60.4% and 74% respectively in May, but then gradually fell back to 34.1% and 52.7% respectively in July. During the same period, ASEAN’s share Share expanded again.
4 Anti-epidemic materials are still the main force driving export growth, and the export situation of traditional bulk commodities has improved slightly.
In July, the world has not yet emerged from the shadow of the epidemic. Although exports of anti-epidemic materials fell slightly from the peak in May and June, they still maintained the characteristics of large scale and high growth. It is still the main force driving export growth. Exports of anti-epidemic materials that month were US$8.91 billion, down 17.4% from the previous month. Cumulative exports amounted to US$47.65 billion, accounting for 30% of total exports.
In July, market demand recovered slightly. In addition to anti-epidemic materials, the export decline of bulk commodities, including yarn, fabrics, and knitted garments, slowed down compared with the previous period. However, Still have not been able to resume growth. The cumulative declines of the three major categories of commodities from January to July were 31.3%, 27.4% and 18.1% respectively.
5 Guangdong’s exports rebounded rapidly, and Beijing and Hubei continued to grow at a high level.
Since the second quarter, Guangdong’s performance has been obviously outstanding. From April to July, exports have continuously achieved rapid growth. The growth rate in July climbed to 60.4%. From January to July, the cumulative growth was 20.5%. It ranks first among the top five exporting provinces and cities. Zhejiang and Jiangsu decreased by 5.4% and 7.6% respectively, while Shandong and Shanghai increased by 6.3% and 15.8% respectively.
The popularity of exports from Beijing and Hubei remains unabated, with growth of 288.2% and 142.8% respectively in July, and cumulative growth from January to July of 267% and 131.5% respectively.
6 The decline in imports continues unabated, indicating that it will still take time for the industry to recover.
In contrast to exports, textile and clothing imports have been declining for four consecutive months and still do not show a recovery trend. In July, the sales dropped by 13%, of which yarn fabrics dropped by 20.2% and needle and woven garments dropped by 11.6%. Cumulative imports from January to July dropped by 10%, of which yarn fabrics dropped by 27% and needle and woven garments dropped by 10%.
There is a certain correlation between current imports and later exports. In particular, the slow recovery in imports of intermediate goods indicates to a certain extent that apparel exports may weaken in the later period and lack growth momentum.
7 Cotton imports rebounded rapidly, with US cotton accounting for more than one-third.
In July, cotton imports continued to rebound rapidly, with 148,000 tons imported that month, an increase of 64% from June, and the year-on-year decline narrowed to 9.2%. The cumulative imports from January to July were 1.047 million tons, a year-on-year decrease of 22%. The United States was the largest import source country, with a total import of 391,000 tons from the United States, an increase of 40.4%. The proportion of U.S. cotton rose to 37%, which reached 37% in July. Two thirds.
The China Cotton Association analyzed that in July, the national economy continued to recover steadily. Although the cotton area decreased, the output increased steadily. The cotton reserves have adapted to market demand and all transactions have been completed. The Xinjiang epidemic has affected Xinjiang cotton exports and domestic spot prices have increased. The textile market is in the off-season, raw material inventories remain low, and the decline in cotton commercial inventories has narrowed. Cotton imports continue to grow, foreign epidemics continue, drought conditions develop in US cotton areas, and conflicts between China and the US escalate again. Affected by a variety of factors, international cotton prices fluctuate frequently. At the end of the month, China’s cotton price index (CCIndex3128B) was 12,319 yuan/ton, an increase of 453 yuan from the end of the previous month; the monthly average price was 12,156 yuan/ton, an increase of 198 yuan month-on-month, and a year-on-year decrease of 1,994 yuan. China’s imported cotton price index FC Index M averaged 69.6 cents/pound in monthly terms, up 1.29 cents from the previous month. At the end of the month, it was 69.62 cents/pound, higher than the 1.87 cents/pound at the end of the previous month. The 1% tariff discount was RMB 12,176/ton, which was lower than the domestic spot price of RMB 143 during the same period. The price difference between domestic and foreign cotton expanded by RMB 145 compared with the end of the previous month.
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