Textile Industry Climbing Slope, Relying on Domestic Demand, Domestic Sales Steady and Good in the Second Half of the Year


Release time:

2021-09-16

Driven by the domestic demand market, superimposed on the return of overseas orders, China's textile industry in the first half of the year gradually improved, revenue grew steadily, profits from negative to positive. Data show that in the first half of 2021, the textile industry's operating income was 1170.75 billion billion yuan, an increase of 18.9 percent over the same period last year; the total profit was 44.6 billion billion yuan, an increase of 2.3 percent over the same period last year.

Driven by the domestic demand market, superimposed on the return of overseas orders, China's textile industry in the first half of the year gradually improved, revenue grew steadily, profits from negative to positive. Data show that in the first half of 2021, the textile industry's operating income was 1170.75 billion billion yuan, an increase of 18.9 percent over the same period last year; the total profit was 44.6 billion billion yuan, an increase of 2.3 percent over the same period last year.

"The growth rate has not yet fully recovered, and the industry still needs to continue its efforts." At the recent video conference on economic operation analysis held by the China Textile Federation in the first half of 2021, Sun Ruizhe, president of the China Textile Industry Federation, summed up the situation of the textile industry in the first half of the year.

Outstanding performance of leading enterprises

Xiao Xiao, a Beijing citizen who originally loved to buy foreign brands for children, told reporters: "Now the design of domestic children's clothing is getting better and better, and there are still many co-branded models."

Thanks to the success of the transformation, the fashion of the domestic brand Taiping Bird has been recognized more and more among consumers, and its performance has continued to grow. On August 31, Taiping Bird (603877) released its 2021 semi-annual report. During the reporting period, the company achieved a year-on-year increase of 55.88 in operating income; net profit attributable to shareholders of listed companies increased by 240.52 year-on-year.

In the context of the rise of national goods, leading enterprises performed well. As of September 1, the semi-annual reports of 43 domestic listed textile and apparel companies have been published, of which 37 shares of net profit attributable to the first half of this year are profitable. Specifically, of the 37 profitable shares, 28 were in a state of growth, 22 were attributable net profit in the first half of this year increased by more than 50% year-on-year, and 17 were attributable net profit increased by more than 100 year-on-year.

Domestic sports brand revenue scale rose across the board. Anta Sports achieved sales revenue of 22.812 billion yuan in the first half of the year, not only continuing to rank first in the domestic echelon, but also surpassing Adidas's revenue in Greater China during the same period. In addition, Li Ning's revenue in the first half of the year reached 10.197 billion yuan, while Tebu International and 361 degrees were 4.135 billion yuan and 3.107 billion yuan respectively.

"In the first half of the year, the production of the garment industry recovered steadily, and the production of clothing continued to rise." Liu Jing, senior project director of the Ministry of Industry of the China Garment Association, said that online sales in the domestic clothing market have maintained growth, and physical sales have improved significantly.

Chen Xiaoqian, an analyst at the China Textile Federation Industrial Economic Research Institute, analyzed that from an industry-wide perspective, the textile industry's added value grew at 9.6 percent in the first half of the year, but the two-year average growth rate was 1.1 percent, lower than the same period in 2019, so it is judged that industry production is still in the recovery stage. From the consumer side, from January to July, sales of clothing, shoes, hats, and knitwear products were 767.3 billion billion yuan, an increase of 29.8 percent over the same period last year, which was 9.2 percentage points higher than the growth rate of total retail sales of consumer goods. The two-year average growth rate was 3.5 per cent, higher than the growth rate in the same period in 2019, based on which the domestic consumer market has recovered and maintained good growth in the first half of the year.

It is worth noting that the consumer market presents the characteristics of active online channel sales, frequent occasional explosives and strategic explosives, significant consumer demand for individuality, and better consumer experience brought by live e-commerce.

In this regard, Sun Ruizhe said that my country's textile industry has shown a steady and positive development trend, the quality and efficiency of development have been steadily improved, the role of the internal cycle has continued to strengthen, exports have maintained a good growth trend, and investment confidence has increased. At the same time, affected by the outbreak of new crown pneumonia, the textile industry value re-engineering and responsibility is continuing to be re-examined by all sectors of society.

Exports hit highest over the same period

With the slowdown of China's epidemic and the normalization of prevention and control and the continuous release of stable foreign trade policy dividends, China's textile export growth has been strongly supported. In the first half of 2021, China's textile and clothing exports reached the highest level in the same period in history.

According to data from the General Administration of Customs, from January to June 2021, textile and clothing exports totaled US $140.086 billion billion, an increase of 11.90 percent year-on-year and an increase of 12.76 percent over 2019. Of this total, textile exports were $68.558 billion billion, down 7.48 percent year-on-year and up 16.95 percent from 2019, while apparel exports were $71.528 billion billion, up 40.02 percent year-on-year and up 9.02 percent from 2019.

From the perspective of the industrial chain, the rapid decline in the export of textile products (including masks) 63079000 by China's customs tariff number is an important factor in the decline in textile exports in the first half of this year.

In response, Chen Xiaoqian analyzed that in 2020, the demand for epidemic prevention materials will drive up the demand for textiles, resulting in a sharp increase in the proportion of textiles in export products, up to 60.3 percent. In 2021, with the remarkable achievements in epidemic prevention, textiles account for 47.7 percent and clothing 52.3 percent of the current export products, basically adjusting to the pre-epidemic structure, with the United States, the European Union and Japan importing masks from China significantly reduced.

The export situation of clothing, home textiles and other industries continued to improve, and the export of major commodities such as chemical fibers, yarns, fabrics and textile machinery in the industrial chain also increased. Yang Zhaohua, vice president of the China Textile Industry Federation and president of the China Home Textile Industry Association, said that in the first half of the year, the export of home textile products increased by 19.99 compared with the same period in 2019, with a good trend. among them, the growth to the United States, the European Union, Japan, Russia and ASEAN was 53%, 48%, 14%, 58% and 58% respectively. From the perspective of subdivided product categories, exports are mainly the original products. In addition to the attributes and consumer demand of home textile products, they also benefit from the advantages of my country's industrial chain.

From the perspective of export regions, in the first half of the year, China's western region's textile and clothing exports grew strongly, while the eastern region's exports grew. From the perspective of the top five provinces, Zhejiang, Jiangsu, Guangdong, Shandong, and Fujian were ranked by export amount. They exported textiles and clothing to US $36.78 billion, US $22.66 billion, US $21.71 billion, US $13.53 billion, and US $12.23 billion respectively, up 18.6 and 11.3 respectively.%, 4.5%, 28.0% and 35.8%.

According to the analysis of the China Textile Industry Federation, the current epidemic is still spreading around the world, the world economic recovery is unstable and unbalanced, the external environment facing China's textile exports is complex, and the cost pressure of textile foreign trade enterprises is increasing.

Domestic sales in the second half of the year are stable and good.

In the first half of the year, the domestic demand market for textiles and clothing recovered steadily, and the pulling effect on the smooth recovery of the industry's economic operation was enhanced. In the second half of the year, the textile industry is also looking forward to a better performance in the domestic market.

Ding Sijia, deputy director of the Industry Department of the China Printing and Dyeing Industry Association, believes that the fourth quarter of each year is the traditional peak season for the printing and dyeing industry. It is expected that companies will remain stable in the second half of the year, especially in domestic sales.

According to Liu Jing's analysis, the recovery of the domestic macro-economy will drive the simultaneous growth of residents' income and the continuous improvement of consumer confidence. The rapid progress of network technology and the vigorous rise of new consumption and new retail formats will inject strong impetus into the continuous innovation and development of the industry. The overall economic operation of my country's apparel industry in 2021 is expected to be significantly better than that in 2020, showing a stable recovery and a steady and positive development trend.

"In the second half of the year, the foundation of China's macroeconomic recovery continued to consolidate, and domestic demand is expected to stabilize and improve." Niu Shuangxin, an analyst at the China Textile Federation Industrial Economic Research Institute, said frankly that the risk factors faced by the textile industry still exist, such as the spread of the epidemic, which may have an impact on the recovery of the international market; the local rebound of the domestic epidemic, extreme weather and other factors increase the pressure on production and marketing of enterprises; commodity prices fluctuate sharply, increasing the risk of purchasing textile raw materials.

Niu Shuangxin predicts that the macro-economy is expected to continue to recover in the second half of the year, the growth rate of demand is gradually returning to normal, the development trend of textile industry repair is expected to continue, and the main indicators will show a "high before and low" trend with the increase of the base.

"In the late second quarter of this year, especially after July, the national industrial production, consumption, and fixed asset investment showed a slowdown in growth. This trend may continue in the second half of the year." Sun Ruizhe proposed that in the next step, the textile industry should strengthen the work related to the linkage between industrial transformation and upgrading and regional development strategies, promote the advanced industrial foundation and the modernization of the industrial chain, and also coordinate the promotion of carbon peaks and carbon neutrality.

In addition, he said that the textile industry should balance safety and development. With the stabilization of the epidemic, the global layout of the industry, the layout of the market pattern will become a prominent problem, to stabilize the textile in the domestic scale and system advantages. (Economic Daily-China Economic Net reporter Liu Jin)