Textile export growth is expected to continue its upward trend

According to Customs Express data, from January to May, my country’s textile and apparel exports totaled US$106.84 billion, a year-on-year increase of 3.6%. Compared with the same period last year, this export growth rate dropped by 10 percentage points. However, compared with the ups and downs at the beginning of this year, this is the third consecutive month that the exports of the textile industry have achieved steady growth, and positive signs have already appeared.
Since the beginning of this year, although the global economic recovery has not been as strong as expected, it has still strengthened compared with the previous year. The international market is generally stable, and the export environment of the textile industry is basically good. Judging from the trend, as the benign impact of economic macro recovery on the consumer market gradually deepens, the industry’s export growth rate is still expected to continue the current trend of steady recovery. While waiting for the market to improve, some inherent structural characteristics of the industry’s export growth are also worthy of attention.
First, the volume and price structure: raw materials drive prices downward, and price-led exports slow down. According to customs data, from January to April this year, my country’s textile and apparel export prices fell by 2.2% year-on-year, contributing -97% to the growth of total exports. The price decline is the main reason for the low growth rate of total exports. Excluding price factors, the export volume of textiles and clothing from January to April increased by 4.5% year-on-year, and the growth rate was only 2.3 percentage points slower than the same period last year. It can be seen that the physical export scale of the industry is still in a state of relatively stable growth.
This year, textile and apparel export prices have reversed the continuous upward trend since 2010. The main reason is the decline in raw material prices. The lower starting price of state-owned cotton has lowered cotton prices, and chemical fiber prices have continued to fall due to the imbalance between supply and demand, both of which have affected the prices of downstream products. In addition, fierce competition in the international market and the downward trend of the RMB exchange rate have also had a certain impact on the export pricing of textile companies. According to the market supply and demand situation, it is expected that the price of textile raw materials will continue to be low year-on-year this year, and the contribution of export prices to the growth of total exports will still be absent.
Second, product structure: price fetters yarn and clothing, and the performance of finished products is more eye-catching. Textile yarn in the upstream of the industrial chain is directly affected by raw materials, and export prices have dropped significantly, with a year-on-year decrease of 10.9% from January to April. Although the number of yarn exports increased by 8.9%, the export value still decreased by 2.2% year-on-year.
The export price of textile fabrics in the midstream is relatively strong, with a year-on-year growth of 2.2% from January to April. However, due to the slowdown in supporting demand for industrial chains in ASEAN and other markets, the quantity of textile fabric exports decreased by 1.5%, resulting in a growth rate of total exports of only 1.1%.
The export value of clothing and clothing accessories only increased by 0.9% from January to April, which was also affected by the 4.2% year-on-year decrease in export prices, of which the export price of cotton clothing dropped by as much as 13.3%.
Since fabric prices have not dropped significantly, the downward trend in clothing export prices also reflects to a certain extent that the international market competition environment faced by my country’s clothing companies is not relaxed.
Relatively speaking, the export situation of household and industrial textiles is more stable. From January to April, the export volume of textile manufactured products increased by 7.1% year-on-year, of which the price increase contributed about 53% and the quantity expansion contributed 47%.
Third, market structure: emerging markets experience fluctuations, while developed markets are stable and improving. ASEAN markets have experienced significant fluctuations this year. From January to April, my country’s textile and apparel exports increased by only 1.7% year-on-year, down 59.2 percentage points from the same period last year. Among them, clothing exports, which accounted for nearly 40%, fell by 11%, and the growth rate dropped sharply by 142 percentage points year-on-year, reflecting that domestic demand in emerging markets is still relatively fragile and susceptible to the impact of the macro environment. However, as the radiating effect of the recovery of developed economies gradually emerges, there is still room for improvement in the ASEAN market in the future.
The leading role of developed economies in global recovery has been demonstrated in the exports of the textile industry. The EU has become the highlight of this year’s export market, with both export volume and price rising. From January to April, my country’s textile and apparel exports increased by 15.1%, a year-on-year increase of 10 percentage points; of which the export price increased by 3.5% year-on-year, and the quantity increased by 11.2% year-on-year, an increase of 10.7 percentage points from the same period last year. The performance of the U.S. market was basically stable, with exports from January to April increasing by 5.4% year-on-year, a slight decrease of 1.9 percentage points from the same period last year.
(The author is assistant director of China Textile Economic Research Center and industry analyst)