The Textile And Clothing Industry Is Difficult To Maintain High Growth In The Second Half Of The Year Due To Multiple Factors

In the first half of this year, against the backdrop of the global economic recovery, the textile and clothing industry has delivered a good report card. However, the export of the textile and clothing industry in the second half of the year is faced with many adverse factors, which are likely to lead to the unsustainable high-speed growth of exports.  

Data shows that the total export volume of textile and clothing in June was 18.665 billion US dollars, up 33.83% year on year. In terms of classification, textile exports increased by 44.43% year on year, and clothing exports increased by 28.07% year on year. In the first half of this year, China's textile and clothing exports totaled US $88.878 billion, up 22.04% year on year. Among them, textile exports totaled 35.652 billion US dollars, and clothing exports totaled 53.226 billion US dollars, with year-on-year growth rates of 32.31% and 16.02%, respectively. The export amount increased significantly and exceeded the level of the same period in 2008.

Kong Jun, an analyst with CIC Securities, believes that the impetus for the growth of textile and clothing exports in the first half of the year came from two factors: first, the global economy picked up and demand gradually rebounded; Second, the price of export products increased.

"There are many uncertain factors in China's textile and clothing exports in the second half of the year." Dai Ling, an analyst in the first textile web industry, analyzed that the global economy, especially the European economy, has not yet stabilized, while the cost of raw materials and other raw materials has risen steadily, and the supply and demand sides are currently in a state of stickiness in price. From the perspective of export orders of enterprises, the number of customers in European market who have always offered higher prices has decreased significantly, while in American market, although orders are still being placed, the prices are low and the orders are unstable.

Wu Xiaoyu, an analyst with Xiangcai Securities, also said that although the export growth of the textile and clothing industry in June exceeded most people's expectations, this rapid growth was not sustainable, and the rising prices of raw materials and labor costs would continue to squeeze the profitability of export enterprises. In the face of rising costs, the low cost advantage of the Chinese market is not obvious enough, and textile orders have gradually shifted to Southeast Asian countries.

In addition, some analysts believe that after the central bank restarted the RMB exchange rate reform, the expectation of RMB appreciation will be further strengthened, which will further weaken the competitiveness of the entire textile and clothing export industry and accelerate the transfer of foreign orders to low-cost countries such as India, Bangladesh and Vietnam. Dai Ling predicted that the overall trend of China's textile and clothing exports this year will be high at the beginning and low at the end, and the growth rate of textile and clothing exports in the second half of the year may fluctuate around 10%.