According to the statistics released by the General Administration of Customs today, from January to October this year, China's textile and clothing exports reached 245.72 billion US dollars, a year-on-year decrease of 9.2% (a year-on-year decrease of 3.4% in RMB), and the decline continued to narrow by 0.3 percentage points compared to the first three quarters. Among them, textile exports amounted to 112.55 billion US dollars, a year-on-year decrease of 9.8% (a year-on-year decrease of 3.9% in RMB); Clothing exports reached 133.16 billion US dollars, a year-on-year decrease of 8.7% (a year-on-year decrease of 3.1% in Chinese yuan).

In October, China's textile and clothing exports to the world reached 22.97 billion US dollars, a year-on-year decrease of 4.8% (a year-on-year decrease of 1.5% in RMB). Among them, textile exports amounted to 10.71 billion US dollars, a year-on-year decrease of 3.3% (a slight increase of 0.1% in RMB); Clothing exports reached 12.26 billion US dollars, a year-on-year decrease of 6.0% (a year-on-year decrease of 2.9% in Chinese yuan), a decrease of 0.6 percentage points from the previous month.

The current global economic growth rate is slowing down, the global textile supply chain is deeply adjusted, and the industry's foreign trade development is facing pressure. In the first three quarters of this year, China's textile and clothing exports to the three traditional markets of the United States, the European Union, and Japan decreased by 15.6%, 20.5%, and 12.3% year-on-year, respectively. However, at the same time, in the process of actively promoting the development of the "the Belt and Road" with the co construction partner countries, benefiting from the continuous optimization of the environment and smooth and convenient channels, China's textile and clothing exports to some countries along the "the Belt and Road" continued to expand. From January to September this year, China's exports of textiles and clothing to countries such as Russia, Kazakhstan, and Singapore increased by 20.4%, 52.4%, and 24.9% year-on-year, respectively. It is suggested that foreign trade enterprises in the industry actively seize the historic opportunity of entering a new stage of high-quality joint construction of the "the Belt and Road", open up diversified international markets, and strive to create more trade increment.

Strong Expectations and Weak Reality

Under the influence of factors such as sustained sluggish international market demand and gradual decline in domestic cost advantages, China's textile and clothing industry has encountered numerous obstacles in production, sales, and export recovery. The contradiction between strong expectations and weak reality is more prominent.

According to feedback from some cotton textile enterprises in Shandong, Jiangsu, Hubei and other regions, since late October, the ex factory price of cotton yarn has generally decreased by more than 1000 yuan/ton. Among them, the correction of OE yarn and high count combed/combed yarn is slightly lower, and the quotation for C16-C40 ring spinning/tight spinning yarn has been slightly reduced. However, the immediate profits of textile enterprises have still improved.

Insufficient new orders added

The biggest problem currently faced by enterprises is insufficient new orders, difficulty in maintaining normal workshop operating rates, continuous increase in yarn inventory rate, and gradually tightening cash flow. Although significant measures have been taken to alleviate the impact of cotton yarn traders reducing prices and selling off goods, as well as a large number of cotton yarn imports, the effect is not significant.

A medium-sized yarn factory in Zibo, Shandong Province, stated that based on current cash flow, yarn inventory, and future expectations, if there are limited new orders before mid December, production can only be reduced or even phased out. For adjusting equipment and processes to spin blended yarn and synthetic yarn, the company believes that on the one hand, the production of blended yarn in the market is already in an "oversaturated" state, and the difficulty of expanding the market is self-evident; On the other hand, the recovery of the textile and clothing consumption markets in countries such as Europe, America, and Japan still has a long way to go, and the export of blended and synthetic fabrics and clothing is stabilizing in the short term, with significant rebound pressure.

From the survey, it is expected that the proportion of some cotton textile enterprises in mainland China reducing or stopping production will be higher than the same period in 2022, and a few enterprises may even enter the Spring Festival holiday ahead of schedule, leading to a further decline in cotton consumption prosperity.

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