Since the beginning of this year, with the continuous improvement of the international economic situation, China's textile and garment export industry has gradually begun to bottom out. However, industry analysts have analyzed that in the second half of this year, textile and apparel exports still face many pressures. The spread of the European credit crisis makes it difficult to reverse the downturn in the external demand market in the short term; and the continued appreciation of the RMB exchange rate will greatly weaken the competitiveness of China's textile and apparel exports to Europe. In addition, the increase in labor costs, the increase in the cost of raw materials such as cotton, also reduces the profitability of the textile industry.
As the uncertainties faced by China's textile exporting enterprises gradually increase, the pressure on them is also increasing. Difficulties in internal and external affairs have made textile export companies feel pressure.
Raw material prices rose sharply
The continuous and substantial increase in the prices of raw materials such as cotton and cotton yarn is the biggest pressure on cotton textile companies. Every change in cotton prices affects the entire textile industry. From the beginning of this year to now, in just a few months, cotton prices have skyrocketed by 20% to 30%. Domestic 328 cotton has climbed from 11,000 yuan per ton at the beginning of last year to more than 17,000 yuan per ton at present. The price of cotton yarn has increased even more. . For cotton textiles, the price of cotton yarn accounts for 60% to 70% of the cost of garments, and some even as high as 80%.
With regard to the sharp rise in raw material prices, cotton textile companies usually want to be able to ease the cost pressure by raising prices. However, at present, due to the weak bargaining power of most textile companies, there are very few companies that can successfully raise prices. Faced with the price pressures of traditional raw materials, some people in the industry put forward the view of using new materials, and the fifth largest natural fiber following cotton, hemp, wool and silk, bamboo fiber has become a hot spot in the industry. It is understood that in the domestic market, a plain woven shirt of bamboo fiber material is priced at about 33 dollars, and the market price of a bamboo fiber suit in Japan is as high as 500 to 1,000 dollars. The performance advantages of bamboo fiber make the textile products made with it as raw materials have higher added value, which will become a powerful driving force for the transformation and upgrading of China's textile and clothing industry and the increase of quality. The development of recycled bamboo fiber and the promotion of "bamboo cotton" can not only ease the tension of natural fibers, but also open up a new way for the rational use of bamboo resources in China. Green bamboo fiber, used in the textile and clothing industry, will push the textile industry to a higher level.
Labor costs increase
In addition to the increase in raw material costs, textile companies currently face the unfavorable factors of rising labor costs. Yang Zhaohua, president of the China National Textiles Association, said that the labor costs of the national textile industry have risen by more than 10% this year. The shortage of labor resources and rising labor costs have become one of the major issues facing the home textile industry.
The lack of work leads to an extension of the product's production cycle. In order not to breach the contract, the company had to change the sea freight to air freight. Temporary changes to the mode of transport not only erode marginal profits, but may also incur some of the cost. At present, China's labor costs are about twice that of India and three times that of Vietnam. The gradual loss of the advantage of cheap labor forces China's textile export competitiveness to decline.
For China's textile companies, the rising cost of labor is an unprecedented challenge, but this disadvantage is precisely the opportunity for the long-delayed labor-intensive enterprises to transition. China's traditional garment textile industry is often concentrated in the low-end manufacturing sector. Most of the companies focus on OEM production. R&D, design, branding, and marketing, logistics, and after-sales services are all â€œshort boards,â€ so they often end up only at the bottom of the value chain. Struggling, controlled by others. Experts pointed out that in order to change this situation, it is necessary to strengthen the technological innovation and product innovation of the enterprise, increase the added value of the products by increasing the technological content, and ultimately increase the competitiveness of the garment and textile industry.
Competitors rise in strength
According to data from the Chinese Customs and Japanâ€™s Ministry of Finance, from January to April 2010, Chinaâ€™s textile and apparel exports to Japan declined year-on-year, and the textile exports to Japan accounted for the proportion of Chinaâ€™s textile exports to the worldâ€™s total exports over the same period, and in Japan. The share of the textile market is declining.
While the share of China's apparel textiles in the Japanese market is declining, the share of competitors Vietnam and Thailand in the Japanese market is growing. From January to April 2010, Japan imported 448 million U.S. dollars worth of textiles and clothing, an increase of 3.59% year-on-year; Japan accounted for 4.08% of global total imports of textiles and clothing, an increase of 0.24% over the same period last year. During the same period, Japan imported textiles and clothing from Thailand at US$204 million, a year-on-year increase of 5.52%; Japanâ€™s share of global textile and apparel imports accounted for 1.99%, a year-on-year increase of 0.15%. Vietnamâ€™s growth in textile exports to Japan is partly due to Vietnamâ€™s own lower labor cost advantage, and on the other hand, due to the implementation of the Vietnam-Japan Economic Partnership Agreement (VJEPA), Vietnamâ€™s textile products can enter the Japanese market duty-free.
In the face of pressure from competitors, Chinese textile companies should actively develop new markets while vigorously exploring new markets, following the countryâ€™s â€œgoing outâ€ strategy, and avoiding export restrictions through overseas investment in factories. In many emerging markets, Africa is a non-existent option.
According to reports, since the 1960s, the Chinese government has helped Africa establish some textile projects. With the development of China's textile industry, in the middle and late 1990s, China's textile exports were subject to quota restrictions. Some companies avoided the quota restrictions and avoided trade risks. They went out to open up foreign markets, including factories in Africa and other places. With the stability of society, Africaâ€™s economic development is increasingly urgent. In Zimbabwe in southern Africa, a small garment factory with a scale of investment of only 1 million to 2 million yuan has set up a factory in the country and will withdraw its entire investment within one year. Africa is not only vast in territory and rich in resources, but also has a good investment and cooperation policy. For example, export products from African countries to Europe and the United States are not subject to quota restrictions, and can enjoy GSP and most favored nation treatment.
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