A Brief Analysis of Foreign Trade Index in May 2012

In May 2012, the foreign trade prosperity index showed a slight rebound. The textile industry's exports are still severe. In 2012, the operation of the Chinese textile industry showed a trend of slowdown, the growth rate of production of major products slowed down, and the number of textile and apparel exports showed negative growth, and the growth rate of industry profits declined. The textile industry continues to face high external risks. Further improvement of risk control and response capabilities will be the top priority for the Chinese textile industry this year. In 2012, the growth of the major operating indicators of textile enterprises above designated size in China slowed down significantly, and production maintained low growth. China's textile industry experienced a negative growth in the number of exports. Among them, China's textile and apparel export growth to Japan, the European Union, and the United States all slowed down. The share of the three major markets has declined, while the situation of exports to the EU has been the most severe.

Exports in the textile industry still have some difficulties. In 2012, due to the impact of the European debt crisis and the recovery of the US economy, the textile industry still has some difficulties in export, and the sales decline is still relatively obvious. Textile companies have always been underemployed, and exports to Europe are still under pressure. Demand in the international market is still under pressure and uncertainties, which will affect the export growth of the industry. The fluctuations in the raw material market will be the major risks facing the textile industry.

Various factors restrict exports. The international economic recovery will remain in a relatively difficult period. The situation in Europe and the United States is not optimistic and the market still lacks confidence in the future international trade environment. The apparent increase in manpower, production, and labor costs, and the difficulty in recruiting workers everywhere are a huge pressure on the labor-intensive industries such as the textile and clothing industry. Due to the substantial increase in labor costs in China, international buyers have continued to transfer some textile and apparel orders to Southeast Asian countries such as Vietnam and Bangladesh. *** The risk of exchange rate fluctuations that the appreciation may bring is also an important factor in the current export companies' failure to accept large orders and long orders.

Shaoxing County's foreign trade exports are developing in contrarian conditions. Due to the weak international market demand, international buyers' transfer of some textile and garment orders to Southeast Asian countries, and the impact of uncertain factors such as the appreciation of renminbi and monetary policy, it has brought difficulties to Shaoxing County export enterprises. In May this year, Shaoxing County’s foreign trade The export situation as a whole showed a trend of contrarian growth, which was boosted from April.

By taking advantage of the east wind of the Keqiao Spring Textile Expo, the pace of transformation and upgrading of textile enterprises in Shaoxing has accelerated. Keqiao has become a model for domestic industrial clusters and creative industries to follow suit. To support the development of creative industries and nurture new types of market players, Shaoxing County has successively introduced a number of preferential policies to encourage innovation and creativity. Creative organizations continue to emerge, and the concept of textile companies has undergone a fundamental change.

Globalization accelerates the expansion of foreign sales. China Textile City's “Global” series of docking activities has brought continuous customer resources to the market. Many companies gradually shifted their exports from Europe and the United States to markets in Asia, Africa, and Latin America. They used global marketing strategies to consolidate market share in ASEAN, the Middle East, Southeast Asia, South Africa, and West Africa, opened Latin American market shares such as Brazil and Mexico, and expanded Russia and Kazakhstan. Emerging international market share, China Textile City's share of exports to expand locally. The international logistics business of the market warehousing and logistics center with which it is supporting has grown rapidly. Its "inland direct customs clearance" has become the fastest-growing inland port for business in Zhejiang Province, helping the market expand its export share.

Some textile exports picked up. The foreign trade prosperity index of cotton and its blended fabrics, hemp and its blended fabrics, embroidered products, household textile fabrics, knitted crochets, and dipping, coating, and coated textile products rose in different degrees, stimulating the general foreign trade sentiment. The index picked up from the previous month.

In May 2012, the foreign trade price index showed a slight drop. Various factors caused a slight decline in the unit price of exports. From the perspective of receiving orders, the export volume in May was slightly larger than that in April. The advantages of creative products of some large-scale textile enterprises in Shaoxing continue to show. However, the recovery of the global economy is still relatively sluggish. In the short term, the operating conditions of domestic export companies are difficult to get a clear turn for the better. The exchange rate and labor costs are still rising, and corporate ** costs are still at a high level. Due to the decline in international oil prices, the international commodity prices stabilized and the price of domestic upstream polyester raw materials and cotton fell, causing the foreign trade price index to decline slightly in May.

Southeast Asian countries compete for the Chinese textile export market share. Competition in the international market continues to intensify. The cost advantage of China's textile industry maintaining strong competitiveness in the world continues to weaken. The growth rate of the industry's profits has declined somewhat. The global pattern of the textile industry is still undergoing subtle changes. Countries such as Vietnam, Pakistan, Bangladesh and Turkey are taking advantage of labor costs far lower than China to compete for the export market of Chinese textiles. Under the pressure of low-cost labor forces in countries such as Southeast Asia, some textile and apparel companies in Shaoxing and textile companies in China Textile City have only reduced their prices to accept some of the foreign orders. The profit margin of public products is still relatively compressed, and the price index of foreign trade in May has seen a month-on-month decline.

The unit price of some textile products showed a downward trend. In this issue, the foreign trade price index of chemical fiber filament fabrics, embroidered products, household textile fabrics, and dipping, coating, and covering textiles declined in different degrees, driving the general foreign trade price index to decline.

It is expected that the foreign trade prosperity index will rebound slightly in June 2012. In the first half of this year, the decline in exports and benefits of the industry may become even more pronounced, and the difficulties faced by small and medium-sized processing companies will become more pronounced. With the development of various new trade protection and green standards in developed countries, some of Shaoxing's large-scale textile and apparel companies are market-oriented, accelerating the pace of transformation and upgrading, and continuously seeking and developing through exploration and innovation. The entire industry has shown regional adjustments. Accelerate the trend of further optimizing the product structure, develop high value-added products, and reverse the long-standing status of the lowest value chain.