In the first three quarters of 2019, my country’s textile and apparel trade exports reached US$202 billion, a decrease of 2.8%. The total value of Sino-US trade was 3.4 trillion yuan, down 11.1%, accounting for 11.9% of China’s total foreign trade value. Exports to the EU were 2.67 trillion yuan, an increase of 9.5%; my country’s total imports and exports to countries along the “Belt and Road” were 8.35 trillion yuan, an increase of 9.9%.
Statistics show that my country’s textile and apparel trade exports have been hindered this year and are showing a straight downward trend. Among them, imports and exports to major markets such as the EU and ASEAN increased, but imports and exports to the US market declined. As we all know, the textile industry is going through a recession this year, and the decline in foreign trade is even worse than domestic trade. The Sino-US trade war can be said to be the biggest inducement. Since this year, textile companies have faced greater difficulties in coping with the Sino-US trade friction.
Review of this year’s foreign trade situation
First, review this year’s foreign trade situation. In January, due to the rush for goods before the Spring Festival, there was a small wave of foreign trade orders, but they did not last long and the total volume was not large.
After the Spring Festival, the “Gold, Three, Silver and Four” products ushered in the peak season, but they were still lacking in popularity, and the order volume dropped compared with the same period last year.
After May, the overall market entered the off-season ahead of schedule. The off-season phase lasted until the end of August. Foreign trade orders showed the characteristics of “small batches and multiple batches”, and the market mentality was relatively calm.
With the arrival of the traditional peak season after September, the foreign trade market also began to recover. Coupled with the urgent demand during the Christmas season, the market has ushered in a small “climax”.
After November, foreign trade orders fell again and ran smoothly.
Since December, foreign customers have once again placed concentrated orders in order to complete fabric orders before the Spring Festival.
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The trade friction between China and the United States continues, and Boss Bu is blocked from accepting orders
We can see that, This year’s foreign trade market is relatively stable, and even the traditional peak season is lacking some heat. The main culprit for this situation can be said to be the Sino-US trade war.
Effective May 10, 2019, the U.S. government announced that it would increase the tariff rate on a list of US$200 billion worth of goods imported from China from 10% to 25%.
On August 5, 2019, the United States recently announced that it plans to impose an additional 10% tariff on US$300 billion of Chinese goods exported to the United States.
On September 11, 2019, the Tariff Commission of the State Council announced the first batch of exclusion lists for goods subject to tariffs on the United States and Canada.
In October 2019, the U.S. Department of Commerce stated that it would initiate an exclusion process for products on China’s $300 billion tariff list starting from October 31.
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Due to the continuous trade war between China and the United States, and the relationship has been volatile Complex, showing an unstable state. Based on this background, it has affected the orders received by textile companies and greatly reduced the number of fabric orders received. In particular, every time news of additional tariffs comes out, it directly affects textile companies, and in serious cases they are even forced to cancel orders.
The person in charge of a large foreign trade company in the Shengze area said that the Sino-US trade war has a profound impact on our company. Sometimes customers cancel orders, which is the most direct. Going further, the Sino-US trade relationship is unstable, and the relationship with American customers is equally unstable, which will affect subsequent orders.
2
China Textiles and Apparel The share has been occupied by Southeast Asian countries
In the past two or three years, Southeast Asia’s textile industry has developed rapidly, especially Vietnam, which has become the world’s largest textile exporter. In the first nine months of this year, Vietnam’s textile and clothing exports were approximately US$29.24 billion, a year-on-year increase of 9.23%.
Additional tariffs How it will be borne has troubled Sino-U.S. trade. No matter who is responsible for it, and no matter what the proportion of responsibility is, it will weaken the competitiveness of China’s textiles and apparel in the U.S. market. The market share of Chinese textiles and apparel in the United States will be partially squeezed out by the rising Southeast Asian textile industry.
A foreign trade textile manager said: “One of my main customers, the order volume last year is US$1.5 million, but this year’s orders are less than US$500,000. According to customers, they were hesitant to choose Chinese manufacturers or Southeast Asian manufacturers this year, so they placed part of their orders with Southeast Asian manufacturers. ”
Another foreign trade textile salesperson said: “One of my customers got a price from Cambodia this year that was 3% higher than my quotation, but there is zero tariff on imports from Cambodia. China’s import tariff is 12%, and there is a 9-point gap. Customers choose Cambodia without hesitation. ”
3
The exchange rate of RMB against the US dollar fluctuates greatly, making it difficult for Mr. Bu to quote
The exchange rate of RMB against the US dollar It also has a profound impact on foreign trade companies. In the first three quarters, the overall exchange rate of RMB against the US dollar fluctuated greatly, ranging from 6.68 to 7.17, and the annualized volatility of the central parity rate of RMB against the US dollar was 2.98%. Frequent fluctuations in exchange rates have given Boss Bu’s quotation caused a lot of trouble. Just a few days after the perfect gold price was quoted, the exchange rate changed. In addition, the fluctuation of the exchange rate is also a test for Boss Bu’s foreign exchange settlement. Only by grasping the accurate settlement time can the exchange rate be brought losses to a minimum.
2 On June 1, the central parity rate of RMB against the US dollar dropped by 414 basis points to 6.7495, the largest daily decline in more than half a year.
On June 7, the offshore RMB exchange rate against the US dollar fell significantly, and then The decline expanded, once falling below the 6.96 mark and hitting 6.9624, a new low since November 2018.
In early Asian trading on August 5, the onshore RMB fell below the 7 integer mark against the US dollar. The lowest was reported at 7.0532.
On November 5, the RMB exchange rate against the US dollar returned to the “7” yuan mark again. After opening at 7.0298, it rose from the afternoon and finally closed at 6.9975, which was the highest level on August 5. A new high since Japan.
On December 10, the central parity rate of RMB against the US dollar was reported at 7.0400, an increase of 5 points.
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An old master in Shengze who has been engaged in textile foreign trade for more than ten years believes: “We are not afraid of rising or falling exchange rates. What we are afraid of is large fluctuations, which will make customers wait and see for a long time, hinder placing orders, and it will be difficult to negotiate prices. Not easy, easy to repeat. So what we prefer is a stable exchange rate. ”
Conclusion
This year’s foreign trade companies have been greatly affected by external factors. The number of orders received is not large, and the profit margin has dropped significantly. Experienced In a dull year, cloth bosses are full of expectations for the market sentiment next year. The editor believes that whether the foreign trade market will improve next year largely depends on the Sino-US trade war. Although judging from the current foreign trade order volume, The number of orders received by companies has improved to a certain extent, but it is not enough to drive the entire market. Therefore, foreign trade companies still need to pay close attention to the Sino-US trade war in the future.
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