Recently, the editor saw a very interesting picture in the circle of friends.
In this picture The banner reads that a 25% tariff will be levied on tourists when dining. Although this is mostly funny, it also expresses the Chinese people’s reaction to the US’s tariff increase!
We all know that the trade friction between China and the United States has intensified recently. On the CCTV News Broadcast at 7 pm on May 13, the host Kang Hui broadcast an article titled “China is ready to respond comprehensively.” It received critical international reviews and was widely viewed on major social platforms.
Rui Commentary pointed out that China has long made clear its attitude towards the trade war initiated by the United States: it is unwilling to fight. But we are not afraid of being beaten, we have to fight if necessary. Faced with the hard and soft tactics of the United States, China has already given its answer: to talk, the door is open; to fight, it will stay with it until the end.
Subsequently, the Tariff Commission of the State Council issued an announcement on increasing tariff rates on some imported goods originating in the United States. The announcement stated: On May 9, 2019, the U.S. government announced that starting from May 10, 2019, the additional tariff rate on the $200 billion list of goods imported from China would be increased from 10% to 25%. The above-mentioned measures by the United States have escalated economic and trade frictions between China and the United States, violated the consensus between China and the United States on resolving trade differences through consultation, harmed the interests of both parties, and are not in line with the general expectations of the international community.
Among the tax items that are subject to an additional 25% tariff, there are a total of about 562 tax items of textile and clothing products; among the tax items that are subject to an additional 20% tariff, there are a total of about 113 tax items of textile and clothing products. ; Among the tax items subject to an additional 10% tariff, there are a total of about 100 tax items of textile and clothing products; among the tax items subject to an additional 5% tariff, there are a total of about 6 tax items of textile and clothing products.
A “Black Swan” is staged in the foreign trade market
It is understood that my country is the world’s largest exporter of textiles and clothing. At the same time, textiles and clothing exports are also an important part of my country’s trade exports, while the United States It is the largest export market for my country’s textile and apparel products. Especially in Jiangsu and Zhejiang areas where the textile industry is concentrated. Let’s hear what textile bosses think about it.
1. “This time the trade war intensifies, I will lose a lot of orders.”
A textile trader in Shengze area said: Our company still has a lot of cooperation with the United States. Yes, this time the trade war intensifies, I will lose a lot of orders, and a large number of American orders will be transferred to Southeast Asian countries. The profits of the previously negotiated orders have also been further reduced due to the increase in tariffs.
Another textile boss also looked worried: “The intensified trade friction between China and the United States will affect the rise and fall of raw materials. Recently, futures such as cotton, cotton yarn and PTA have fluctuated greatly, which can easily cause panic in raw materials. We What I hope most is that the international trade environment can be stable.”
This trade war is bound to heat up It will have a certain adverse impact on the textile market. If tariffs increase, our products will have to pay more costs to export to the United States, which directly leads to lower profits. Usually there are only two ways to digest this part of the increased profits. One is to reduce costs, but this is not easy to do. The other is to increase the price of the product. However, the market is currently in the off-season, and the market situation Wentun, customers will not accept price increases so easily. From this point of view, this increased cost can only be borne by the traders themselves.
2. “It’s not that scary, just make your own products well. Kingly way!”
Of course, some cloth bosses say it is not that scary. Mr. Bao from Fuqi Textile said that when many Southeast Asian countries receive orders from the United States, they actually still need to go to China to place orders, which is equivalent to Southeast Asia. Just a transit point. Moreover, Southeast Asian countries also have certain problems themselves, such as obvious deficiencies in completing orders with tight delivery times or orders with high labor complexity.
China needs the U.S. market, but at the same time, the U.S. market cannot do without China. Therefore, as long as we make our own products well, the problem is not that big. Furthermore, due to the recent impact of Sino-US relations, the exchange rate has remained high and has fallen below 6.9. In fact, this is good for our export-oriented enterprises, which can make a difference in the exchange rate. Cloth bosses, please stay calm, the problem is actually not that big!
It rained all night, and the foreign trade market was not in doubt. There are too many factors, and the impact on the domestic trade market is also huge!
The domestic trade market is not peaceful either!
At present, the production capacity of gray fabrics in other places is already saturated. Their gray fabrics are cheaper than local ones and the quantities are large. This is bound to have a huge impact on local companies. Some cloth bosses even complained to the editor that they used to ship at least 300,000 meters a month.However, this month, less than one-third is available, the cloth cannot be sold, and the backlog of inventory is increasing. According to the monitoring data of China Silk City Network, the current gray fabric inventory is about 39 days, which is about ten days higher than the same period last year.
When the market is good, manufacturers mostly produce according to orders, but when the market is bad, manufacturers Will reduce orders and switch to regular cloth production. Currently, orders are decreasing and regular cloth production is increasing. Factories with sufficient funds can afford to increase the production of conventional fabrics in the short term, while factories with greater financial pressure may increase the production of conventional fabrics, which may lead to operational difficulties due to increased inventory, and may lead to shutdown or closure of the factory. Dilemma.
Editor’s Note
China-US trade relations are uncertain and long-term , at the same time, the trade war is also an opportunity for the textile industry to coexist with opportunities and challenges. Textile companies can improve the quality of their products, broaden their sales channels, and make long-term plans. Properly explore emerging markets in countries along the “Belt and Road” and reduce risks caused by declining U.S. orders.
In the future, even if the new $300 billion list in the United States is officially implemented, I believe that textile companies will not be afraid of challenges through countermeasures such as opening up new markets and improving their own strength.
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