Monthly analysis report of China’s cotton textile industry in Aug.
Data from key enterprises and industrial clusters tracked by China Cotton Textile Association (hereinafter referred to as CCTA) shows that cotton textile enterprises’ production and operation have been steadily promoted in August 2021, and the growth rate of main economic indicators has slowed down from January to August. The key enterprises are better than industrial clusters.
First, the growth of operating revenue increased year-on-year, cost ratio decreased slightly
Tracking data show that from January to August 2021, the cumulative operating revenue of cotton textile enterprises increased by 24.3 percent year-on-year, 1.4 percentage points higher than that from January to July.
From January to August, the cumulative operating cost of cotton textile enterprises increased by 21.4 percent year-on-year, 0.7 percentage points higher than that from January to July. Operating cost accounted for 88.7 percent of revenue, down 0.5 percentage points from January to July.
From January to August, the accumulated operating revenue of cluster enterprises increased by 6.2 percent year-on-year, down 2.6 percentage points from January to July. Operating cost increased by 10.4 percent year-on-year, and the growth rate increased by 1.2 percentage points from January to July. The growth rate of operating cost was higher than that of operating revenue, and production and operation of cluster enterprises were under great pressure.
Second, export orders increased, export delivery value continued to improve
Tracking data show that from January to August 2021, the cumulative value of export delivery of cotton textile enterprises increased by 10.1 percent year-on-year, 0.7 percentage points lower than that from January to July. The export delivery value accounted for 12.9 percent of the industrial sales output value, up 0.7 percentage points from January to July. As the global economy continues to recover, orders from Southeast Asian countries are returning to China due to the impact of the pandemic, and enterprises’ export orders are increasing.
From January to August, the cumulative export delivery value of cluster enterprises increased by 13.6 percent year-on-year, 1.8 percentage points higher than that from January to July; the export delivery value accounted for 16.2 percent of the industrial sales output value, down 0.6 percentage points from January to July. Foreign trade orders increased, cluster enterprises export performance is better.
Three, profit margin decline, the percentage of loss-making enterprises slightly rise
Tracking data show that from January to August 2021, the industrial value-added of cotton textile enterprises increased by 16.9 percent year-on-year, 7.4 percentage points higher than that from January to July. The industrial value-added was 15.5 percent, down 0.6 percentage points from January to July.
From January to August, the total profit of cotton textile enterprises increased by 71.5 percent year-on-year, 15.2 percentage points lower than that from January to July. Profit margins rose 1.2 percent year-on-year, down 0.3 percentage points from the January to July.
From January to August, the number of loss-making enterprises in the cotton textile industry decreased by 62.8 percent year-on-year, which narrowed by 0.7 percentage points compared with January to July. The percentage of loss-making enterprises was 15.7 percent, 0.4 percentage points higher than that from January to July, and 26.5 percent lower than that of last year.
The industrial value-added of cluster enterprises increased by 8.7 percent year-on-year in January-August, 1.5 percentage points lower than that in January-July. The total profit increased by 13.4 percent year-on-year, and the growth rate was 4.3 percentage points lower than that from January to July, and the growth rate was lower than the tracked key enterprises.
In general, the tracked enterprises in August were running smoothly. Due to the impact of the pandemic, the delivery time of orders has been extended, and Christmas orders have been placed earlier than in previous years. The industry is not weak in the off-season, but raw material prices have risen sharply, RMB has appreciated, shipping costs have been rising, and corporate profits have declined. At present, China’s economic growth momentum is slowing down, the demand has also declined, industry operation is under pressure.
The data in this report are from CCTA, involving more than 260 cotton textile enterprises and about 15 industrial clusters in China. The total spinning capacity accounts for about 75 percent of the national cotton textile industry, which is representative of the industry.