The Profit of textile enterprise Shrinked in First Four Months

The Ministry of Industry & Information Technology recently released China Industry Economic Operation Report 2011 Spring Edition, which estimated the steady growth of consumer product industry in the future. From Jan. to Apr, the industrial added value of statistics-worthy consumer product industry rose 14.2%; that��s 1.4 percentage points lower from a year ago. Of which, the pace of growth in April was 13%. While the textile industrial added value rose 9.9%, but 3.2 percentage points lower from a year ago. Referring to the main products, the output of yarn were 8.46 million tons, rising 10.6%; fabrics 17.9 billion meters, rising 15.7%; clothes 7.37 billion pieces, rising 13.5%. Since most provinces had raised the minimum wage level this year, people��s income, especially those in rural area, increased. Besides, more consumption-encouraging policies were released. Supported by the domestic consumption rising and international market recovery, the industry economy would go further. It is estimated that the industrial added value of consumer product industry will grow at the pace of 14% in the first half of this year.

Regarding the price, the yeild of mass agricultural product kept stable growth and the price of domestic cotton fell back quickly. In April, the pirces of domestic cotton type 328 and pure cotton yarn in Qianqing Market were 26,927 yuan per ton and 35,600 yuan per ton, rising 63.6% and 45.3% respectively from a year ago, but dropped 3201 yuan per ton and 1500 per ton from a month ago. The prices of polyester chip, staple and filament were 12,925 yuan per ton, 13,500 yuan per ton and 16,150 yua per ton, or dropped 575 yuan per ton, 900 yuan per ton and 100 yaun from a month ago respectively.

Regarding the export, the delivery value for export of texitle and clothes rose 21.5%, or 6.7 percentage points higher from a year ago. Based on the Customs data, the export of textile, clothes and shoes were 28.9 billion USD, 39.6 billion USD and 11.9 billion USD in first four months, rising 34%, 22.9% and 22.9% respectively.

In the consumer product industry, most SMEs focus their sales in international market and are sensitive to issues like RMB appreciation and interest rising. Due to cost increase and exchange rate fluactuation, some export-oriented textile SMEs reported profit reducing and struggling in the edge of losses. According to the statistics of China National Textile & Apparel Council, the financing cost of textile industry in first quarter rose 40.2% from a year ago, far beyond the income growth rate of 7.6%.