Visit to the Canton Fair: The export situation of textile and garment enterprises is still grim
In January 2019, China’s textile quotas for export to the United States are about to expire. Will this stimulate the exports of textile and apparel companies? How much impact will the global “financial tsunami” have on the textile and apparel industry? How do companies respond? Yesterday, reporters visited the third phase of the 104th Canton Fair to learn about the new export situation of participating textile and garment companies.
Focus 1: Expectations for the cancellation of the US textile quota are not high
At 10 a.m. yesterday, the reporter came to Areas A and B of the Pazhou Exhibition Hall and found that the passenger flow in the exhibition hall for textiles and clothing and other products was less than The first and second phases were significantly reduced. “It’s relatively deserted. There haven’t been many visitors for two days.” Nanhai Yuanhuang Socks Co., Ltd. has been focusing on North America (excluding the United States) and South America as its main export markets. Manager Li of the company’s foreign trade department said when chatting with reporters that after participating in the exhibition for two days The number of overseas merchants coming to the booth for consultation and negotiation has significantly decreased. He is relatively pessimistic about next year’s export situation. “Last year, everyone expected that exports would rebound in the second half of this year, but who knew it would be worse than in 2007. Now everyone estimates that next year will be worse than this year.”
Regarding the issue that China’s textile export quotas to the United States will expire in January 2019, Li The manager is not “cold”. “Last year, customers told us that the quota would be canceled this year, but the result still has to wait until 2019. Will it really be canceled next year? This requires further observation.” He pointed out that the financial crisis caused by the subprime mortgage crisis has caused overseas consumers, Investors’ consumption and overseas investment mentality have changed greatly, especially the latter. More goods originally planned to be purchased in China are purchased domestically.
Chen Shaofeng, an exhibitor from Zhaoqing Qiaojiaren Textile Co., Ltd., also believes that even if the United States liberalizes the quota for Chinese textiles exported to the United States, due to low consumer confidence in the United States, there will not be a swarm of domestic textiles and garments entering U.S. ports a few years ago. The situation at the dock. “After the market is liberalized, the export volume is expected to increase accordingly in the third quarter of next year, but the volume is not expected to increase much.” He said that the occurrence of the financial crisis will automatically adjust the export behavior of enterprises, making it difficult for the United States to obtain a lawsuit against Chinese textiles. Anti-dumping or punitive tariffs.
Focus 2: New and old customers do not accept price increases
During interviews, reporters found that compared with the varying degrees of price increases in home appliances, ceramics and other industries this autumn, textile and garment companies Price increases are rare. Many companies have reported that due to the impact of the financial crisis, customers’ purchasing power has been relatively reduced, and the price of raw materials has dropped in the second half of this year, which has objectively made it more difficult for companies to increase prices.
“When I heard that prices were going to be raised, new merchants all opened their eyes.” Yan Litian, sales director of Nanhai Junbai Hat Bag Industry Co., Ltd., said that although there was a certain decline in various raw materials in the second half of the year, compared with the same period last year There is still a lot of increase. It stands to reason that companies have to increase prices to obtain corresponding profits. However, considering the seriousness of the overall foreign trade situation, companies still maintain the same level as last year in terms of export quotations. She said that although the company faces many unfavorable factors such as the implementation of the new labor contract law, rising raw material prices and the appreciation of the renminbi, it can only rely on the company’s internal digestion to solve the problem. “It is better to make less money than not being able to start work.”
Nanhai Relevant people from Jialishi Underwear also said that although the exhibitors this year are all new design products, since the company’s main customers are concentrated in Chile, Russia and other markets, the added value of the products is not too high, so there are no plans to increase the quotation yet. . “Old customers with higher quality requirements can afford the original higher prices, but if prices are raised, new and old customers will not be satisfied.” As for the current financial tsunami, this person believes that the temporary impact will not be big.
The heads of many participating textile and apparel companies also said that with the shrinking of overall overseas demand and the rise of textile and apparel industries such as India and Vietnam, the domestic textile and apparel industry is currently facing increasing competitive pressure. Under the influence of comprehensive factors such as weak domestic sales growth and slowing international demand, companies must first maintain a certain export volume before they dare to consider whether to raise prices and how much they will increase.
Focus 3: Setting up factories overseas to reduce the impact of the financial tsunami
Setting up branches overseas to reduce the impact of the financial tsunami. A few years ago, when domestic labor, land, energy, etc. were rising sharply, many Foshan textile and garment companies shouted the slogan of “setting up factories overseas”. During the interview, the reporter found that some textile companies in Nanhai have set up overseas companies or overseas marketing agencies in Latin America and other regions, and their role has been greatly played out when the financial tsunami hit us.
“We have established an overseas company in the Latin American country Panama a few years ago.” Manager Li of Nanhai Yuanhuang Socks Industry told reporters that Panama has become the procurement and distribution center for many foreign goods in the South American market. By setting up a company locally, Not only can they avoid possible anti-dumping, but they can also obtain higher profits. “South American merchants placed orders with our Panama company, and the quotations were higher than those of domestic companies.” He said that by accepting orders from overseas companies and producing domestically, it can effectively reduce the number of international trade intermediaries, exporters and other links, which can not only ensure the company’s orders, And effectively increase corporate profits. AASVSGRUTO
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