Weihai Enterprises’ Textile and Garment Exports Dropped by 60% at the Canton Fair
At the 104th Autumn Canton Fair held from October 15 to November 6, the export transaction volume of Weihai exhibitors was US$198 million, a year-on-year decrease of 10.8%, and the first decline.
From the perspective of traded goods, mechanical and electrical products, food and toys have become hotter in the cold, with transactions of US$78 million, US$36 million and US$21.34 million respectively, a year-on-year increase of 16.4%, 22.1% and 18.6% respectively. However, clothing and home textile products suffered a strong cold wave, with year-on-year sales both falling by more than 60%.
Textile and apparel exports dropped sharply by 60%
Textiles and apparel have always been the highlight of Weihai’s transactions at the Canton Fair. However, at this Canton Fair, Weihai’s textiles, apparel, handicrafts and other past highlights were It became much bleaker, with trading volume down by more than 60% year-on-year.
When analyzing the reasons, industry insiders believe that the competitive advantage of Weihai’s textile and clothing exports is based on low costs and few independent brands, so it has no advantages in external negotiations, price increases, and transactions.
In sharp contrast, agricultural products, as daily necessities, have been affected by the recent continuous rise in international market prices, and the transaction effect is significant. Weihai Dongwang Food Co., Ltd. has signed contracts with merchants with a total value of approximately US$6 million, and both intended customers and transaction volume have tripled year-on-year.
Another bright spot is that exports of mechanical and electrical products have maintained steady growth. According to Zhang Zhaopeng, deputy researcher of the Municipal Foreign Trade and Economic Cooperation Bureau, due to the obvious price advantage of my country’s mechanical and electrical products, many developed countries like to purchase high-quality and low-price Chinese mechanical and electrical products, which has led to Weihai’s mechanical and electrical product exports achieving a growth of more than 10% at the Canton Fair.
Some foreign businessmen attended the fair to cancel orders
At this Canton Fair, buyers from the European Union and the United States took sick leave one after another, and the number of attendees decreased by 20% to 30% year-on-year. Zhang Zhaopeng analyzed that the decline in the purchasing power of EU and US residents caused by the financial crisis was the main reason for the decrease in buyers from the EU and the US.
In addition, the prices of raw materials such as oil, iron ore, steel, rubber, zinc, nickel, and copper precious metals have continued to fall recently, and buyers attending the meeting have increased their expectations of downward prices for Chinese products. Most of them take a wait-and-see attitude, with many inquiries and few placing orders on the spot.
“Not only that, among the European and American merchants participating in the Canton Fair, many of them came not to negotiate purchases, but specifically to postpone or even cancel orders.” Zhang Zhaopeng said.
The person in charge of a home textile company in Weihai City told reporters that in order to prevent further losses, a European merchant canceled orders at will. Some would rather lose their deposits than cancel orders placed at the Spring Canton Fair.
“This phenomenon has never appeared in previous Canton Fairs.” The person in charge said.
Brand companies have strong ability to withstand shocks
Since this year, under the combined influence of factors such as the rise in the exchange rate of the RMB against the US dollar, rising prices of raw materials, rising labor costs, and weak external demand, most foreign trade companies have The profit and loss line hovers.
According to Zhang Zhaopeng, since the second half of the year, foreign trade companies have just shown signs of easing, and the intensifying financial tsunami has pushed many companies to the edge of life and death.
Out of concern that domestic companies may go bankrupt, some buyers would rather pay higher prices to purchase products from branded companies. According to statistics from the Municipal Foreign Trade and Economic Cooperation Bureau, at the current Canton Fair, 21 brand companies in Weihai signed export contracts worth US$149 million, accounting for 75.3% of the total contract value. The transaction price was 3% to 5% higher than that of non-brand companies.
Wang Jianbo, general manager of Weihai Haofei Group, said that the recent devaluation of the euro and the pound has caused exchange losses of millions of yuan to enterprises. Since they have a certain say in the underwear industry, foreign businessmen are forced to agree to bear most of the exchange losses.
But some small and medium-sized enterprises can usually only bear their own exchange losses. The person in charge of a toy company in Weihai City said that a Euro settlement order they made not long ago caused an exchange loss of 100,000 yuan.
Only products with high technical content are competitive
Due to the expansion of the scale of this Canton Fair, many small and medium-sized enterprises have the opportunity to participate. Judging from the transaction situation, products with higher technical content have taken most of the orders.
Weihai Celebrity Group brought a waste food recycling and processing machine with independent intellectual property rights developed in cooperation with Tsinghua University at the Canton Fair. As soon as the product was unveiled, it was favored by Japanese customers. Many Japanese customers said that they would go to the factory to inspect and discuss cooperation matters immediately after the exhibition.
The new product manual variable pump launched by Weihai Fuisi Mechanical and Electrical Company has realized the automation of agricultural machinery gears and adapted to the trend of increasing demand for agricultural machinery caused by food shortages. At this Canton Fair, a total of 200 customers from developing countries were received. Many visits were made, and export orders worth nearly one million US dollars were signed.
The person in charge of a company in Weihai City said with deep feeling that in the current situation of shrinking international demand, whoever has products with high technical content and unique selling points will be able to win in the difficult situation.
Emerging markets have become the main force in rescuing the market
“Judging from the current international situation, although economic growth has slowed down, the growth momentum of emerging economies and African countries has accelerated significantly.” Trade Management of the Municipal Foreign Trade and Economic Cooperation Bureau Branch staff said that although European and American customers are sharpHowever, emerging markets such as the Middle East, Africa, Russia, and South America have become the main force in rescuing the market.
It is understood that at this trade fair, the Middle East and Russia have jumped to the second and third places in Weihai City’s transactions, achieving an increase of nearly 20%. Emerging markets such as Africa and South America achieved a growth rate of nearly 40%AASDFWETGD
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