Operation Analysis of Home Textile Industry in the First Quarter of 2019

Release time:

2019-05-27

In the first quarter of 2019, under the influence of various complex factors such as the complex international economic situation and the Spring Festival holiday, the overall performance of the home textile industry tended to be stable. Industry exports have increased steadily, and industry efficiency has declined compared with the previous year, but efficiency has improved. Enterprises are more optimistic about the industry's second quarter expectations.

　　The overall stable development of the 1. industry

According to statistics from the National Bureau of Statistics, in the first quarter of 2019, 1791 home textile companies across the country achieved main business income of 51.139 billion billion yuan, a year-on-year increase of 8.73 percent. The 219 backbone enterprises tracked by the association achieved main business income of 17.852 billion billion yuan in the first quarter, down 1.34 percent from the same period last year. The 16 home textile industry clusters tracked achieved a main business income of 55.056 billion billion yuan in the first quarter, up 2.72 year on year. The value of domestic sales in the industry shows the same trend. (See Table 1 .)

Table 1. Main indicators and year-on-year growth rate of home textile industry in the first quarter of 2019 (unit: billion yuan)

　　Data source: National Bureau of Statistics, China Home Textile Association

Judging from the situation of various sub-industries of home textiles, the main business income of the bedding industry fell relatively in the first quarter. The four bedding industry clusters tracked by the association achieved income of 23.069 billion billion yuan in the first quarter, down 3.56 percent from the same period last year. The main business income of 107 bedding enterprises tracked fell 1.80 percent compared with the same period last year. Towel and fabric industry as a whole to maintain a steady and good growth. The income of the home textile sub-industry under each statistical caliber is shown in Figure 1-Figure 3.

　　Data source: China Home Textile Association

　　Exports of 2. industry maintain stability and slightly increase

According to customs data, in the first quarter of 2019, the home textile industry achieved a total trade import and export volume of US $9.299 billion, of which exports were US $8.961 billion, an increase of 0.55 percent over the same period last year; imports were US $0.339 billion, down 1.42 percent from the same period last year; and a trade surplus of US $8.622 billion. Industry exports remained stable overall.

From the perspective of export product categories, bedding exports achieved steady growth. In the first quarter of 2019, bedding exports totaled US $2.785 billion billion, accounting for 31.08 percent of total home textile exports, and exports increased by 2.69 percent year-on-year. The growth rate of kitchen textiles is relatively large. In the first quarter, the export of kitchen textiles was 0.547 billion US dollars, an increase of 6.12 per cent over the same period last year, accounting for 6.10 per cent of the total export of home textiles. Exports of fabric, towels and blankets declined from the previous year. The export situation of all kinds of home textile products is shown in Table 2.

　　Table 2. Exports of major home textile products in the first quarter of 2019

　Data source: China Customs

From the perspective of the main markets for export products, my country's exports to several important markets achieved good growth in the first quarter of 2019. The three traditional markets of the United States, Europe and Japan are still dominant and their share is further expanded. In the first quarter, China's exports of home textile products to the United States, Europe and Japan totaled 4.669 billion billion US dollars, accounting for 52.13 percent of the industry's total exports, and its share continued to expand by 0.76 percentage points over the same period last year. Exports in the ASEAN market grew well in the first quarter, with an increase of 7.48 per cent, with exports of US $0.999 billion billion, accounting for 11.15 per cent of the industry's total exports, an increase of 0.72 percentage points over the previous year. Vietnam is the most important country in China's export of home textile products to ASEAN. In the first quarter, the export of home textile products to Vietnam totaled 0.29 billion US dollars, of which 0.139 billion US dollars were exported in March.

　　Table 3. The turnover of the main export markets of home textiles in the first quarter of 2019 and the year-on-year

　　Data source: China Customs

Due to the impact of Sino-US trade frictions, the export of tax-related carpet products to the US market fell by 27.32 in the first quarter compared with the same period last year, with an export value of 0.1 billion billion US dollars, the largest decline among similar export products. At the same time, carpet exports to the EU, Japan and ASEAN markets achieved good growth. (See Figure 4.)

Data source: China Customs

　　3. industry benefits decline, efficiency improvement

Under the influence of the global trade boom, the complex macro situation at home and abroad, and the Spring Festival factors, the production growth rate of the home textile industry slowed down in the first quarter, and the profit decreased year-on-year. The early closure of the market or the postponement of the opening of the market affects the normal business of enterprises. Profit promotion, enterprises to inventory more active, finished goods turnover rate increased compared to the previous year.

According to data from the National Bureau of Statistics, in the first quarter, 1791 home textile companies above designated size achieved a total profit of 2.03 billion billion yuan, a year-on-year decrease of 7.41 percent, and the rate of decline was narrower than the previous two months. The margin was 3.97 percent, down 0.69 percentage points from a year earlier. The 219 backbone enterprises and 16 industrial clusters tracked by the association also basically present this characteristic. (See Table 4.)

　　Table 4. Profit growth of home textile industry in the first quarter of 2019

　　Data source: National Bureau of Statistics, China Home Textile Association

The home textile production and sales index declined. In the first quarter of 2019, the production arrangements of home textile enterprises were affected by factors such as the Spring Festival holiday and weak domestic and foreign market demand, and the growth rate of industry production slowed down. According to the results of the "Textile and Garment Enterprise Management Questionnaire", the index of new orders for home textiles in the first quarter was 47.75, lower than the index for each period in 2018. Among them, the foreign orders index was 53.6, up 1.95 points from the fourth quarter of 2018. The production index was 51.1, down 8.35 points from the same period last year, but up 2.5 points from the fourth quarter of 2018.

Industry enterprises finished goods inventory decline, industry efficiency. According to the results of the "Textile and Apparel Enterprise Management Questionnaire", the inventory index of finished products in my country's home textile industry in the first quarter of 2019 was 38.6, a sharp drop of 19.95 points from the fourth quarter of 2018. It can be seen that the first quarter of home textile production enterprises to inventory more active, stocking slowed down, production enterprises of product inventory fell faster. According to the data of the National Bureau of Statistics, the turnover rate of finished products in the home textile industry in the first quarter was 16.52, an increase of 0.28 points over the same period last year.

Industry capacity utilization increased. According to the results of the "Textile and Garment Enterprise Management Questionnaire", in the first quarter of this year, 60.5 percent of the home textile sample enterprises' equipment capacity utilization rate remained above 80%, which was higher than the previous period and the same period last year. Equipment capacity utilization rate of less than 50% of the home textile sample enterprises have decreased compared with the previous year.

　4. companies are more optimistic about the industry's second-quarter expectations.

According to the results of the "Textile and Garment Enterprise Management Questionnaire", for the second quarter of 2019 order demand situation expectations, home textile sample enterprises have 34.1 of the sample enterprises choose to increase, 50.0 of the enterprises choose to "flat", the enterprise's prediction tends to be cautious.

For the second quarter of the main product production, home textile enterprises are optimistic about the future production judgment. The proportion of home textile enterprises that are expected to grow is 38.6, which is 5.3 percentage points higher than the increase in the production of their main products in the current period.

For the second quarter of 2019 profit judgment, the proportion of home textile enterprises with expected profit increase is 31.1, which is 6.7 percentage points higher than the proportion of home textile enterprises with actual profit increase in the current period. Indicates that the sample firms are optimistic about their earnings expectations for the second quarter (see Table 5).

　　Table 5. Profitability of home textile enterprises (%)

　　Data source: China Home Textile Association

(Note: This period is the first quarter of 2019 and the next period is the second quarter. The same below)

Enterprises on the next period of raw materials stocking attitude slightly positive. For the next period of raw material procurement is expected, 25.0 of the home textile sample enterprises chose to "increase", higher than the current sample of enterprises expected to increase judgment (see Table 6).

　　Table 6. The main raw material procurement quantity of home textile enterprises (%)

　Data source: China Home Textile Association

For the expectation of the overall operation of the textile industry in the second quarter, the proportion of home textile enterprises that chose "optimistic" was 37.8, 2.5 percentage points higher than that of the relevant options of the textile industry; the proportion of home textile enterprises that chose "general" was 55.6, 4.4 percentage points higher than that of the relevant options of textile enterprises, indicating that home textile enterprises are more optimistic about the overall macroeconomic operation in the next period (see Table 7).

　　Table 7. The views of home textile enterprises on the overall operation of the textile industry (%)

　　Data source: China Home Textile Association

For the judgment of the domestic and foreign markets in the next period, the sample enterprises are more optimistic about the expected increase in the two markets. It is expected that the domestic market demand for textile and clothing in the next period will "increase" and "flat" home textile sample enterprises will account for 88.6 of the total sample of home textiles compared with the current period. It is expected that the demand for foreign textile and clothing market in the next period will "increase" and "flat" home textile sample enterprises will account for 88.1 of the total sample of home textiles (see Table 8).

　Table 8. Expectation of textile and garment export market in the next period (%)

　　Data source: China Home Textile Association

On the whole, the overall market demand in the first quarter of 2019 is not strong, the order volume of home textile enterprises has declined compared with the previous period, and the enterprise prediction tends to be cautious. With the gradual improvement of the domestic market environment and the effect of relevant policies, there may be room for recovery in the second quarter, and enterprises' confidence in the operation of the second quarter has increased.

(Source: China Home Textile)

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