China’s textile orders transfer to Southeast Asia
Statistics from the Custom shows that in April, 2012, China imported 430,000 t cotton yarn, a 40% increase on a year-on-year basis. However, the exports of textile products have been declining markedly, showing the sluggish demands from the international markets and also the impact from the rising price of cotton at home. The price advantage of China’s textile export has been further mitigated, while the demands for import have become booming.
Meanwhile the import price of cotton from the global market has been declining because of the low demands,
pushing down the textile product prices. Statistics for the last 4 months show that the global market is still gloomy and the export of cotton textile products has been declining. Last year, the trade of cotton products between China’s Mainland and major markets of the world has contracted, with the market share of China’s cotton textile products in Europe, the U.S. and other developed countries has been shrinking.
The wider gap between the prices in domestic and foreign markets has brought huge pressures over Chinese cotton textile companies, with the number of orders shrinking, and some of them reducing or stopping production. Meanwhile, in the low-end market the Chinese cotton textile products have lost the price advantage. The Southeast Asian countries have been competing with China for the market share with their advantages in material and processing. Therefore, it is necessary for Chinese textile companies to rethink their business model under such a huge pressure.