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Canton Fair: Textile And Clothing Exports Under The Shadow Of Subprime Lending And Appreciation

2008/4/21 15:49:00 37

Canton Fair: Textile And Clothing Exports Under The Shadow Of Subprime Lending And Appreciation.

Experts believe that the subprime mortgage crisis in the United States will affect the export of Chinese textile and clothing products, and the best way to overcome difficulties is to increase the added value of products, diversify the international market and expand domestic sales.

Zhu Sujun, general manager of the International Trade Department of Shanshan Group, seldom smiles.

Spent tens of thousands of yuan to participate in the Canton Fair, and the number of customers and turnover has dropped by about 50% compared with the previous one. Especially in the past, there were few buyers in the United States. How can we not let Zhu Sujun worry?

The first phase of the 103rd Canton Fair ended yesterday. As of 19, data showed that the number of purchasers in the United States was 5852, a decrease of 1399 over the same period last spring.

Many exhibitors believe that the export situation is not optimistic in the second half of the year.

Customs statistics also showed that exports to Guangdong in the first quarter of this year showed significant decreases in many important commodity categories, including automatic data processing equipment and parts, clothing and accessories, plastic products and toy exports, which fell by 8.6%, 25.6%, 10.7% and 6.3% respectively.

The shock wave of the US subprime crisis is being passed on to "made in China" by overseas buyers, and the result of the appreciation of RMB has aggravated the business difficulties of export enterprises.

This is the personal experience of many foreign trade people in China.

The Americans have a flat waist.

The shrunken waist of foreign buyers is undoubtedly the direct cause of export difficulties.

Ben Noonan, a purchasing manager from SmArtful Home, told the first financial daily that many large retailers in the US are having a bad time. "The consumer market is pretty bad."

The subprime mortgage crisis has led many Americans to tighten their belts.

Many Americans are beginning to change the habit of lavish spending. Many people will queue up for the sale in the middle of the night, and the retail sales of big shopping shops are also decreasing.

The latest survey shows that the US consumer confidence index in March is only 64.5, the lowest level since 2003, and it has dropped sharply for third consecutive months.

The United States is one of the most important export places in China. Statistics from the General Administration of Customs show that bilateral trade between China and the United States totaled 73 billion 670 million US dollars in the first quarter of this year, an increase of only 10.5%, and the pace of US exports slowed down significantly.

Even Chen Deming, Minister of Commerce, admitted in a media interview at the Canton Fair that he is paying close attention to this trend.

Originally, the global economic slowdown and the decline in market demand have made western buyers feel pressure, and it is becoming a reality that the trend of supplier price increases has made them anxious.

Ben told reporters that at the Canton Fair, many Chinese suppliers had a raise of around 10%, but because of good long-term cooperation with Chinese suppliers, he did not want to give up them. "According to the current situation, we dare not place orders easily. We can only continue to make enquiries and make plans in a few days."

In fact, the consumer market has shrunk by the subprime crisis and is spreading from the United States to Europe and Asia.

David Hampson, purchasing director of Browning Enterprises group, the largest footwear importer in the UK, told reporters: "since last year we felt the pressure.

It's hard to find a cheaper supplier than last year. In the past 20 years, the price of Chinese products has always attracted us, but now we find that the era of cheap Chinese products seems to have passed. "

He told reporters that in order to prevent a sudden drop in demand in the UK, it may buy fewer products this year than last year.

At the same time, in addition to the Canton Fair, he will also go to Chengdu, Chongqing and other cities to find suitable suppliers.

In the view of David Hampson, products from India and other countries will become strong competitors of Chinese products after losing the price advantage, though this trend is not obvious.

Exchange rate factors add to the damage

Compared with overseas buyers, many Chinese manufacturers are facing more pressure than others.

On the one hand, they worry that the price increase will not keep up with the cost rise and lead to losses. On the other hand, they are worried that they will lose their orders due to price increases and factories will not be able to continue.

In the case of Zhu Sujun's Shanshan Group, the United States has been the largest export market of the group, accounting for half of its annual export volume.

"Us orders have fallen sharply this year."

Zhu Sujun said, "before the average American customer had 30 thousand sets of suits every month, 50 thousand times a year, and the total amount was about 3.4 million units a year.

But according to the current situation, it is estimated that orders will shrink by more than half this year, about 100 thousand to 150 thousand sets.

Shanshan Group plans to raise prices by 10% to 20% throughout the year, raising the price by 10% at the Canton Fair.

Customers are reluctant to accept such a price increase.

Zhu Sujun's answer is whether he can make a slight concession in price to attract American customers, but it is possible to fine tune, but there is not much room for profit margin, and orders that are too low in price can only be given up.

Textile and garment industry is a microcosm of "difficult export" at present.

In addition to the decrease in overseas demand, exchange rate is also an important factor in the decline of export profits.

According to the statistics of the first textile network, this year, the acceleration of RMB appreciation will start to encroach on the profits of the exporters, and the overall impact on the textile industry will be significantly higher than the previous two years.

The net predicts that the price of textile and clothing comprehensive export will increase by about 7.18% this year, and the appreciation rate of RMB will be over 10%.

That is to say, only RMB appreciation will squeeze about 3% of the profits of the textile and garment industry, while the average profit margin of the entire textile and garment industry last year is only around 3.9%.

Guangzhou textiles coming back from the US market