Affected by sluggish demand in major international consumer markets and geopolitical conflicts, China's textile and garment exports weakened in October, down 8.4% year-on-year, the decline expanded again compared with 6.5% last month, but it is still relatively moderate compared with the decline of more than 10% from May to August. Exports to the United States increased for the second month in a row, although exports to ASEAN continued to decline, but the decline in exports of yarn fabrics has narrowed for three months in a row, and exports to Bangladesh, Egypt and Central Asia and other important node countries of the "Belt and Road" maintain rapid growth.

Textile and garment export decline again expanded?

Four categories of commodity yarn, fabric, home textiles and woven clothing exports increased for the third consecutive month this month, and the decline in export prices of three categories of commodities except fabrics narrowed. From the data of January to October, the cumulative export value was 245.71 billion US dollars, down 9.2% year-on-year. Overall, although the decline has expanded this month, the overall trend of textile and garment exports to stabilize has not changed.

At present, China's economy continues to recover and the overall recovery trend is more obvious, and the state's measures to promote economic development and support private enterprises are constantly being implemented. A number of measures have been introduced to facilitate people-to-people exchanges between China and the United States. Regular flights between China and the United States have resumed to 70 per week. People entering China will be exempted from filling out health declaration cards from November 1, and unilateral visa exemption will be implemented for France, Germany, Italy, Spain, the Netherlands and Malaysia from December 1. Tax authorities have optimized export tax refund services, and the efficiency of export tax rebates has become higher and higher. In terms of the external environment, China's geopolitical pressure has eased recently, China and the United States have frequent exchanges at various levels, and the foreign ministers' meeting of China, Japan and the ROK has been held again after four years. This is of great significance to managing differences and stabilizing relations between China and relevant countries, and will also help stabilize market and business confidence.

However, the adverse factors affecting the export growth in the next stage should still be paid attention to. Macro-aggregate demand is insufficient, and micro-entities' business environment has not been fundamentally resolved. The foundation of the US economic recovery is not yet solid, the European economy lacks momentum, and the Japanese economy is still in trouble. The external situation is unstable, there is no sign of a truce in the Russian-Ukrainian war, and the Palestinian-Israeli conflict has intensified market concerns about the safety of shipping in the Red Sea and the Suez Canal. At the same time, despite the recent stabilization of Sino-US relations, the United States will accelerate the "nearshore" layout of the supply chain, and the strategy of "decoupling and breaking the chain" will not change fundamentally, which will further suppress China's export share.

Analysis of domestic textile and garment industry

The prosperity monitoring results of China Textile Federation Circulation Branch show that in November 2023, the prosperity index of managers of the national textile and garment professional market was 52.17, down 0.09 percentage points from 52.26 in October; The business climate index in the professional market was 52.04, up 0.66 percentage points from 51.38 in October.

1. Market performance improved

In November, the proportion of the selection of market total business was 73.33%, the proportion of the selection of market logistics shipments was 73.33%, and the professional market continued the good momentum of the sales season in November, the two indexes were higher than 50, and the business performance was better.

2, the market operation is good in November, the proportion of choosing the market open rate is 93.33%, the proportion of choosing the market passenger flow is 76.67%, the proportion of choosing the market rent is 93.33%, the market open rate, passenger flow and rent in November are basically flat compared with October, the operation is stable, and the three indexes are above 50. The market is working well.

In November, the proportion of total sales of selected merchants increased by 52.17%, an increase of 24.17 percentage points over October; The proportion of profit increase of selected merchants was 44.20%, up 14.87 percentage points from October; The proportion of flat sales price of selected merchants was 61.59%. Compared with October, the business situation of merchants in November increased sales volume, increased profits, and basically stable selling price. The three indexes were all above 50, and the business performance improved.

4, merchant pressure operation in November, the proportion of merchant comprehensive cost flat is 71.01%, the proportion of merchant inventory flat is 58.70%, the two indexes of merchant operating cost and inventory are lower than 50, it can be seen that the merchant operating pressure is still large.

5, e-commerce sales growth in November, the proportion of e-commerce sales increase in the selection market was 46.67%, an increase of 33.77 percentage points over October; The proportion of e-commerce sales increase of selected merchants was 34.06%, up 24.06 percentage points from October; Both indexes are higher than 50, and there is a significant increase, it can be seen that November is the peak season of e-commerce sales, e-commerce sales growth is obvious.

According to the forecast index data, the managers' climate index for the next period was 52.67, up 0.73 percentage points from 51.94 in October; The business environment index for the next period was 52.67, up 0.73 percentage points from 51.94 in October. In terms of businesses, the business climate index in the next period was 54.49, up 2.29 percentage points from 52.20 in October; The business environment index for the next period was 54.20, up 2.13 percentage points from 52.07 in October. It can be seen that managers and merchants have strong confidence in December operation.

The "carbon Tariff" is officially in effect! What is the impact on Chinese textile enterprises?

Recently, according to the World Bank research report, if the "carbon tariff" is fully implemented, in the international market, Chinese manufacturing may face an average 26% tariff, and exports may decline by 21%.

On September 14, at the regular press conference of the Ministry of Commerce, some media mentioned that the European Commission announced the implementation rules of the EU Carbon Border Adjustment Mechanism (CBAM) transition period will officially take effect from October 1 this year. It lasts until the end of 2025. The official tariffs will be officially imposed on January 1, 2026, and fully implemented by 2034. The rules set out the obligations involved for importers of goods under the EU's Carbon Border Adjustment Scheme and the transitional method for calculating the amount of greenhouse gases released during the production of imported goods.

A carbon tariff is a border measure that focuses on the carbon content of a product. The scientific name of carbon tariff is also known as the carbon border adjustment mechanism, the English abbreviation CBAM, the mechanism refers to the production of some goods will release carbon dioxide and other greenhouse gases, these goods into the EU border, need to pay an additional payment to the EU, the amount of greenhouse gases released during the production of goods related to the amount of greenhouse gases.

The EU will become the first economy in the world to impose a "carbon tariff". This also means that high carbon emissions at any point in the supply chain will lead to more carbon control costs for exported products.

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