Analysis of the Operation of Chinas Home Textile Industry from January to November 2022

In 2022, due to energy shortages, high inflation, and prolonged geopolitical conflicts, the global economy tends to decline. The domestic epidemic has repeatedly seriously affected normal production and life, and the production and sales scale of the home textile industry has shrunk, with overall stable profitability. The return of foreign trade orders and the fading of dividends have had an impact on industry exports. The overall stability of the domestic market demonstrates the resilience of industry development. The overall operation of the industry is stable and under pressure.
1、 Stable operation of the industry under pressure
（1） Obvious downward trend in exports
According to statistics from China's customs, the total export of home textile products from January to November this year was 42.451 billion US dollars, a year-on-year decrease of 2.5%; Among them, the export quantity decreased by 7.33% year-on-year, and the export unit price increased by 5.22% year-on-year. Due to the disappearance of order backflow dividends, frequent outbreaks of the epidemic, and the impact of factors such as global economic downturn and weak consumption, China's home textile product exports have shown a clear downward trend. Since the beginning of this year, the year-on-year growth rate of single month exports has narrowed month by month, and since August, the month on month growth rate of exports has continuously narrowed. Entering 2022, the export volume of home textile products in China has shown a significant narrowing trend year-on-year; The year-on-year change in export unit price is relatively stable, but it remains at a high level. The situation of volume reduction and price increase to a certain extent reflects the pressure on China's home textile industry's foreign trade - if price fluctuations are excluded, the actual downward trend of export quantity will be more severe; And the year-on-year high growth in prices includes the driving force of rising costs for raw materials, production, logistics, and other aspects of the enterprise, constantly squeezing the profit space of the enterprise.
From the perspective of major export markets, the traditional market demand in the United States, Europe, and Japan is weak. In 2022, due to the global interest rate hike and high commodity prices, global economic development is facing pressure, and the development fatigue of developed economies such as the United States, the European Union, and Japan is further evident. In November, the manufacturing PMI index of the United States, Europe, and Japan decreased to 49.0%, 47.1%, and 49.0%, respectively. From January to November, China's export of home textile products to the US, Europe, and Japan markets reached 17.805 billion US dollars, a significant decrease of 13.21% year-on-year.
Emerging markets, especially the ASEAN market, have resilience, and the economic development of the ASEAN region is relatively stable. From January to November, China exported home textile products to the ASEAN market to 7.488 billion US dollars, a year-on-year increase of 14.89%, of which the quantity increased by 10.54% year-on-year and the unit price increased by 3.93% year-on-year.
（2） Overall domestic sales tend to stabilize
The production and logistics pressures in the first quarter of this year were caused by the pressure of raw material costs and the spread of the domestic epidemic. Serious impact on enterprise orders, resulting in a significant decline in industry efficiency. With the improvement of the domestic epidemic prevention and control situation, the operation of the industry is gradually recovering, but the pressure still exists. The weak market demand limits the growth space of the industry, and the operating rate of home textile enterprises is basically maintained at around 80%.
With the gradual and effective control of the domestic epidemic and the implementation of the national economic stability package and follow-up policy measures, the domestic trade environment in the home textile industry has generally stabilized in the second half of the year. According to data from the National Bureau of Statistics, from January to November, the main business revenue of home textile enterprises decreased by 3.38% year-on-year, and the total profit increased slightly by 1.02% year-on-year. The domestic sales output remained generally unchanged from the same period last year, with a slight decrease of 1% in the first 11 months compared to the same period last year.
The 235 sample enterprises tracked by the association showed a slight increase in domestic sales output value of 0.5% year-on-year from January to November. The main business income of 12 key industrial clusters increased by 1.66% year-on-year from January to November, and the domestic sales output value increased by 1.53% year-on-year.
2、 Sub industry situation
From the perspective of the main segmented industries of home textile, the situation of bedding, towels, and fabric in the three major segmented industries is slightly different. The bedding industry as a whole remained stable, while the towel industry continued to contract, while the fabric industry's growth rate declined.
（1） Bedclothes
The bedding industry is generally operating smoothly. From the perspective of export situation, according to customs data, China exported 12.43 billion US dollars of bedding from January to November, a year-on-year decrease of 15.08%. The traditional markets in the United States, Europe, and Japan have significantly declined, while the ASEAN market still maintains a high level of growth.
According to data from the National Bureau of Statistics, the operating revenue of bedding companies decreased by 7% year-on-year from January to November; The total profit increased by 4.29% year-on-year. The association tracked and counted over 100 bedding companies, with their main business revenue increasing by 3.75% year-on-year from January to November, and their total profit increasing by 12.43% year-on-year. From the monthly trends, it can be seen that in the first quarter, the production and operation of the bedding industry were affected by epidemic lockdowns and other factors, but this situation has returned to normal with the effective control of the epidemic. The industry efficiency has maintained double-digit growth.
（2） Towels
The towel industry is generally showing a contraction trend. According to customs statistics, China exported 2.421 billion US dollars of towels from January to November, a year-on-year decrease of 2.76%. In the main towel product export markets, except for the Japanese market, which has maintained growth, there has been a varying degree of decline in other markets, with exports to the top ASEAN market decreasing by 3.44% year-on-year.
According to data from the National Bureau of Statistics, from January to November, the operating revenue of towel enterprises above designated size increased slightly by 1.13% year-on-year, and the total profit decreased by 15.05% year-on-year; According to data from 30 towel sample enterprises and industrial clusters tracked by the association, the main business revenue of towel enterprises decreased by 4.22% year-on-year, and the total profit decreased by 9.96% year-on-year. The emergence of emerging products such as facial towels and cotton soft towels may have an impact on the consumption demand for traditional towels, but the exploration of product process technology research and development upgrading and cultural and creative branding by towel industry enterprises has also injected new vitality into the industry's transformation and upgrading.
（3） Fabric art
In 2022, there was a turning point in the growth of fabric art, and on the basis of maintaining high-speed growth in recent years, there was a decline. The significant decline in exported fabric products such as curtains and decorative fabrics is related to the high base caused by the return of foreign trade orders from the previous year; Meanwhile, the weakness of major developed economies and the significant decline in demand caused by geopolitical conflicts have had a significant impact on the demand for fabric products in the market.
According to customs data, in the first 11 months of this year, China exported 15.887 billion US dollars in fabric products, a year-on-year increase of 3.24%, including 10.446 billion US dollars in exported fabric surface accessories, a year-on-year increase of 8.22%; Exporting manufactured goods such as curtains amounted to 5.441 billion US dollars, a year-on-year decrease of 5.14%. The ASEAN market plays a strong driving role in the export of fabric accessories. Due to the pandemic, a large number of textile and clothing orders have flowed to the ASEAN region, which may drive them to increase their imports of fabric and accessories to China.
According to data from the National Bureau of Statistics, from January to November, the operating revenue of fabric enterprises above designated size decreased by 3.33% year-on-year, and the total profit increased by 14.59% year-on-year; The association tracked and counted over 100 fabric enterprises, with a slight year-on-year increase of 2.91% in revenue in the first 11 months of this year, which has returned to positive growth compared to the first few months of this year. The total profit decreased by 3.09% year-on-year, gradually narrowing compared to the first few months of this year.
Overall, the home textile industry maintained a stable operating trend in 2022, but the pressure remains significant. Deepening transformation and upgrading, improving development resilience, and resolving risks and challenges remain the themes of industry development. Many home textile enterprises have tried to make breakthroughs under the general trends of China-Chic, Great Health and Sustainability. After entering the fourth quarter, with the arrival of traditional consumption peak seasons such as the National Day and the "Double 11", as well as the further implementation of various national policies and measures, the economic situation of the home textile industry in 2022 will basically remain stable under the support of the domestic systemic circulation.
Looking at the world, factors such as repeated outbreaks of the epidemic, inflation, geopolitical conflicts, and trade frictions that have led to sluggish global economic development have not yet subsided, leading to a sustained downward trend in the global economy, thus putting enormous pressure on China's home textile industry's export trade. The 2022 Central Economic Work Conference has made it clear that greater efforts should be made to promote stable scale and optimized structure of foreign trade. This indicates that a series of stable foreign trade policies aimed at fully stimulating enterprise vitality, reducing enterprise burden, and promoting market diversification will be introduced one after another, which will play a positive role in assisting the stable development of the home textile industry. The industry as a whole still needs to adhere to in-depth structural adjustment, accelerate transformation and upgrading, stabilize the release of development resilience and risk resistance, and strive to promote high-quality development of the industry and achieve new results in complex situations.