CHINA: Third quarter will be toughest period for textile exporters

China's textile industry highly depends on exports, while export market greatly depends on global economic rebound. Growth rate of China's textile and garment exports once reached 2.59 percent in March, benefited from increased purchase volume from overseas markets as they renewed low inventories, which greatly encouraged China's industry. However, the growth rate decline to -13.07 percent in April.

In review of the trend in the first half, China's total textile exports performed a downward movement; the outlook is not optimistic, although the decline narrowed in June.

It is noteworthy that the third quarter is traditional off-season of textile and garment exports. Trade value of clothing and accessories registered US $1.62 billion in spring Canton Fair, down 15.2 percent year on year, trade value of textiles reached US $1.61 billion, down 7.9 percent year on year, in addition, accumulated foreign orders of last year have been fully digested, so the third quarter will be the toughest period for textile exporters.

Although exports continue to decline, textile industry has released a number of positive signals. Data show that domestic textile sales continued to grow by 9.42 percent in the first 5 months, domestic sale proportion increased to 80.03 percent from 77.07 percent of the same time last year. Domestic clothing consumption increased from 15.6 percent in the first quarter to 22.1 percent in May, exceeding national growth rate of 21.6 percent of total retail sales level.

In addition, data from the China Textile Industry Association show that, above scale textile enterprises in China realized 43.248 billion Yuan in profits fro the first five months this year, down 0.14 percent year on year.