Economic Operation of China’s Technical Textile Industry in Q1-Q3

Currently, the global economy is still grappling with various uncertainties and the downward pressure is becoming more prominent. Although China’s national economy is showing signs of recovery, it is important to continue strengthening the foundation of economic stabilization. Facing complex and challenging internal and external environments, China’s technical textiles industry maintained a recovered trend during the first three quarters of this year. The decline in key economic indicators has been gradually reducing month by month. However, there is still significant pressure on exports due to sluggish demand from overseas.

According to data from the National Bureau of Statistics, the production of nonwoven enterprises above the designated size decreased by 3.7% year-on-year in the first nine months. Although the recovery momentum in nonwovens production slowed down in the third quarter, the average monthly production is still 2.6% higher than the second quarter. Cord fabric production for tires has been increasing because of the growing demand for vehicles. In the first three quarters, its production saw a year-on-year increase of 4.4%.

As for economic efficiency, technical textile enterprises above the designated size saw a decline of 6.6% in operating income and a decline of 29.7% in total profits in the first three quarters. However, it is worth noting that these declines have been narrowing since the second quarter. Additionally, the operating profit margin is at 3.4%, 0.6 percentage points higher than the previous quarter. 23.6% of technical textile enterprises operated in deficit, and the loss value of these enterprises grew by 23.1% year-on-year. Currently, the industry’s main economic efficiency indicators are improving, but they still face challenges such as fluctuations in raw material prices, lack of demand, and intense market competition.

Table 1: Growth Rate of Major Economic Indicators of China’s Technical Textile Industry, Q1-Q3

(Above Designated Size)

Source: National Bureau of Statistics

As for the listed companies, a total of 33 companies in the technical textile industry experienced a 1.3% decrease in total operating revenues during the first three quarters compared to the previous year. However, total profits increased by 1% year-on-year, indicating a generally stable business situation. Among them, 10 listed companies achieved growth in both operating revenue and total profit, while 9 listed companies operated at a loss. The listed companies in the sanitary textiles sector showed strong development momentum.

Table 2: The Exports of Main Products in China’s Technical Textile Industry in Q1-Q3

Source: China Customs

From the perspective of export destinations, taking Chapter 56 (Wadding, felt and nonwovens; special yarns; twine, cordage, ropes and cables and articles thereof) and Chapter 59 (Articles for Technical Uses of Textile Materials) as examples, in which technical textiles accounted for a larger share, Asia accounts for 57.1% of the total exports, which is the largest export destination of China. Followed by the European Union and Latin American markets, which have a share of 11.3% and 9%, respectively. The African market held a share of 8.7%, while the North American market held a share of 7.9%. As for destination countries, Vietnam, the United States, India, Indonesia, Japan, and South Korea are the main export destinations for Chapter 56 and 59 products. These countries account for 34.8% of the total exports.