Since the beginning of this year, the domestic and international situation facing the dyeing and finishing industry remains complex and severe. The conflict between Russia and Ukraine has become a protracted war, the prices of bulk commodities have fluctuated at high levels, and the production costs of dyeing and finishing enterprises have increased significantly; developed economies such as Europe and the United States have accelerated the tightening of monetary policies to curb inflation, and the role of consumption in driving economic growth has weakened; domestic epidemics have occurred frequently, domestic demand for textile and garment products has been weak, and the operating rate of dyeing and finishing enterprises has been generally low. Although the industry's production and some economic indicators improved in September compared with August, the recovery process has been slow, and the foundation for sustained recovery is not yet solid. The stable operation of the dyeing and finishing industry still faces considerable challenges.
The rate of decline in output has narrowed. The overall pressure continues.
According to data from the National Bureau of Statistics, from January to September 2022, the output of dyed and finished fabrics by large-scale enterprises in the dyeing and finishing industry was 40.716 billion meters, a year-on-year decrease of 6.65%, with the rate of decline narrowing by 1.69 percentage points compared with the period from January to August, marking the first narrowing since the second quarter. In terms of month-on-month comparison, the output of dyed and finished fabrics by large-scale dyeing and finishing enterprises in September was 4.897 billion meters, an increase of 5.95% compared with August, and the monthly output rebounded after two consecutive months of decline. However, overall, the textile industry prosperity index in the third quarter remained in the contraction range, the market demand for textile and garment products was generally weaker than the same period last year, and data from the National Bureau of Statistics showed that the retail sales of clothing, shoes, hats, and textiles above designated size in the first three quarters decreased by 4.0% year-on-year, the recovery of terminal demand was slow, and the capacity utilization rate of the dyeing and finishing industry remained at a low level.
Operational quality remains basically stable. Production and sales coordination needs improvement.
According to data from the National Bureau of Statistics, from January to September 2022, the three-expense ratio of large-scale dyeing and finishing enterprises was 6.32%, a year-on-year decrease of 0.53 percentage points, of which cotton dyeing and finishing enterprises were 6.18% and chemical fiber dyeing and finishing enterprises were 7.21%; the finished product turnover rate was 16.96 times/year, a year-on-year slowdown of 4.18%; the accounts receivable turnover rate was 8.66 times/year, a year-on-year increase of 0.63%; and the total asset turnover rate was 1.02 times/year, a year-on-year increase of 0.59%. From January to September, the operating quality of the dyeing and finishing industry remained basically stable, the accounts receivable turnover rate and the total asset turnover rate achieved a slight increase, the finished product turnover rate decreased by 1.54 percentage points compared with the period from January to August, and the efficiency of production and sales coordination in the industry needs to be improved.
Profitability indicators remain under pressure. Enterprises face considerable operating pressure.
According to data from the National Bureau of Statistics, from January to September 2022, the operating income of large-scale dyeing and finishing enterprises was 229.639 billion yuan, a year-on-year increase of 8.07%, a decrease of 0.42 percentage points compared with the period from January to August; the total profit was 8.969 billion yuan, a year-on-year increase of 1.07%, an increase of 0.21 percentage points compared with the period from January to August; the cost-to-profit ratio was 4.16%, a year-on-year decrease of 0.29 percentage points; the sales profit margin was 3.91%, a year-on-year decrease of 0.27 percentage points, with the rate of decline narrowing slightly by 0.02 percentage points compared with the period from January to August; and the value of export deliveries was 29.868 billion yuan, a year-on-year increase of 3.99%. Among the 1,709 large-scale dyeing and finishing enterprises, 567 enterprises suffered losses, accounting for 33.18%; the total losses of loss-making enterprises were 2.446 billion yuan, a year-on-year increase of 60.20%.
In the first three quarters, affected by unexpected factors such as international instability, slowing global economic growth, and frequent sporadic domestic epidemics, the operating efficiency of the dyeing and finishing industry was significantly under pressure. The year-on-year growth rate of operating income decreased month by month, the growth rate of total profit fell sharply from the high growth in the first quarter, and the sales profit margin has shown negative growth for three consecutive months since July; the overall loss rate of the industry has narrowed, but the total losses of loss-making enterprises have increased significantly. The growth rate of the total losses of loss-making enterprises from January to September increased by 53.70 and 9.42 percentage points compared with the first quarter and the first half of the year respectively, reflecting the prominent profitability pressure on current dyeing and finishing enterprises, and some enterprises are facing considerable difficulties in production and operation.
Foreign trade maintains a good momentum. Export growth rate slightly slowed.
According to data from China Customs, in the first three quarters of 2022, the export volume of eight major categories of dyeing and finishing products was 22.529 billion meters, a year-on-year increase of 9.04%, with the growth rate falling by 1.02 percentage points compared with the period from January to August; the export value was US$23.9 billion, a year-on-year increase of 16.91%, with the growth rate falling by 1.40 percentage points compared with the period from January to August; and the average export unit price was US$1.06/meter, a year-on-year increase of 7.22%. In the first three quarters, China's exports of dyeing and finishing products generally maintained stable growth. Driven by rising raw material costs, the growth rate of export value was higher than the growth rate of export volume in the same period. Among the main export markets, Vietnam, Indonesia, and Bangladesh are the top three direct export destinations for China's eight major categories of dyeing and finishing products. In the first three quarters, China's exports to these three countries increased by 10.46%, 39.96%, and 15.56% year-on-year respectively, all higher than the overall growth rate of exports of eight major categories of dyeing and finishing products.
