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The wool industry is still struggling in April

After experiencing the impact of the domestic epidemic, the spread of the overseas epidemic became the main obstacle for the wool industry to resume production in March to April. Combined with various data and research, the impact of textile and clothing consumption in this crisis is greater, and compared with the average level of textile industry, the impact of wool industry and wool enterprises is deeper.

1、 Yarn / knitted products recovery faster than fabric / woven clothing products

3. In April, the production of wool yarn in Enterprises above Designated Size showed a recovery trend, and the monthly production of wool yarn increased by 11% month on month in April. The year-on-year decline in April's output narrowed by 6 percentage points compared with March, and 28 percentage points compared with January to February. From January to April, the cumulative production of wool yarn fell by 16% year on year, with a drop back of 9%.

However, in the same period, the production of wool fabrics did not recover, and the monthly production continued to decline. In April, the monthly production of wool fabrics of Enterprises above the designated size fell 5% month on month. From January to April, the cumulative output of wool fabric fell by 25% year on year, and the decline was further deepened.

The production of wool yarn is mainly used in knitted clothing, and wool fabric is the intermediate product of woven clothing. From the situation of these two kinds of products, the recovery of wool knitted clothing market is faster than that of woven clothing market.

2、 The recovery speed of textile and clothing products consumption is slower than that of social consumption

Since the outbreak of the epidemic, domestic sales of textile and clothing products have declined significantly. According to the data of the National Bureau of statistics, in the first quarter, the per capita clothing expenditure of the whole country was 369 yuan, down 17.8% year on year, accounting for 7.3% of the per capita consumption expenditure, down 0.8% year on year. From January to April, the retail sales of clothing, shoes, hats and knitted fabrics of units above designated size decreased by 29.0% year on year, 3.2 percentage points lower than that of January to March. In order to make up for the loss of a large number of offline stores closed, textile enterprises generally strengthen the construction of online channels. From January to April, the retail sales of online wear goods decreased by 12.0% year on year, 3.1 percentage points lower than that from January to March. Since this year, group purchasing of woolen products has been generally postponed for more than three months.

3、 From March to April, the overseas epidemic spread, and the export of wool products further declined

According to the data of the customs from January to April, the total export volume of wool textile raw materials and products is 2.2 billion US dollars, down 27.7% year-on-year. The year-on-year decline continues to expand compared with the period of the most serious domestic epidemic situation in January to February. As predicted and analyzed last time, the stagnation of the international market has hit the recovery of the industry even more. Among them, the export volume of all kinds of wool products fell by 34% year on year, and that of all kinds of cashmere products fell by 25%, both of which showed a further expansion compared with the decline from January to February.

From the upstream and downstream of the industrial chain, the impact of the final product export is more than that of the intermediate product. From January to April, the export volume of wool knitted clothing, wool woven clothing and blankets fell 34%, 35% and 26% respectively year on year, but the export price was relatively stable. Over the same period, the export volume of wool sliver and wool yarn fell by 6% and 15% respectively year on year, but the export price fell rapidly, by 27% and 16% respectively year on year. Artificial fur fell 17% year-on-year, but the export price increased rapidly. The export of wool fabrics also declined rapidly, with a year-on-year drop of 35%.

From the point of view of export areas, the main consumption markets of wool textile continue to decline. Affected by the epidemic situation in the EU and the US, China's export of wool textile products continued to accelerate the decline, down 34% and 36% year-on-year respectively, both higher than the average decline level. Other major export markets in Asia showed a narrow decline, with ASEAN, Japan, Hong Kong, China and South Korea down 24%, 20%, 37% and 20% respectively year-on-year.

4、 The operation quality and efficiency of wool industry is significantly lower than the average level of textile industry, and wool enterprises are facing greater pressure

From January to April, 436 of the 880 or above wool textile and dyeing and finishing enterprises showed losses, with a loss area of 47%, down from January to February, but still 14 percentage points higher than the average level of the textile industry in the same period. From January to April, the total operating revenue was 31.7 billion yuan, down 26.7% year on year, 7 percentage points higher than the average level of the textile industry. The average profit margin of the industry is 2%, 1.5% lower than the average level of the textile industry. Obviously, the production and management of wool textile enterprises is more difficult. The industrial benefit index level is basically the same as the judgment of enterprises in the first quarter return to work survey, and the data from March to April is not significantly better than the data from January to February.

5、 The consumption of raw materials has recovered

From January to April, the import volume of wool was 79000 tons, down 23% year on year, and the import unit price fell 12% year on year. Most of the import volume of major wool producing countries showed a decline, among which, Australia, New Zealand, Uruguay and the United Kingdom imported wool fell by 22%, 34%, 41% and 27% respectively. Only South Africa's import of foot-and-mouth disease stagnated in the same period of 2019, resulting in a year-on-year growth of imported wool, with an increase of 58%. In terms of cashmere raw materials, since April, cashmere market transactions have increased, and the low price of cashmere has also increased slightly. On the whole, the consumption of wool textile raw materials has recovered to a certain extent compared with that in January to February, when the epidemic situation is the most serious in China.

At the market information forum of the 89th International Wool Textile Conference (online teleconference) on May 20, Peng Yanli, President of China Wool Textile Industry Association, made a speech entitled "post new crown epidemic period, the current situation and future of China's wool textile industry", reviewing the situation of China and China's wool textile industry responding to the new crown epidemic since this year. As the speech said, for wool textile enterprises, it may be the most difficult stage in the 20th century, and this stage will continue.