In the first half year, the score of textiles industry in Taizhou City of Jiangsu Province is quite satisfied. According to data provided by customs, from January to June, the export value of textiles in Taizhou is increased by 15.2% from the same period of last year that is 0.17 billion US dollar, which is accounted for 18.4% of total export value of Taizhou, the textiles industry became the second largest export industry after the electromechanical industry. Among which, the mills with export value of 10 million US dollars is only 1, with 5 million US dollars are 6, and with 1 million US dollars are 52.
However, the potential worries are hidden behind the good score of textiles export. According to the data declared by the Operation Section of Taizhou Economy and Trade Commission, when RMB has appreciated 1%, the profit rate of textiles industry will reduce 2% and 6%. And there are 70% mills in Taizhou City completely depending on export, and those are all labor concentrated middle and low-level mills. Since the attached value of products are low, the profit of the industry can only keep at around 5%, from the theory, under the pressure of RMB appreciation, the profit of the entire industry will reduce to the lowest.
Before RMB exchange rate is adjusted, the profit of exporting 1 meter cloth is 0.4-0.5 RMB, but now, the drawback for export duties paid is reduced from 15% to 13%, plus the factors of petroleum price-up and cost rise for raw materials and labors, the original profit space has already been eliminated. Therefore, if the business relying on low prices is continued, the enterprises are sure to be more and more difficult. Mr. Zhao Dongsheng BOD chairman from Taizhou Yifeng Textiles Co. Ltd. said so.
A person in charge from the Operation Section of Taizhou Economy and Trade Commission has analyzed that RMB appreciation brings great impaction to mills in short period, but from long term, when the market has eliminated some enterprises that can not adapt to the status development, those enterprises, which have to adjust the thoughts because of survival, begin to give up high energy consumption extensive managing mode, and turn to developing and producing high, precise and advanced products. From this point, this is also an opportunity for optimizing the export structure of textile products and improve the strength of entire textiles industry.
However, the potential worries are hidden behind the good score of textiles export. According to the data declared by the Operation Section of Taizhou Economy and Trade Commission, when RMB has appreciated 1%, the profit rate of textiles industry will reduce 2% and 6%. And there are 70% mills in Taizhou City completely depending on export, and those are all labor concentrated middle and low-level mills. Since the attached value of products are low, the profit of the industry can only keep at around 5%, from the theory, under the pressure of RMB appreciation, the profit of the entire industry will reduce to the lowest.
Before RMB exchange rate is adjusted, the profit of exporting 1 meter cloth is 0.4-0.5 RMB, but now, the drawback for export duties paid is reduced from 15% to 13%, plus the factors of petroleum price-up and cost rise for raw materials and labors, the original profit space has already been eliminated. Therefore, if the business relying on low prices is continued, the enterprises are sure to be more and more difficult. Mr. Zhao Dongsheng BOD chairman from Taizhou Yifeng Textiles Co. Ltd. said so.
A person in charge from the Operation Section of Taizhou Economy and Trade Commission has analyzed that RMB appreciation brings great impaction to mills in short period, but from long term, when the market has eliminated some enterprises that can not adapt to the status development, those enterprises, which have to adjust the thoughts because of survival, begin to give up high energy consumption extensive managing mode, and turn to developing and producing high, precise and advanced products. From this point, this is also an opportunity for optimizing the export structure of textile products and improve the strength of entire textiles industry.
