Analysts told reporters that if the renminbi does not appreciate in the short term, the performance of textile and garment foreign trade companies is expected to grow rapidly.
Rising raw material prices, rising labor costs and the appreciation of the renminbi once became the three mountains of the textile and garment industry, and now, the renminbi in August 11 and August 12 two consecutive days have a thousand depreciation, which is regarded by textile and garment analysts as a signal of industry recovery.
Guo Fanli, research director of CIC Consulting, analyzed to reporters: "The impact of RMB depreciation on the textile and garment industry is mainly conducive to the development of textile and garment foreign trade enterprises, and will promote the growth of textile and garment export volume."
A weaker yuan could boost exports
Benefiting from the depreciation of the RMB, the trend of the textile and apparel sector is strong, such as Lutai A, Huafu color textile, Meibang clothing, Luo Lai home textile and other listed textile and apparel companies have risen by the daily limit.
"Export-oriented industries in the A-share market will benefit from the depreciation of the yuan. Among them, textile clothing, toys, shoes and hats are the biggest beneficiaries." Guo Fanli said.
The relevant person in charge of a listed company told reporters that the depreciation of the renminbi will benefit textile and garment enterprises with export business for a long time. But for companies with no export business, the impact is small.
Guo Fanli told the Securities Daily reporter that China's textile and garment industry is a typical export-oriented industry, and the depreciation of the renminbi has a greater role in the industry's recovery. The depreciation of the RMB will enhance the price advantage of textile and garment products exported, thus boosting the export volume. If the depreciation of the renminbi is no longer appreciated in the short term, the performance of textile and garment foreign trade companies is expected to grow rapidly.
For the depreciation of the yuan, some textile and garment industry analysts said that the company will benefit from the exchange. The depreciation of the RMB is equivalent to the increase of profit margins, the profit of textile and garment companies is more than a dozen points, and the low is two or three points, and the profit may increase by one point after the depreciation of the RMB.
Some analysts estimate that for every 1% depreciation of the renminbi, the sales profit margin of the textile and garment industry will rise by 2% to 6%. With the depreciation of the renminbi, the purchasing power of foreign currencies has increased correspondingly, which is also conducive to China's exports such as toys and clothing.
However, some textile and garment companies with export business said that the renminbi has just depreciated, and the company's orders have not changed much. Some companies also said that in the case of large changes in the exchange rate, foreign customers may wait and see for a while before placing orders.
In this regard, Meibang clothing told reporters that the depreciation of the renminbi will be good for textile and garment export enterprises for a long time.
Textile and garment exports recorded negative growth for the first time
In fact, in the first half of 2015, China's textile and apparel exports fell 2.91% year-on-year, showing negative year-on-year growth for the first time in recent years. Textile and garment exports or face a reshuffle crisis again.
Statistics show that in the first seven months of this year, China's textile and apparel cumulative exports of 155.62 billion US dollars, down 4.4% year-on-year. Among them, China's textile exports were 62.42 billion US dollars, down 1.5%; Apparel exports were $93.2 billion, down 6.2%.
In this regard, Yangtze Securities released a research report that in recent years, the continuous appreciation of the renminbi and weak external demand have put pressure on export-oriented textile and garment enterprises. On the one hand, in the case of continuous deterioration of the external economic environment, the sluggish external demand has dragged down the situation of China's export trade, since May 2010, China's export trade scale growth overall showed a downward trend. On the other hand, the continuous appreciation of RMB in recent years is another incentive for the deterioration of China's export trade situation. Under the influence of the above factors, the export-oriented textile industry is under pressure, the proportion of textile and garment exports in total exports has declined slightly, and the year-on-year growth rate of export delivery value has continued to decline.
China Textile Import and Export Chamber of Commerce revealed on August 10 that in the first half of this year, China's textile and apparel exports fell by about 2.9% year-on-year, the first time in recent years there was negative year-on-year growth. In July, China's textile and apparel exports again double-digit decline, the third quarter of the export situation is not optimistic.
It is reported that in the first month of the third quarter of this year, China's textile and apparel exports did not continue the trend of shrinking month by month in the second quarter, and there was a double-digit decline again. According to data released by the General Administration of Customs, in July this year, China's textile and apparel exports in the month of 27.25 billion U.S. dollars, down 10.2 percent year on year. Among them, China's textile exports were 9.51 billion US dollars, down 5.9%; Garment exports were $17.74 billion, down 12.4%.
In July, the decline in China's textile and apparel exports expanded again due to a high base in the same period last year on the one hand, on the other hand, because the internal and external environment of exports has not been significantly improved, and the national policy to promote imports and exports still needs time to be implemented.
The reporter found that when the RMB appreciated in the past few years, many companies converted their foreign export business to domestic sales. "Our company had export business in 2007, but then switched to domestic sales, and now the company has no export business." The relevant person in charge of a listed company told reporters.
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