Knitting Industry Association: Economic Operation Analysis Of Knitting Industry In The First Half Of The Year

Since this year, the national economy has continued to pick up and improve, the overall prosperity level of the industry has maintained expansion, and driven the steady growth of production. In the first half of the year, the supply and demand sides of the knitting industry continued to maintain a steady growth trend, the domestic market continued to recover, exports remained stable, the trend of enterprise economic efficiency improved, development confidence recovered, and the trend of stable and good economic operation was further consolidated.

01 YOY growth of main business income

According to the statistics of the National Bureau of Statistics, from January to June 2024, the main business income of enterprises above designated size in the knitting industry increased by 3.20% year on year, with a growth rate of 0.47 percentage points higher than that of the first quarter of this year, which has maintained the growth momentum of operation. The growth rate of operating costs of enterprises above designated size in the knitting industry was slightly lower than that of operating revenues, with a year-on-year growth rate of 3.05% from January to June. From the perspective of two categories of products, the growth rate of business income of enterprises above designated size for knitted fabrics increased by 4.51% year on year in the first half of the year, and the growth rate of business income of enterprises above designated size for knitted garments increased by 2.44% year on year. In addition, with the continuous innovation of the consumption scene, the consumption habit has changed to leisure and sports, and the performance of sports leisure knitted clothing is more prominent, with a year-on-year growth rate of 6.85%.

In terms of clothing production, in the first half of this year, China's clothing production increased by 4.42% year on year, of which the production of knitted clothing increased by 7.86% year on year. In the same period, the proportion of knitted clothing output in the total clothing output was close to 70%.

02 Continuous improvement of operation efficiency

According to the data in recent years, the profitability of enterprises above designated size in the knitting industry in the first half of this year maintained a normal level, with a profit margin of 3.96%; Among them, the profit margin of enterprises above designated size for knitted fabrics is 3.56%, and that of enterprises above designated size for knitted garments is 4.19%.

Specifically, from January to June, the total profit of enterprises above designated size in the knitting industry increased by 4.92% year on year; The industry's loss area was 26.08%, 6.6 percentage points lower than the first quarter of this year; The cost and three expenses in the operating income per 100 yuan decreased slightly compared with the same period in 2023, and the operating efficiency continued to improve.

03 Foreign trade continued to recover

According to the express from the General Administration of Customs, in the first half of this year, China's textile and clothing exports totaled US $143.18 billion, up 1.5% year on year. Among them, textile exports totaled US $69.35 billion, up 3.3% year on year; Clothing exports reached 73.83 billion US dollars, basically the same as the same period last year.

From January to June 2024, China's export of knitted products reached US $50.368 billion, a year-on-year increase of 4.45%, nearly 3 percentage points higher than the export of textiles and clothing. Among them, the export of knitted fabrics reached US $11.54 billion, up 8.2% year on year, 6.6 percentage points higher than that in the first quarter; The export of knitted clothing and accessories reached US $38.828 billion, up 3.4% year on year, 0.5 percentage point higher than that in the first quarter.

From the perspective of major export markets, China's knitting product exports continued to grow. In the first half of the year, China's knitting products increased by 8.62%, 6.07% and 2.39% year on year respectively to ASEAN, the United States and the European Union. In contrast, exports to Japan were slightly weak, with exports falling 2.52% year on year.

Over the same period, the export growth to the five Central Asian countries, Thailand, Bangladesh and other countries and regions along the Belt and Road is also obvious. From January to June, China's export of knitted products to these regions increased by 55.46%, 37.17% and 26.63% respectively. In the future, with the completion of the China Kyrgyzstan Uzbekistan Railway Project and the deepening of regional exchanges and cooperation, unprecedented development opportunities will be brought to countries along the line and even the whole region, driving the regional economic and social development to achieve faster.

From the perspective of market demand, since 2024, the overall import demand of knitting products from major developed economies such as the United States, the European Union and others has continued to decline. From January to May, the total imports of knitted products from the United States fell 3.85% year on year, of which the imports from China fell 0.7% year on year; From January to April, the total imports of knitting products from the EU fell by 6.76% year on year, of which the imports from China slightly increased by 0.68% year on year. From the perspective of market share, the share of China's knitting products in the European and American markets has slightly rebounded. From January to May, China's market share in the United States increased by 0.6 percentage points over the same period last year, and from January to April, China's market share in the European Union increased by 1.84 percentage points over the same period last year.

At present, China, Vietnam, Cambodia, Bangladesh and India are the top five countries of origin of US knitted products imports. From the data since 2013, China's market share in the United States has declined significantly, by 17 percentage points; At the same time, the proportion of Vietnam has increased by nearly 7 percentage points, further narrowing the gap with China.

In the EU region, more than half of the imports of knitted products come from China and Bangladesh. It is worth noting that from January to April this year, Bangladesh overtook China to become the largest knitting product supplier in the EU, with a market share of 0.35 percentage points ahead of China. In addition, due to the influence of entrepot trade, China's future exports to Japan or facing the squeeze from Vietnam and other countries deserve attention and attention.

From the perspective of category breakdown, the export volume of most knitted products in the first half of the year achieved positive growth. Among them, the export volume of T-shirts, tricot fabrics, underwear and home clothes (excluding bras) is relatively ideal, with growth rates of 34.10%, 9.75% and 9.07% respectively.

From the local customs data, Jiangsu, Zhejiang and other key eastern coastal areas have returned to the growth range this year, and the growth momentum is good. In the first half of the year, the export volume of Zhejiang, Jiangsu and Shandong increased by 6.85%, 8.40% and 3.47% respectively year on year. In the same period, the exports of Xinjiang and Guangxi showed a rapid growth trend.

04 Domestic sales maintained stable growth

According to the survey of the China Textile Industry Federation, the industry's comprehensive prosperity index reached 63.3% in the second quarter, and it has continued to occupy an expansion range of more than 50% since this year, indicating a steady growth of production. In the first half of the year, the retail sales of clothing, shoes and hats, knitwear and textiles above the designated size reached 709.8 billion yuan, up 1.3% year on year; The retail sales of physical goods online wearing goods increased by 7.0% year on year.

In June, China's manufacturing purchasing managers' index (PMI) was 49.5%, unchanged from the previous month, and the manufacturing landscape was basically stable. Among them, the production index was 50.6%, still higher than the critical point, and the production of manufacturing enterprises continued to expand; The index of new orders was 49.5%, and the demand of the manufacturing market slowed down.

Looking forward to the whole year, the development situation facing the knitting industry is still complex and severe. Affected by a series of factors such as the differentiation of global monetary policy, the tightening of geopolitical environment, and the rise of trade protectionism, the industry's foreign trade is still under pressure. In terms of domestic sales, although there are still some problems such as insufficient effective demand and weak market expectations in the short term, the fundamentals of domestic macroeconomic recovery and long-term improvement have not changed. The industry needs to deepen internal reform, strengthen innovation drive, flexibly adjust strategies, seize opportunities, promote the industry to move forward steadily in adversity and achieve high-quality development while coping with the complex and changing environment at home and abroad.