According to China Customs statistics, from January to November 2021, my country’s clothing (including clothing accessories, the same below) exports were US$159.27 billion, a year-on-year increase of 25.4%, an increase of 15.9% over the same period in 2019, and a new high for the same period since 2015. In the first three quarters of this year, my country’s clothing export growth rates were 47.4%, 35.7% and 9.6% respectively. Since the fourth quarter, the growth rate of clothing exports has picked up significantly compared with the third quarter. Exports in October were US$16.94 billion, a year-on-year increase of 25%, and exports in November were US$15.92 billion, a year-on-year increase of 23.6%.
01
Knitted clothing has a high contribution to export growth
Exports of woven garments rebounded rapidly
From January to November, knitted garment exports were US$68.11 billion, a year-on-year increase of 43.1%, an increase of 23.2% over the same period in 2019, and the export unit price increased by 8.7% year-on-year. About two-thirds of overall apparel export growth comes from knitted apparel. The export of woven garments was US$61.29 billion, a year-on-year increase of 12.1%, an increase of 6.1% over the same period in 2019, and the export unit price increased by 18.1% year-on-year. Since October, exports of woven garments have grown rapidly, with export growth exceeding 25% for two consecutive months.
From January to November, exports of medical protective clothing in the epidemic prevention category were US$7.12 billion, a year-on-year decrease of 55.7%, and medical gloves exports were US$9.8 billion, a year-on-year increase of 24.5%.
02
Exports to major markets maintain high growth
Exports to the U.S. slow down in November
From January to November, China’s apparel exports to the three major markets of the United States, the European Union, and Japan increased by 38.1%, 22.6%, and 8.5% respectively. Exports to countries along the “Belt and Road” increased by 28.6%. Exports to ASEAN, the Middle East, Africa, and Latin America increased by 28.6%. Exports increased by 26.3%, 27.6%, 35.3% and 48.7% respectively, and exports to South Korea, Australia and Canada increased by 23.9%, 30.6% and 11.7% respectively. Exports to the UK and Russia fell by 4.2% and 0.6% respectively. It is worth noting that, driven by strong consumption in the United States, one-third of my country’s apparel export growth in the first 11 months came from exports to the United States, but the growth rate of exports to the United States slowed sharply to 11.1% in November. Global export growth was 12.5 percentage points lower.
03
Guangdong’s exports rank first
Shandong and Fujian have faster growth rates
From January to November, Guangdong’s total apparel exports ranked first, with a year-on-year growth of 35.8%, higher than the national average growth rate. Zhejiang and Jiangsu grew by 21.9% and 15.6% respectively, which was lower than the national average growth rate. Shandong and Fujian grew by 35% and 43.8% respectively, higher than the national average growth rate. Among the provinces and cities in the central and western regions, Shanxi, Ningxia, Sichuan and Tibet all increased by more than 100%, while the exports of Hubei, Guangxi, Beijing, Henan, Chongqing and Gansu declined year-on-year.
04
U.S. apparel market retail sales hit record high
EU and Japanese markets recover slowly
U.S. apparel retail sales hit a new high in 2021, growing by more than 10% compared with before the epidemic. Clothing imports from January to October increased by about 6% compared with before the epidemic. However, it is expected that due to factors such as inflation, the fading impact of stimulus policies, and premature consumption, the U.S. market will have insufficient stamina for clothing consumption in 2022. In particular, clothing prices rose by 5% in November this year alone. The price increase will have a greater inhibitory effect on consumption, and the demand for clothing will increase. There is a high probability that it will be lower than in 2021, but it may still be higher than before the epidemic.
In 2021, EU consumption will recover slowly and has not yet returned to pre-epidemic levels. Since the third quarter of this year, the recovery has accelerated, returning to about 90% of pre-epidemic levels. The performance of clothing giants such as Inditex and H&M has exceeded that of the same period in 2019. From January to October, the EU’s imported clothing was still about 2% lower than before the epidemic, and it is expected to continue to return to 2019 in 2022.
The recovery of the Japanese consumer market has stagnated in 2021, and sales from January to October were only about 75% of the same period in 2019, even slightly lower than in 2020. Clothing imports from January to October were still 18% lower than the same period in 2019, and it is expected that the possibility of fully returning to pre-epidemic levels in 2022 is low.
05
Japan’s clothing industry is experiencing a “return to hometown trend”
Some production lines are planned to be moved back to the mainland
According to Japanese media reports, under the continued impact of the global supply chain crisis, Japanese apparel companies such as WORLD and TSI Holdings plan to transfer part of their production in China and Vietnam back to the country, and within 3-5 years, the proportion of local production will be reduced from the current level. 10%-20% increased to 30%-50%.
06
Cambodia’s garment production gradually recovers to
pre-epidemic level
During the severe period of the epidemic, the Cambodia Garment Chamber of Commerce and other chambers of commerce issued a joint statement stating that due to the impact of the new coronavirus pneumonia epidemic, about 400 garment and travel goods companies have suspended production, affecting about 150,000 workers. With the epidemic in Cambodia under control, as of now, the production of many garment factories has fully returned to pre-epidemic levels.
07
As the New Year approaches, sea freight rates rise again
As the New Year approaches, the Omicron mutant strain has caused the epidemic to continue to rebound, the recovery process of the supply chain has slowed down, and sea freight rates have continued to rise. In November, although China’s comprehensive export container freight rate index fell by 1.54% compared with October, the freight rate index for the West-U.S. route still increased by 0.27%. While market demand remains high and supply chain congestion has not been significantly alleviated, the average space utilization rate of US-line ships is close to the full load level, and high freight rates will continue.
08
Outlook
Judging from the situation next year, firstly, overseas orders are still sufficient in the first quarter and even the first half of the year; secondly, the impact of the Omicron virus is still difficult to judge, and it will still take time for overseas production capacity to recover and grab Chinese orders; thirdly, shipping bottlenecks are at least in the first half of the year It is still difficult to comprehensivelyTherefore, the practice of buyers placing orders in advance to prepare goods will continue; fourth, there is limited space for increasing domestic production capacity, and factors such as rising costs, labor shortages, energy supply, and domestic demand growth may have a cross-effect on China’s clothing exports.
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