Frbiz Analyzes China's 2010 Textile and Apparel Industry Situation

BEIJING, Aug. 2 /PRNewswire-Asia/ -- Frbiz.com, one of China's leading B2B search platforms, analyzes China's 2010 textile and apparel industry situation.

The gradual recovery of the global economy and the simultaneous instatement of national policies supporting the textile and garment industry have seen China's clothing exports on a steady rise, but the textile and apparel industry is still facing the following problems:

First, profit margins of textile companies are compressed. Since 2009, domestic conditions for the cotton yarn market have improved in China and domestic cotton has been on the rebound with prices continuing to rise. However, external demand remains weak, with raw material prices rising and the terminal market price dropping, forming a strong contrast to the domestic market. Corporate profit margins are shrinking more and more. Meanwhile, with the domestic economy picking up, the Renminbi in 2010 is on the rise again, which should further reduce corporate profits.

Second, international trade protectionism is seriously affecting the industry. After the outbreak of the financial crisis, national governments looked to protect their own industries through improving safety, health, environmental standards and take anti-dumping. Anti-subsidies and so on build barriers to trade. Trade friction for China's textile and apparel exports is becoming more serious. In 2009, under the framework of WTO trade remedies, multiple clothing and apparel products from China were recalled from countries including the United States, Canada, Hungary, Turkey, and others.

Third, carbon emission targets have put restrictions on Chinese textile exporters. With the global climate conference in Copenhagen, Denmark, and the mounting concern about creating a low carbon economy, China has created more stringent regulations on emissions and energy consumption levels. In the textile and garment industry and the printing industry companies will be under some of the highest pressure to comply with new regulations. Meanwhile, major developing countries are now engaging in the carbon trading market, while, China is at the bottom of the whole carbon trading industry chain. Technical standards present in developed countries have long been limited China's textile exports, while carbon dioxide emission targets may become another excuse for limiting China's textile exports.

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