China’s total profits of cotton textile enterprises increased 93.8 percent Y-o-Y in the first five months

According to the data of key enterprises and indus—trial clusters tracked by China Cotton Textile Association(CCTA), the production and operation of cotton textile enterprises in May 2021 declined compared with that in April. The growth rate of main economic indicators in the first five months continued to slow down, and the situ—ation of key enterprises tracked was better than that of industrial clusters.

The growth rate of main business income continues to slow down, and the proportion of costs continues to decline

Tracking data shows that the main business income of cotton textile enterprises in the first five months of 2021 has increased by 25.1 percent year—on—year, and the growth rate has slowed by 2.4 percentage points compared with the previous four months.

In the first five months, the cost of main business of cotton textile enterprises increased by 22.7 percent year—on—year, and the growth rate was down by 5.7 per—centage points compared with the previous four months,and the growth rate was smaller than that of main busi—ness income, and corporate profits were restored; main business cost accounted for 89.4 percent of main busi—ness revenue, a decrease of 1.9 percentage points from the previous four months. In the first five months, the main business income of cluster enterprises increased by 16.0 percent year—on—year, and the growth rate was 2.5 percentage points lower than the previous four months; the cumulative cost of main business increased by 19.0 percent year—on—year, and the growth rate was 3.1 percentage points lower than the previous four months. The growth rate of operating costs is higher than that of main business income, and the production and operation pressure of cluster enterprises is relatively high.

Orders increased, and the export delivery value increased significantly year-on-year

Tracking data shows that in the first five months of 2021, the export delivery value of cotton textile en—terprises increased by 8.0 percent year—on—year, an increase of 7.5 percentage points from the previous four months; the export delivery value accounted for 13.3 percent of the industrial sales output value, down 0.3 percentage points from the previous four months.The global economy continues to recover, and corporate export orders have increased year—on—year, while the potential of the domestic demand market continues to be released.

In the first five months, the export delivery value of cluster enterprises increased by 10.2 percent year—on—year, and the export delivery value accounted for 5.7 percent of the industrial sales output value, a decrease of 3.3 percentage points from the previous four months.The industrial clusters are dominated by small and medium—sized enterprises, with relatively few product exports. Affected by the pandemic, cluster enterprises actively adjust product structure, reduce exports and increase domestic sales.

Industrial value-added increased year-onyear, and the percentage of loss-making enterprises continued to narrow

Tracking data shows that in the first five months of 2021, the industrial value—added of cotton textile enter—prises increased by 11.3 percent year—on—year, and the growth rate increased by 2.8 percentage points over the previous four months; the industrial value—added rate was 16.7 percent, an increase of 0.2 percentage points over the previous four months.

The total profit of cotton textile enterprises in the first five months increased by 93.8 percent year—on—year, and the growth rate slowed by 32.7 percentage points compared with the previous four months; the profit margin increased by 1.5 percent year—on—year,and the growth rate narrowed by 0.3 percentage points compared with the previous four months.

In the first five months, the number of loss—making enterprises in the cotton textile industry fell by 66.4 percent year—on—year, an increase of 4.1 percentage points from the previous four months; the percentage of loss—making enterprises was 16.0 percent, a year—on—year decrease of 31.5 percent, which was 1.6 percentage points less than the previous four months.

In the first five months, the industrial value—added of cluster enterprises increased by 18.3 percent year—on—year, and the growth rate was 0.5 percentage points higher than the previous four months; the total profit increased by 25.9 percent year—on—year, and the growth rate was 7.5 percentage points lower than the previous four months, and the growth rate was smaller than that of the tracking key enterprises.

In general, the operation of tracking companies remained stable in May. However, according to the data from the National Bureau of Statistics, the purchase price of textile raw materials in May increased by 4.2 percent year—on—year, and the ex—factory prices of textiles apparel fell by 0.3 percent year—on—year. The weak terminal consumption and the rising cost formed a sharp contrast. Meanwhile, with the arrival of the indus—try’s off—season, business orders have shrunk and pres—sure on production and operation has increased.

The data in this report comes from the China Cotton Textile Association, involving more than 260 cotton tex—tile enterprises and about 15 industrial clusters across the country. The total spinning capacity accounts for about 60 percent of the national cotton textile industry,which is representative of the industry.