The export resilience of the Chinese filament weaving industry exceeded market expectations and achieved a good report card in 2022.

According to the data of China Customs, from January to October 2022, the cumulative export volume of China's chemical fiber filament fabric reached 18.119 billion meters, an increase of 15.65% compared with the same period in 2019, an increase of 28.42%. The average export price was $0.95 per meter, up 9% year on year and 6.74% from the same period in 2019.

Although the export of filament silk weaving industry has achieved year-on-year growth and the market heat has increased, it cannot be denied that the homogenization competition of the industry is still more serious. Industry experts said that in the future, the development focus of filament weaving industry needs to shift from the expansion of capacity scale to technological progress and upgrading, product development and innovation.

Market warming mo impulse

"The positive growth in foreign trade not only shows that the Chinese filament yarn weaving industry is a textile industry with international competitive advantages, but also shows that the international demand for chemical filament fabrics is still growing and has not been affected by international political and economic factors." Wang Jiayi, president of China Filament Silk Weaving Association, said that in 2022, China's filament silk weaving industry withstood the test and withstood the difficult time with tenacity and patience, and the development of the industry showed a steady trend of progress. From 2020 to 2022, the export of filament weaving industry has maintained steady growth.

In general, although due to the combination of high and volatile raw material prices, increased labor costs and other factors, the profitability of filament weaving industry in the past year is slightly insufficient, but a number of experts in the industry analysis, the industry bottoming may have been completed, the market will enter the market repair stage in 2023.

However, in the face of market recovery, China filament weaving Association related experts are not in favor of enterprise investment strategy from defense to offense.

"By the end of 2019, the number of looms in China's filament weaving industry reached 700,000 units, including 640,000 water-jet looms. In that year, China's output of chemical fiber filament fabrics reached 55 billion meters. By the end of 2021, the number of looms in China's filament weaving industry has reached 795,000, including 730,000 water-jet looms, with the output of filament fabrics reaching 55.7 billion meters that year. By comparing the two sets of data, it can be found that despite the influence of international political and economic instability, the scale of Chinese water-jet loom still increased by 6.8% annually, while the output only increased by 0.6% annually." Zhang Cheng, assistant president of the association, told China Textile News that production capacity has expanded significantly in recent years, but output growth has slowed down because the filament silk weaving industry has low investment, high efficiency and relatively low entry barriers. This also means that the industry is obviously not enough to open the possibility of new capacity can not be effectively released.

To this end, China Filament Weaving Association recently held the third session of the third Executive Board of special deliberation and adoption of the "Initiative on Avoiding Blind investment" (hereinafter referred to as the "Initiative"). According to the Initiative, the production capacity of filament silk weaving industry should not increase too fast and should be kept at a reasonable pace to keep pace with market demand.

It is hard to make money by expanding too fast

Once the "Initiative" was released, it triggered the attention and discussion of the industry.

"We've been saying for a few years now that industry demand is falling, but it's probably more than a lack of demand." Qian Xialan, head of Rudong Yilan Textile Co., said the industry was in trouble not simply because demand was depressed, but because market supply exceeded actual demand.

"The low threshold for engaging in filament weaving industry is the main reason for the blowout growth of textile enterprises in the past period." Zhou Zhengxu, general manager of Nantong Hengchang Textile Co., LTD., said that a few years ago, as long as the enterprise had certain financing ability, it could buy a dozen looms for five or six million yuan, and enter the industry on a small scale. "The equipment can be paid in installments, the technical requirements are not high, and they can easily get up and running."

Irrational investment is also the root cause of the industry's troubles. "From years of experience, as long as the market a little rebound, there will soon be companies to expand production." The head of Yongshang Textile Co., LTD., for example, said that in the second half of 2019, as downstream customers tried to develop new products to drive consumption, the increase of varieties led to the increase of grey fabric demand, and the market liquidity suddenly improved, resulting in about 2,000 new looms in the local area, but this boom period lasted only a few months.

If capacity increases too quickly, product prices will come under pressure. According to the business community monitoring data, since January 2023, Chinese polyester filament yarn market prices to maintain a small upward. Polyester POY rose 4.35 percent, polyester FDY 3.5 percent and polyester DTY 2.92 percent.

However, although the price of textile raw materials ushered in a "red start", but the fabric price has not improved. A head of a filament weaving company in Shengze, Jiangsu province, who asked not to be named, said his factory was already receiving orders, but his mood was not very sunny.

"We probably received more than 1 million meters of fabric orders after the Lantern Festival, the average price is 3 yuan/meter to 4 yuan/meter, the profit is very thin, to run the volume, the average machine benefit is only 50 yuan/day. Now the price of grey cloth can not rise, the market price is generally low, although there are rumors of price increases, but the real price increases are few." "If the market only needs 10 million meters of fabric, but there are 11 million meters in circulation, we can't think that only the 1 million meters of cloth will be affected, and the other 10 million meters will not be sold at a good price," the official said.

According to the inventory days of sample enterprises monitored by China Jindu network, it can be seen that the inventory days of local weaving enterprises are still in a high running state of 35.5 days.

Do not follow the old path of innovation

Turn inward and examine yourself when you encounter difficulties in life

"This year's market has proved once again that ordinary, low-grade products are facing more competition than ever before, and when companies start to fight over prices and keep production and workers, they are put on the back foot and have an adverse impact on the industry." Zhang pointed out that in the case of oversupply in the market, if we do not take the initiative to adjust the relationship between supply and demand, and only rely on "cost reduction and efficiency", it is easy for enterprises to enter the dilemma of cost reduction, price reduction and loss.

Faced with this situation, many enterprises have shifted their focus from capacity expansion to technological progress and product and innovation.

"If you keep going your way, you may be eliminated by the market. While seeking stability, enterprises also need to innovate. If there are no new varieties, these conventional products will have no profit point, and will be eliminated by customers at any time." Qian Xialan said that the company will not follow the trend of production when the market is good, so that when the market is not ideal, the company can maintain stable development, with high quality products, innovative thinking for customer service.

"Companies must make product innovation a top priority. At present, mass production of road goods is absolutely impossible. Enterprises should actively focus on product innovation, take the initiative to promote equipment upgrading and technological transformation, and realize the effective enhancement of core competitiveness and the overall upgrading and transformation of the industry." Zhang said.

Wang Jiayi affirmed the performance of long silk weaving enterprises in product innovation and technological progress in the past year. He said that as of December 2022, there are 43 national standards in the silk weaving industry, among which 37 are product standards, accounting for 85 percent of the total.

Despite the achievements, Wang Jiayi stressed that there is no end to product innovation and high-quality development of the industry has a long way to go. Future enterprise's new product development should also pay attention to the following aspects: develop accurate and clear product positioning and brand positioning; Timely extend the construction of enterprise internal industry chain; Continue to promote the development of high quality interleaved materials; Increase the development of industrial textiles; We will increase research and development of green and low-carbon products.

"At present and in the foreseeable future, technological innovation will continue to play a pivotal role in the transformation and upgrading of the industry. Good filament fabric is definitely not a result of weaving, but the improvement and investment of the whole industry chain from raw material production to terminal consumption. We hope that all enterprises can take the initiative in product research and development, and seek a better future for China's filament weaving industry in the international competition." Wang Jiayi said.