Investment keeps enlarging thanks to the national favorable spurring programs. Yarns and fabrics output have seen slight upswing. Exportation market remains recessed. Domestic raw material price surges up leading to small magnitude of price increase. Profit margin turned positive.

1.Investment keeps enlarging thanks to national spurring polices

The first eight months of 2009 has seen fixed asset investment amount to 49.8 billion RMB which increased by 6.76% increasing amplitude climbed up 11.16% in contrast with the corresponding period of 2008. New programs launching is also accelerating, increased by a striking 23.03% year-on-year due to the fact that investment confidence of 2008 has been severely weakened by the economy recession leading to shrunk new programs launching.

Geographically speaking, middle and west provinces have seen an ever-expanding investment growth. Overall aggregate investment of the east has descended to 59.32% of the overall national investment.

Provincially, aggregate investment of Hebei province has increased 52% year-on-year while conventional textile-pillared provinces namely Shandong and Guangdong have both seen investment drop by 17% and 24%. Hubei province is the only midland province that has seen aggregate investment decline. Other midland provinces, although a minor degree, all have seen investment growth. Henan, one of the highlighted provinces has seen aggregate investment increasing magnitude decline.

Fig.1 China domestic provincial investment contras

2.Yarn output growing magnitude slowed down Fabric output remains stable

Statistics unveiled by National Statistics Bureau indicated that the first eight months of 2009 has seen yarn output 15.1 million tons and fabric output 35.5 billion meters, respectively increased by 9.75% and 1.1%. As can be concluded from Fig.2 that both of yarn and fabric output are steadily increasing year by year since after February. Up until August this year, the output of yarns has recovered to approximately the same level to that of last year while fabric output has barely increased too much.

Fig.2 Annual output increase of yarn and fabric schematic diagram

Fig.3 is the schematic diagram reflecting the annual yarn output increase of the top six provinces. The diagram indicated that the yarn output of each province is steadily recovering after major fluctuation of the first half year. All provinces excluding Hubei have seen yarn output increasing magnitude 1% to 2% elevation which is the fundamental reason why national yarn output remains steady increase.

Fig.3 Fabric output of the top six provinces from January to August

Fig.4 is the schematic diagram reflecting the annual fabric output increase of the top six provinces. Only Guangdong and Zhejiang province have seen slight increase compared with last month. Other provinces including Shandong, Jiangsu, Hubei as well as Hebei province all seemed to lack propulsion to move ahead.

3.Exportation of cotton textile products keeps declining. No positive sign of rebounding.

Exportation of cotton textiles as well as cotton-made garments has amounted to $40 billion dollars, down by 14.79% , in which cotton textiles reached up to $11.3 billion dollars, down by 19% and cotton-made garments reached up to $28.7 billion dollars, down by 13%.

Fig.5 is the schematic diagram reflecting the annual cotton textiles and cotton-made garments accumulated exportation increase. It is rather obvious that the exportation growth keeps declining since after the beginning of 2008, although the overall exportation quantity remains increasing. Ever since 2009, exportation of both cotton textiles and cotton-made garments remains negative growth and slumping down month after month. Up until August, no positive sign of rebounding is indicated.

Statistics unveiled by the General Administration of Customs indicated that accumulated exportation of cotton yarn amounted to 353,100 tons during a time period from January to August, which has declined by 13.81% year-on-year. Meanwhile, exportation of cotton textiles amounted to 3.949 billion meters, down by 10.61%. As can be concluded from Fig.6, only cotton blended fabrics with lower price indicated fairly large export increase. Cotton blended denims also showed recovering momentum. Other products, however, still remains negative growth with unfavorable exporting price.

Exportation of cotton textiles from January to August
Unit: Million dollars
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