As revenues drop, Chinese textile makers are leery of accepting new outside orders, fearing that the current surplus in demand would only last until the pandemic subsides and the international market shifts its orders back to neighbouring countries.
According to the most recent customs data, China’s apparel exports increased 17.9 percent from January to August compared to the same time last year, totaling CNY684.1 billion (USD105.8 billion).
Despite the fact that orders are pouring in, garment companies that rely on exports are struggling to turn a profit due to high international freight prices and rising production costs.
Clothing export growth is declining month by month, according to a member of the China Chamber of Commerce for Import and Export of Textiles. Garment factories are not boosting capacity, but rather speeding up production to satisfy requests, he added.
Meng Zhuo, manager of Anhui Garment Import Export, told Yicai Global that clothing companies are quite active this year. It is considerably more difficult to locate factories with sufficient idle capacity to handle additional export orders.
According to data issued by Shanghai Shipping, the Shanghai Containerized Freight Index rose 2.67 percent last week to a record 4,502.65 points, and has been rising for the last three months.