In May, crude oil bottomed out, the cost end of chemical fiber was obviously supported. The decline in some indicators of the operation of the chemical fiber industry was narrower than that from January to April, but the terminal demand recovery was lower than expected. The global pandemic situation has not shown any signs of improvement, and the situation of chemical fiber industry is still grim.

Domestic demand for textile and apparel is weak, and exports are blocked, but the decline has narrowed. In terms of domestic demand, according to data from the National Bureau of Statistics, the retail sales of apparel, shoes, hats and knitted textiles in units above designated size in the country from January to May fell by 23.5% year-on-year, a decrease of 26.1 percentage points from the same period last year, and the decline was narrowed by 5.5 percentage point from January to April; retail sales of online wearables decreased by 6.8% year-on-year, a decrease of 28.0 percentage points from the same period last year, the decrease was 5.2 percentage points narrower than that from January to April. In the textile and apparel industry’s demand for chemical fiber products, in addition to the nonwoven output increasing by 2.46% year-on-year, the output of cotton blended yarn, chemical fiber yarn, cotton blended fabric, chemical fiber staple fiber, and cord fabric all decreased year-on-year 29.96%, 11.84%, 43.34%, 12.05%, 10.44%, the decline of most products narrowed slightly from January to April. In terms of external demand, according to Chinese customs data, China’s textile and apparel exports amounted to USD 100.62 billion from January to May, a year-on-year decrease of 2.3%, and the decline continued to narrow by 8.2 percentage points from January to April, and the decrease rate was increased by 0.4 percentage points from the same period last year.

 

The decline in chemical fiber output continued to narrow. According to data from the National Bureau of Statistics, China’s chemical fiber output was 22.94 million tons from January to May, a year-on-year decrease of 3.16%, and the decline rate continued to narrow by 1.81 percentage points compared with January to April. Among them, the output of viscose staple fiber was 1.1488 million tons, a year-on-year decrease of 34.34%, the decrease is 4.84 percentage points deeper than that from January to April; polyester production was 18.1452 million tons, a decrease of 2.30% year-on-year; spandex production was 316,900 tons, a decrease of 0.49% year-on-year, which did not continue the growth trend from January to April; nylon output was 1.6361 million tons, an increase of 1.30% year-on-year, reversing the decline from January to April.

 

The international trade situation is grim, and the decline in chemical fiber imports and exports continues to deepen. According to Chinese customs data, China imported 313,700 tons of chemical fiber from January to May, a year-on-year decrease of 17.19%, a decrease of 2.32 percentage points deeper than that from January to April, and the imports of major products all showed varying degrees of reduction. In terms of exports, due to the overseas pandemic situation, the export volume of chemical fiber fell. From January to May, the export volume was 1.6661 million tons, a year-on-year decrease of 16.90%, and the decline was 9.2 percentage points deeper than that from January to April. Among them, polyester staple fiber exports fell by more than 30%, polyester filament exports decreased by 13.31%, nylon filament exports decreased by 16.42%, viscose filament exports decreased by 24.37%, viscose staple exports decreased by 17.07%; market demand of spandex mask ear tape has declined, and the export volume changed from January to April growth to a 6.17% year-on-year decrease from January to May.

 

The economic efficiency of the industry has dropped significantly, and the rate of decrease has been narrowed month-on-month. According to data from the National Bureau of Statistics, the operating income of enterprises above designated size in the chemical fiber industry from January to May was 286.292 billion yuan, a year-on-year decrease of 17.97%, a decrease of 1.99 percentage points from January to April; the total profit was 4.097 billion yuan, a significant decrease of 59.13% year-on-year, the decline rate was narrowed by 1.31 percentage points from January to April, in which the polyester and nylon industries decreased by 90.40% and 7.72% year-on-year respectively. The operating income margin was only 1.43%, a decrease of 1.63 percentage points from the same period last year. The percentage of loss-making enterprises was 42.25%, an increase of 16.2 percentage points from the same period last year, and the loss of loss-making enterprises increased by 100.15% year-on-year.

 

Investment confidence is insufficient, and fixed asset investment has shrunk substantially year-on-year. From January to May, the fixed-asset investment in the chemical fiber industry decreased by 23.2% year-on-year, a decrease of 9.6 percentage points from the same period last year and 7.0 percentage points from January to April, reflecting the lack of investment confidence of enterprises, but some key enterprises in the industry are still steadily promote the construction of new projects.

 

(Source: China Chemical Fibers Association)