Recently, the first three quarterly performance reports of listed dyestuff companies have been released. Judging from the published reports, due to the impact of the pandemic, the operating income and net profit of most listed companies have declined significantly in the first three quarters.

Judging from the data in the first three quarters of the financial report, Zhejiang Longsheng Group Co., Ltd. (Lonsen) still continued its leading position in 2019, ranking first with operating income of 11.295 billion yuan and net profit of 3.16 billion yuan. However, compared with the same period last year, the company’s operating income and net profit fell by 32.05 percent and 18.61 percent respectively. Zhejiang Runtu Co., Ltd., ranked second in the industry, achieved revenue of 3.654 billion yuan in the first three quarters, down 28.46 percent year-on-year; net profit was 556 million yuan, down 48.33 percent year-on-year. Among them, the net profit in the third quarter was 181 million yuan, down 27.44 percent from the same period last year. Jihua Group’s financial report shows that from January to September, revenue was 1.306 billion yuan, a year-on-year decrease of 36.42 percent; net profit fell by more than 60 percent, a year-on-year decrease of 64.89 percent to 144 million yuan.

 

Many heads of dye companies told reporters that since this year, the impact of the pandemic has become the primary factor restricting the development of the industry, and the pandemic has had a profound impact on the supply and demand of the dye industry. Although the domestic pandemic has been effectively contained, companies have yet to see the turning point of foreign pandemic control and economic recovery.

 

When talking about the business, many companies’ leaders mentioned the company’s core competitiveness. Companies generally believe that the dye industry will accelerate its reshuffle in the post-pandemic period. Whether it has its own core products and technologies not only determines the level of corporate profits, but also the key to whether they can further improve and become stronger.

 

There is no doubt that dye companies are moving forward on the road of green and sustainable development. In addition, making the products distinctive and functional has become the main direction of the dye companies.

 

As for the industry trend, some industry experts predict that under the condition that the total international demand does not increase significantly, the production of the dye industry will maintain the current level, but the performance in different countries and regions will be different. The specific performance is as follows: the output of mature industrial development areas will slightly decline and continue to develop towards high-end products; the output of high-speed industrial development areas will continue to maintain a growth trend.

 

It is worth noting that the export situation of China’s eight major categories of dyeing and printing products has improved, which may bring certain support to the dye market. According to China’s customs statistics, from January to July, the total import and export value of China’s dyeing and printing products was USD 12.193 billion, a year-on-year decrease of 27.24 percent; the trade surplus was USD 10.864 billion, a year-on-year decrease of 26.32 percent. On a month-on-month basis, during the period, the decline in the export volume and export value of the eight major categories of dyeing and printing products narrowed by 2.15 and 2.10 percentage points, respectively. This is the second consecutive month that the decline in exports has narrowed, indicating that China’s dyeing and printing fabrics foreign trade market demand is gradually picking up.

 

In addition, China has introduced policies to promote economic development, such as reducing restrictions on the industry, lowering corporate taxes and fees, encouraging the expansion of export markets, etc., to promote the release of domestic demand; foreign countries, especially India, which has gradually increased production, dyes production capacity has been greatly affected by the pandemic, and the supply of production capacity has continued to tighten, which is a short-term positive factor for Chinese dye companies.