The global economic growth rate continued to slow in 2023, and developed countries such as Europe and the United States contracted significantly in demand under the influence of factors such as continued interest rate hikes, high inflation and financial system turbulence. China's economy in the domestic epidemic prevention and control of faster and smooth conversion, production and life order to speed up the recovery, expand domestic demand and other leading policies such as a significant force, supported by the indicators are significantly improved and rebound, a variety of positive factors are accumulating. However, in the face of a more complex and severe international environment and situation, downstream investment is still cautious, consumer confidence is generally insufficient, the improvement of market demand is weak, the development of China's industrial sewing machine industry is still under pressure.
Heavy Duty Industrial Sewing Machine Manufacturer - KINGMAX (kingmaxsew.com)
1. Overall decline in production
The first quarter of 2023 was affected by sluggish internal and external demand and inventory clearance, and the industry as a whole showed a tightening trend in production. According to the association's statistics of 100 complete machine manufacturers, the industrial output value of 100 enterprises in the industry in the first quarter was 4.2 billion yuan, down 11.8% year-on-year; sewing equipment output was 1.36 million units, down 27.06% year-on-year, including industrial sewing machine output of 950,000 units, down 19.73% year-on-year, except for some embroidery, cutting equipment slightly increased, the production of other products across the board negative growth. The number of employees in enterprises fell by 9.54% year-on-year.
In January, affected by the full liberalization of the epidemic control, the output of industrial sewing machines of 100 enterprises in the industry was less than 200,000 units, down 58.78% year-on-year, which was the lowest value in recent years. In March, with the full-scale resumption of production, the release of accumulated order demand and the gradual recovery of the local regional domestic and foreign trade market, the industry output continued to pick up, and the output of industrial sewing machines of 100 enterprises in the industry in March was 420,000 units, down 11.44% year-on-year and up 22.24% sequentially.
From the perspective of industry inventory, the effect of reducing inventory in the first quarter was remarkable. The inventory of finished goods of 292 enterprises in the industry dropped 13.60% year-on-year, and the total inventory of 100 complete machine manufacturers in the industry was about 880,000 units, down 31.34% year-on-year. Among them, industrial sewing machine inventory for eight consecutive months of negative year-on-year growth, from July 2022 on millions of units of inventory successively down to 620,000 units at the end of the first quarter, down 44.19% year-on-year.
Figure1 Industrial sewing machine monthly production of the industry's 100 complete machine manufacturers in the past three years
(Source: China Sewing Machinery Association)
2.Economy gradually rebounded
In the first quarter of 2023, the domestic sales of China's sewing machinery industry continued to be weak due to shrinking overseas orders, liberalization of epidemic prevention and control, downward spiral of garment production, and sluggish domestic demand market, with no obvious peak season and rebound. According to the National Bureau of Statistics, the garment production of enterprises above the scale in the first quarter fell by 9.7% year-on-year, and the investment in fixed assets fell by 3.3% year-on-year; according to preliminary statistical calculations, the domestic sales of Chinese sewing equipment in the first quarter fell by about 20-30% year-on-year. According to the latest customs data, the cumulative imports of Chinese sewing machinery products in the first quarter amounted to $216 million, down 16.71% year-on-year, which also fully reflected the relatively sluggish conditions of the domestic market.
From the monthly situation, the industry's domestic market improvement and weak recovery trend gradually emerged, domestic sales are expected to bottom out and usher in a recovery of growth. According to the Association's statistics of 100 complete machine manufacturers, January-February industry 100 enterprises domestic sales value fell 13.69% year-on-year, January-March industry 100 enterprises domestic sales value fell 4.01% year-on-year, the month of March domestic sales value rose 6.08% year-on-year, March China sewing machinery products imports of $ 89.84 million, down 8.57% year-on-year, an increase of 76.24%. Showing a significant narrowing of domestic sales decline and demand continued to improve the positive momentum.
From the country and the downstream textile and apparel, the first quarter of the national "stable growth" series of policies continue to show the effect of force, China's economic growth rebounded significantly, investment, consumer demand gradually released. According to the National Bureau of Statistics data, the first quarter of China's retail sales of clothing, footwear, headgear, needles and textiles above the quota increased by 9.0% year-on-year, of which the retail sales of clothing increased by 11.4% year-on-year. March China's apparel exports rebounded, up 32.3%. With the improvement and growth of downstream demand, the industry's domestic sales demand is expected to gradually open up and achieve a recovery.
Figure 2 The amount of sewing machinery products imported into the industry in the last three years
(Source: General Administration of Customs)
3,The overall decline in exports
In 2023, the main international markets such as Europe and the United States footwear inventory high, in high inflation, high interest rates, inventory reduction and other factors added, downstream consumption will decline, Southeast Asia and other countries clothing orders shrink significantly, footwear exports fell rapidly, the demand for sewing equipment significantly reduced. According to relevant data: January-March U.S. total apparel imports fell 19.7% year-on-year; January-February EU total apparel imports fell 11.5% year-on-year; January-February, India's apparel exports fell 8% year-on-year, Indonesia's exports fell 22.7% year-on-year; January-March Vietnam's textile and apparel exports fell 18.63% year-on-year.
According to the national customs data statistics, the first quarter of China's sewing machinery products accumulated exports of $ 718 million, down 11.65% year-on-year, the average monthly export value fell to nearly $ 240 million, back to the level of early 2021. From the perspective of monthly export data, since November 2022, China's sewing machinery industry monthly exports continued to show negative growth year-on-year. January industry exports of $ 283 million, down 17.29% year-on-year, up 17.57%; then in February, due to the Spring Festival holiday and the impact of factors such as the epidemic, industry exports fell sharply, monthly exports of only $ 147 million, down 22.83% year-on-year. In March, driven by India, Turkey, Russia, Brazil and Central Asia, West Asia and other local market demand rebound, the industry's exports rose significantly to $286 million, up 3.01% year-on-year and 94.69% year-on-year.
From the point of view of export key regional markets, in the first quarter, China's exports to Asia, Latin America, the two major markets have shown a decline, while exports to Africa, Europe, North America, Oceania markets are growing year-on-year. Specifically by country, China's sewing machinery exports 188 countries and regions in the first quarter, more than half of the market exports year-on-year growth, the top 20 export markets, nine markets showed year-on-year growth in exports, including an increase of more than 50% of the four regions, respectively, Turkey, the Russian Federation and Central Asia, Uzbekistan, Kyrgyzstan, the growth rate of 53.51%, 79.01%, 112.93%, 96.36%. India is still China's largest sewing equipment export market. China's total export of sewing machinery products to India in the first quarter was $97.16 million, up 6.31% year-on-year, accounting for 13.52% of China's industry exports. In addition, China's exports to Turkey, Russia, Brazil, Mexico and other Latin American markets, Uzbekistan, Kyrgyzstan and other Central Asian markets in the first quarter showed significant year-on-year growth, while exports to Vietnam, the United States, Bangladesh, Indonesia, Japan, Singapore and other traditional regional markets showed varying degrees of decline.
Figure 3 January 2021 - March 2023 Monthly Export Value Trend of Sewing Machinery
(Source: General Administration of Customs)
Comprehensive view, external demand fell, domestic demand is low under the two-way pressure, the first quarter of the industry's economy continued to decline at the end of the previous year, production and sales bottomed out hovering, enterprises generally bear the low demand, high costs, low profits and other pressures and tests. The industry as a whole to thoroughly implement the Party's 20th National Congress and the spirit of the Central Economic Work Conference, firm confidence in development, accelerate scientific and technological innovation, promote structural adjustment, accumulate growth momentum, and turn to high-quality development. At the end of the first quarter, as the effect of China's economic stabilization policy continues to emerge, overseas local regional market demand gradually released, the industry's economic development in the trough to show the bottom stabilization, improve the rebound trend.
◆ Source | China Customs& China Sewing Machinery Association
◆ Editor | Deko Corporation
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