RMB Exchange Rate Soar Strategy Of Textile Industry

From 8 to 7, the position of 6 is also in jeopardy. Data from the China Foreign Exchange Trading Center show that in May 6th, the central parity of the RMB against the US dollar was 6.2114, which was only 32 basis points different from the 6.2082 high exchange rate set last Thursday.

The RMB exchange rate has surged in recent years, which has added a lot of color to the internationalization of the RMB. But the fact that the renminbi has risen and depreciated has not been overlooked, which has caused many export enterprises to suffer from "devastation", and as a representative of China's labor-intensive industries. Spin Industry is the first to be hurt.

"Grab time" with exchange rate

The continued rise of the RMB exchange rate has a great impact on domestic textile export enterprises dominated by labour intensive. "Each order is confirmed at the rate of exchange at the following time, but the production cycle of the textile product is relatively long. It will take several months from the order to the delivery. During the exchange rate, once the exchange rate rises, the company will suffer a lot of losses." Li Gang, general manager of Changhe industry and Trade Co., Ltd., expressed reluctantly to the China trade daily reporter.

Li Gang calculated this account to reporters: if the exchange rate is 6.3 at the time of signing a contract, and the 5% profit is the base price, if the time of delivery is RMB 6.2 or higher, the direct loss of the enterprise will reach more than 1%. Today, as a labor-intensive industry, the profit of textiles is not very high. A profit of 100 thousand US dollars will be tens of thousands of yuan.

"In order to minimize the losses caused by exchange rate fluctuations, we only have to fight against the exchange rate." Li Gang joked to reporters, "now that the exchange rate is rising fast, we are afraid to take orders."

Changhe industry and Trade Co., Ltd. is just a representative of enterprises in the exchange rate dilemma. Many textile enterprises have not escaped the above fate.

As the first group of Hongkong people to do textile business in Guangdong, Zeng Xiang has been struggling for more than 40 years in the textile field. He recalls that he used to exchange 100 Hong Kong dollars for 120 yuan to 130 yuan, and the last time he used only 100 Hong Kong dollars to exchange for 77.8 yuan, the renminbi appreciated more than 30% against the Hong Kong dollar.

Now, "there is no profit in exporting textile products. Our company has to stop processing trade." Zeng Xiang said.

At present, China's competitive advantage in traditional labor-intensive industries has been gradually lost due to factors such as rising labor costs, weak foreign market demand and unstable RMB exchange rate. The rising demand in the New South American market (Mexico, Brazil, Chile), the Nordic market and the African market can not effectively alleviate the cold market in the traditional market.

The import and export data released by the General Administration of Customs showed that China's imports rebounded sharply in the month of March, while export growth slowed down and the deficit was 880 million US dollars. This is the first deficit in China's foreign trade in the past 13 months. It also proves the difficulties of Chinese enterprises' exports from the side.

　 Rising or falling of Renminbi

although RMB rate The external market is soaring, but it is facing an embarrassing situation of depreciation in China. This makes domestic prices rise rapidly, and the increase in labor costs and raw material costs will make textile enterprises' situation worse.

"Now, the wages of workers are two times higher than those in previous years, and the average workers' wages are 3000 yuan / month, and the wages of technical jobs will be higher." Li Gang told reporters.

And another cost of textile industry "big head" - raw materials, are also rising prices. Because China implements the import quota of cotton (20175,70.00,0.35%), the domestic textile enterprises mainly use domestic cotton. But at present, the price of domestic cotton is 3000 yuan to 4000 yuan higher than the international price per ton, which has caused great trouble to textile export processing enterprises.

However, there are good news. The relevant data show that in the future, the cotton price difference between China and foreign countries will have a further shrinkage probability. The negative factors that will affect the global competitiveness of China's cotton textile industry will be weakened.

But even so, for the time being, the pressure of textile enterprises to survive is still huge. Therefore, in recent years, many textile enterprises began to transfer production bases, from the Pearl River Delta to the Yangtze River Delta to the western region. Now, many enterprises have moved the industrial chain to Vietnam and other Southeast Asian regions.

Li Gang regrets to reporters that at present, the price of domestic textile enterprises can not be compared with those of Southeast Asian countries, and the latter produces one. clothes The cost is much lower than that in China, so many orders are also lost to the other side. "But this is also good. Companies need not worry about exchange rate changes." He could only console himself with this.

Enterprises or alternative activities

"The government has thought a lot of ways to find a way for foreign trade enterprises, such as transformation and upgrading, and brand strategy, but it doesn't work at all, and it is also a drop in the bucket for enterprises. In fact, as long as we can control the appreciation of the renminbi, exports will naturally develop to a better side. A textile industry personage told reporters.

However, "the RMB exchange rate change can not be avoided. This is the national strategy and also the stage of internationalization of RMB." Qin Yu, a financial critic, told reporters that since the renminbi keeps rising, why do businesses not import? Now, Chinese enterprises can buy cheap products from abroad, sell them to the country, or import low priced raw materials, produce high value-added products and export them, and perhaps achieve unexpected results.

"Export enterprises can pick up short lists, small bills, or do business with countries that can make RMB settlement, and make strategic transfer. Insiders told reporters.

However, although the future development of China's textile industry is still difficult, it is gratifying to note that the industry's expectation for the market environment is still good. Information from the China Federation of textile industry shows that in 2013, the market environment for China's textile industry was generally better than last year. The external demand environment is relatively stable, the domestic demand market fundamentals remain good, and with the implementation of macro-control measures. market Confidence recovery, domestic sales growth still has room for improvement.