In the first quarter of 2024, with the continuous release of the macroeconomic combination policy effect in China, the national economy continued to consolidate its upward trend, and the demand advantage of China's super large-scale market gradually emerged. The endogenous driving force of economic development further strengthened, and at the same time, the global economy ushered in an overall recovery. Inflation pressure in major developed economies slowed down, and the consumption demand for textile and clothing in the international market rebounded, helping China's printing and dyeing industry to achieve a good start in economic operation. In the first quarter, the production situation of China's printing and dyeing industry was good, with a stable increase in the production of printing and dyeing fabrics, a steady increase in the export scale of major products, and gradual improvement in the quality and efficiency of development. The industry's operating income and total profit maintained a rapid growth, and the profitability of enterprises was significantly restored, laying a good foundation for achieving stable operation throughout the year.

The production situation has started well

Stable growth in production

         According to data from the National Bureau of Statistics, from January to March 2024, the production of printed and dyed fabrics by enterprises above designated size in the printing and dyeing industry reached 12.142 billion meters, a year-on-year increase of 3.96%. The growth rate was 4.23 and 2.66 percentage points faster than the same period last year and the entire year of 2023, respectively. In the first quarter of this year, with the implementation of a series of policies to support the development of the real economy showing remarkable results, China's overall national economy continued the upward trend since 2023, with industrial production steadily increasing. In the first quarter, China's GDP grew by 5.3% year-on-year, ranking among the top in the world's major economies; In March, the Purchasing Managers Index (PMI) of China's manufacturing industry was 50.8%, rebounding to the prosperous range. The terminal consumption of textiles and clothing continues to recover, driving the production of the printing and dyeing industry to maintain growth. In the first quarter, the per capita clothing consumption expenditure of residents in China increased by 12.4% year-on-year, and the retail sales of clothing, shoes, hats, and needle textiles by units above designated size in China increased by 2.5% year-on-year.

Simultaneous improvement of development quality and efficiency

Significant improvement in enterprise efficiency

         According to data from the National Bureau of Statistics, from January to March 2024, the proportion of three expenses for printing and dyeing enterprises above designated size was 7.64%, a year-on-year decrease of 0.31 percentage points. Among them, financial expenses decreased by 22.45% year-on-year, ending the growth trend since 2023, and the financial situation of printing and dyeing enterprises gradually improved; The turnover rate of finished products was 13.10 times per year, an increase of 2.65% year-on-year; The accounts receivable turnover rate was 7.90 times per year, an increase of 6.94% year-on-year; The total asset turnover rate is 0.88 times per year, a year-on-year increase of 6.92%. The main operational efficiency indicators have improved compared to the same period last year, and the quality of enterprise operations has gradually improved.

           In terms of benefits, according to data from the National Bureau of Statistics, in the first quarter, the operating revenue of printing and dyeing enterprises above designated size was 68.076 billion yuan, a year-on-year increase of 11.36%; Realized a total profit of 2.06 billion yuan, a significant year-on-year increase of 111.53%; The cost and expense profit margin was 3.19%, an increase of 1.53 percentage points year-on-year; The sales profit margin was 3.03%, an increase of 1.44 percentage points year-on-year. Out of 1777 printing and dyeing enterprises above designated size, 769 households suffered losses, with a loss area of 43.28%, a year-on-year decrease of 2.16 percentage points; The total loss of loss making enterprises was 1.291 billion yuan, a year-on-year decrease of 14.57%. With the gradual recovery of market demand, the production of enterprises has grown rapidly, the level of industry efficiency has significantly improved, and the total profit has doubled on the basis of a lower base in the same period last year. The sales profit margin is the highest level in the same period since 2020, and the total loss of loss making enterprises has significantly decreased. However, it should also be noted that the current loss area of the printing and dyeing industry is still relatively high, 9.58 percentage points higher than the entire textile industry. There is an imbalance in the profitability of printing and dyeing enterprises with different products, scales, and business models, and some processing oriented small and medium-sized enterprises are still in a loss making state.

International demand is gradually recovering

The export scale is steadily increasing

           According to statistics from China Customs, from January to March 2024, the export quantity of eight categories of printing and dyeing products was 7.582 billion meters, a year-on-year increase of 6.54%, and the export amount was 7.324 billion US dollars, a year-on-year increase of 4.95%, with growth rates accelerating by 7.37 and 14.10 percentage points respectively compared to the same period last year; The average export unit price is 0.97 US dollars per meter, a year-on-year decrease of 1.49%, which is 6.89 percentage points narrower than the same period last year. In the first quarter, the direct export of major printing and dyeing products maintained growth. Firstly, due to the low base effect, the printing and dyeing industry faced export pressure during the same period last year, resulting in a decline in product export scale; Secondly, since the beginning of this year, the world economy has shown signs of recovery, with external demand tending to improve and export performance better than expected. It should be noted that the average export unit price of the eight major categories of printing and dyeing products in the first quarter continued the downward trend in 2023, and the competitive pressure on industry exports has not been effectively alleviated.

          China's exports to major markets have shown a trend of simultaneous increase in quantity and price. In the first quarter, the export quantity of China's eight major categories of printing and dyeing products to ASEAN and RCEP trading countries increased by 8.40% and 7.23%, respectively. The average export unit price increased by 3.26% and 2.04%, respectively, with growth rates higher than the overall export growth rate. From the perspective of major single countries, exports to countries such as Vietnam, Bangladesh, Brazil, and India have achieved rapid growth, with exports to Vietnam showing the most significant growth rate. The number and amount of exports have increased significantly by 32.07% and 38.59% year-on-year, respectively; Exports to countries such as Indonesia, Myanmar, Russia, and Pakistan have shown a simultaneous decline in both quantity and price. Indonesia and Russia have mainly experienced a year-on-year decline due to a higher base in the same period last year, while Pakistan has continued its downward trend since 2023.

           Overall, in the first quarter, the economy of China's printing and dyeing industry started steadily and made progress, with major economic indicators maintaining a good growth trend. The confidence of enterprises in development continued to improve, and the driving force for economic recovery further strengthened. Looking ahead to the second quarter and the whole year, the international situation faced by the printing and dyeing industry remains complex and severe. The global economy is still in a recovery period, and the spillover effect of high inflation will still have a long-term impact on the economic recovery process. The endogenous driving force for improving external demand still needs to be consolidated; Geopolitical conflicts and disturbances are still ongoing, and international trade protectionism is intensifying, which has a sustained impact on the stability of global industrial and supply chains. At the same time, it will also increase economic operating costs, posing a challenge to China's printing and dyeing industry's foreign trade. But it should also be noted that positive factors supporting the industry's economic recovery are also continuously accumulating. The stable and positive macroeconomic situation provides a solid guarantee for promoting the stable development of the industry. A powerful and effective policy combination will boost the confidence of the industry's development, improve development expectations, and provide important opportunities for the high-quality development of the industry by combining the huge potential of the domestic demand market with the trend of consumption upgrading. Next, the industry should continue to make efforts in transforming its mode, adjusting its structure, improving quality, and increasing efficiency. With a stable start, it will lead the way in achieving stability throughout the year, continuously consolidating and enhancing the positive trend of economic recovery.