Towards the end of the year, foreign trade orders showed signs of rebound

As the largest small commodity wholesale market in the world, the International Trade City under the Small Commodity City (600415.SH) is the core part of Yiwu’s foreign trade industry, with a total of 5 districts, gathering about 75,000 small and medium-sized merchants.

On the afternoon of 14th, the reporter visited the trade city to feel the popularity, and the big screen above the entrance rolled the “Yiwu · China Small Commodity Index”. According to the analysis of commodity index network, the price index fell slightly in the second week of December, and the offline transaction was hot, driving the exchange price index and export price index up. The popularity of military coats has brought about a sales boom that has led to the production of related clothing accessories and accessories. In addition, skin care and beauty products, hygiene and cleaning daily necessities and other products are also hot.

Shuttering in the first district of the International Trade City, the reporter saw the merchants quickly moving between stores to negotiate business, and the merchants in the stores were busy receiving customers and taking inventory of goods.

Reporters randomly visited 8 businesses to learn that this year’s performance has increased. “We have been working in the Trade city for decades. This year is definitely better than last year, mainly due to orders from old customers.” A home decoration shop owner said. Another main lamps export shop owner revealed that this year’s performance is expected to reach 30%-40% year-on-year growth, the overseas market demand has picked up. However, when it comes to whether the business performance will recover to the level of 2019, merchants say ambiguously that there is still a long way to go. As for what the market is expected to be next year, merchants are cautious, most of them reply “not clear”, “difficult to say”, “hope is getting better and better”.
It is reported that the 8 interviewed merchants are all traditional foreign trade merchants, mainly responsible for connecting with overseas merchants to complete the order, and the subsequent production, logistics and warehousing are entrusted to factories and foreign trade companies to follow up. In addition, they will also rely on the small commodity city to build chinagoods platform to expand online business, which is the mainstream foreign trade mode of the trade city.

The performance of the trade city upstream of the merchants is even brighter. Chen Zhixing, deputy general manager of Mall Group, said, “From January to November this year, the sample transaction volume of the whole market exceeded 200 billion yuan, the average daily passenger flow exceeded 200,000, and the average daily foreign flow was more than 3,100, basically recovering to the level of 2019.”

According to him, among the major markets, Yiwu has closer trade with countries along the Belt and Road and other RCEP countries. From January to November this year, Yiwu’s imports and exports to countries along the Belt and Road totaled 292.47 billion yuan, up 22% year on year. The heating up of trade under the Belt and Road Initiative is also reflected in the transportation link. Fan Xiaohong, head of the East China International Combined Transport Port, told reporters that the number of freight trains sent next year is expected to continue to grow, and to meet the increased demand, plans are being made to add more China-Europe freight trains to Central Asia.

Downstream textile foreign trade proofing increased
Domestic textile and clothing exports ushered in good

Recently, Jiangsu and Zhejiang area textile market trade orders have increased signs. A textile trader said: “Recently, I received an order for 100,000 metres that were sent to Vietnam to be used to make readymade garments. Orders in November were much better than in the previous 10 months. Before there were really no orders and there were small orders for thousands of meters. Since November, the order book has been in the tens of thousands of meters, and the order book has also grown significantly. There have been several orders and staff have been working overtime for more than a month.”

Towards the end of the year, there are signs of a rebound in foreign trade orders, suggesting that this slump may change in the first half of next year. Industry insiders generally believe that there are also opportunities for China’s garment exports next year. On the one hand, the continuous efforts of the Chinese government in terms of favorable policies, the implementation of numerous new trade regulations, and the entry into force of some trade agreements will jointly promote the stabilization of China’s garment exports. In addition, since the beginning of this year, China’s garment export to emerging markets has grown rapidly, which has promoted a more diversified market structure of garment export, which will have a positive driving effect on garment export in the future. On the other hand, after a year-long pattern of small-scale orders, overseas customers gradually digest their clothing inventory, and overseas replenishment demand will rebound, which will bring new export orders to apparel companies. All orders received so far are for next year’s new models, which are being developed gradually.

In addition, the annual Spring Festival holiday will come in the future, and overseas enterprises will also prepare goods in advance to avoid being unable to place orders during the Spring Festival and delay the production schedule of ready-made clothes. Vietnamese factories are offering 7 million to 10 million dong, or about 2,100 to 3,000 yuan, at the time of hiring, much higher than in 2021. This wage rate is actually increasing worldwide and Vietnam no longer has the advantage of low cost. As a result, European and American customers are shifting orders back to China. Moreover, we also find that some markets such as the European Union have put forward green requirements for imported textiles, and have strict requirements on product quality and raw material sources. Other countries simply do not meet this requirement, and only domestic products are allowed through customs. So China still has a competitive advantage.