Future of textile industry is quite unpredictable

27 Jun '08

2 min read

A recently conducted survey to study the energy consumption of 1000 enterprises shows that viscose filament and vinylon industries take up the top two spots, marking the highest power consumption volumes.

According to the statistics from the China Chemical Fiber Association, electricity consumption of chemical fiber industry stood at 22.2 billion kilowatt hour (kwh) and unit consumption was 972.5 kwh per ton in 2007.

Recently national average sales price of power has increased 0.025 yuan per kwh. For chemical fiber industry, it will directly increase the cost by 24.3 yuan per ton. If calculated by consumption of 972.5 kwh per ton, the industry will raise its annual electricity expenditure of 555 million yuan, considerably. This figure is almost equal to 4 percent of the total profit gained by chemical fiber industry in 2007.

Meanwhile, rising oil prices are adding to the burdens of textile industry, especially chemical fiber enterprises.

On the other hand, after a mapping survey of textile enterprises in six provinces and cities in March this year, it was noted that the average profits of 2/3 enterprises in the industry was only 0.62 percent. Profits of the remaining 1/3 enterprises ranged between 6-10 percent. Average profit of the whole industry was mere 3.9 percent.

Above facts reveal a very grave scenario of Chinese textile industry. It has been observed that many enterprises have ventured into more lucrative fields as they cannot bear these pressures. Meanwhile, many unfavorable factors have driven several companies, particularly SMEs, further into a predicament.

Government had implemented few new policies and had promised to issue more favorable schemes in the future. However, experts stress that such small steps will not be enough. They say that it is becoming extremely difficult to predict what future holds for textile industry.

Fibre2fashion News Desk - China

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