Japan’s textile and apparel imports in May were up 13 per cent year-on-year and 10.4 per cent month-on-month. Imports from China increased 15.3 per cent compared to the same period last year and 21 per cent compared to last month. Japan’s textile and apparel imports from n January to May were down 0.1 per cent from the same period last year and 2.7per cent compared with the same period in 2019.

Both in terms of import volume and value, Japan’s textile and apparel import demand recovered in May, showing a large rise, and Japan’s textile and apparel imports value from China was only slightly lower than that of the total imports.

In recent years, the proportion of import volume and value of Japan's textile and apparel imported from China in total imports has a certain seasonal rule, with the largest share in September or October every year, which gradually falls back to a relatively low level in April or May next year and then fluctuating. Japan's textile and apparel imports growth hit a new-2022 high because of the low base in the same period of 2020.

Chinese textile manufacturers are struggling with decreased orders amid increasing rivalry with regions without Covid-19 restrictions. For 85 per cent garment enterprises there is a significant loss of orders.  Since the second quarter of this year, North American and European offline exhibitions have reopened. This is having an adverse effect on China's orders. Domestic firms are struggling to develop new customer relationships abroad and show their products offline amid the country's Covid Zero strategy and rising logistics costs.

In the first half, some $6 billion worth of textile orders were transferred out of China, mainly to India, Bangladesh, Vietnam, Indonesia, and Cambodia. It is expected that in the second half, the trend may accelerate. The effect can be felt at the grassroots level. This year, orders tally were at least 40 per cent less than last year.

But there are bigger issue is poor demand. In the first half, domestic textile and apparel consumption fell nearly 20 per cent, and foreign markets are also shrinking. The overall loom operating rate in Jiangsu and Zhejiang provinces is currently less than 50 per cent, the lowest in the past five years.

In May 2022, China’s PSF exports increased 24.4 per cent Y-o-Y and 0.8 per cent M-o-M to 90,000 tons. Imports declined 44.4 per cent Y-o-Y and 8.5 per cent M-o-M to 6,500 tons. However, in the first five months of 2022, exports declined by 4.6 per cent Y-o-Y to 19,200 tons, says a CCF Group report.

China gave inadequate orders for export of recycled PSF in the first half of 2022 imports from Southeast Asia and Africa increased. China’s imports were impacted by supply recovery in the overseas orders. China’s PSF imports declined by 51 per cent to 38,900 tons during January-May 2022 compared to the same period last years. China’s PSF imports from Myanmar declined sharply in 2020. In 2021, imports were mainly impacted by the epidemic and February 1 coup. China imported only 378 tons of 2021 while in 2022 it has not imported any PSF till now.

Imports from Vietnam decline 77.4%

Imports from Vietnam in 2018 had grown to 13,113 tons and reached 30,567 tons in 2021. The increase was mainly attributed to demand recovery, larger price spread between virgin PSF and recycled PSF and speculative demand around the Lunar New Year.  In 2020, a few new plants engaged in solid re-PSF became operational, with a capacity of 50 tons per day, and the products are mainly delivered to China. This helped China’s imports from Vietnam to rise higher Year-on-Year. 

In September 2021, imports totaled 729 tons, however, in October it declined to lowest 459 tons, due to strict lock-down measures. Later, with epidemic control and relaxation of power rationing, imports climbed to nearly 2,000 tons in November-December, 2021. Affected by surging sea freight, China-origin cheap fibers were hard to sell to Vietnam. From January, 2022, imports from Vietnam reduced largely, lower than the same period in previous years. In January-May, 2022, imports from Vietnam declined 77.4 per cent Y-o-Y to 4,106 tons.

Imports from Thailand, Cambodia dip

China’s imports from Thailand tripled in 2019 to 45,000 tons compared to 2016. In 2020, imports declined to 42,127 tons, and in 2021 they further declined to 31,996 tons. In January-May, 2022, imports were 8,950 tons.

In 2021, the imports from Cambodia were 1,261 tons. In January-May, 2022,  they declined to 542 tons. Imports from Southeast Asia have been on the decline from 98,390 tons in 2019 to 78,779 tons in 2020, 76,245 tons in 2021 and 17,298 tons in January-May, 2022.

Imports from Africa rise

Interestingly, China’s PSF imports from the African market have been gradually rising in recent years.  In 2018-2019, China transferred a few domestic production lines to Africa. This helped boost PSF exports to China. In 2020, China’s PSF imports from South Africa and Nigeria grew 28 per cent. But, in 2021, imports from South Africa shrank sharply affected by the riots, which caused disruptions of plant operation. Imports from Nigeria reached 2,728 tons in March’21. But imports from Africa were nil in the fourth quarter of 2021. In 2022, China imported only 455 tons of PSF from Uganda. 

Around 110 companies produce home textile and terry towel items in Bangladesh currently, according to the Bangladesh Terry Towel & Linen Manufacturers & Exporters Association. Their factories employ nearly 65,000 workers and have investments totaling around $1.20 billion.

The success of the terry towel business in Bangladesh is attributed to Sonar Cotton Mills, the first towel factory in the Chattogram Export Processing Zone.  According to The Business Standard, the factory has helped Bangladesh increase towels and home textiles production and exports to $1.2 billion annually.    

Terry Towels a booming business

Established in the 1984 by Rais Khan, a Pakistani-born US citizen, Sonar Cotton Mills produces around 30,000 kg of towels per month. The company exported terry towels worth over 1.62 million in FY2021-22. Its products are now sold at multinational shops such as Amazon. Currently, the factory is run by Khan's son Shariq Khan who joined the production unit in 2002. 

Shariq attributes the company’s success to the local towel-making sector and fashion quota system for the least developed countries through which the US sourced 1.2 million kg of towels from Bangladesh. He affirms, Bangladesh has a good reputation for skilled workers, many of whom joined the factory in 1984 and contributed to its current success.  

The company faced many challenges along its journey, says Shariq. The factory was hit by a cyclone in 1992 which damaged all machines. It took him seven years to restore production in 1998.  Barely recovered, it was once again hit by the 2007-08 global recession, which forced it to allow local investments in the factory.

Since 2003, Sonar Cotton has exported products worth $19.73, as per the Bangladesh Export Processing Zones Authority (BEPZA).The company has many new orders despite using its full manufacturing capacity. It now plans to set up a new factory in Mymensingh to double production in the next two years, Shariq asserts.