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2010.07.27
Beware of overheating market, warns textile expert

The fast rebound of the textile and apparel market has allowed many textile mills across China to resume full capacity production, but an industry expert warned that there were signs of overheating and "illogical" development of the market.

At this year's ITMA Asia+CITME, Vice Chairman of China National Textile and Apparel Council (CNTAC), Gao Yong, advised the textile and apparel industry to refrain from blindly expanding the production scale, especially for the production of middle- to low-end goods.

He said that merchandisers might have predicted the appreciation of renminbi and tried to stock more goods before the rise in price.

"In the beginning of the year, there were more investments in different sectors, leading to price rise of cotton and yarns. The cotton price is now at record high. However, the price of apparel has not gone up as much. This trend, to me, is rather illogical. I would think that the middle- to low-end market may be overheating. Textile mills should not focus on enlarging production scale as a response to the present fast growth," said Mr Gao.

The Chinese textile industry, which was relatively less affected by the global economic crisis, enjoyed a rapid progress in the first five months of this year. Textile and apparel exports from China increased by about 19% compared with the same period last year. During the same months, China's domestic consumption of the products also rose 23%. All these positive developments have helped boost the sale of textile machines.

Mr Gao said that the trend was to invest in machines of high automation, low-carbon emissions and energy efficient. "There is heightened awareness of saving energy and reducing emissions," he said. "The requirements of machinery today are very different from the past five to 10 years. In addition to high speed and high capacity, there are also the requirements of flexibility - the machine needs to be able to process different types of fibres, use less energy, with high degree of automation."

Mr Gao said that China would soon bid farewell to the era of low-cost labor. With less involvement of human labor, more machine intelligence will come into play in the future.