Home textile exports
from China surged dramatically in the first half of 2005 due in
part to the removal of quotas on certain products in January. However,
suppliers are looking at the rest of the year with cautious optimism
as limits on exports to the US and the EU could hamper growth rates
considerably.
While the EU lifted quotas on all home textiles in 1998, the
US removed the caps on towels, drapery and table linen in 2002 and
those on bed linen and quilts in 2005.
According to China customs statistics, total home textile exports
from the country rose by a modest 24 percent in 2004. However, shipments
in the first five months of 2005 soared nearly 40 percent to reach
US$2.2 billion from a year ago. But even more remarkable export
growth is evident in certain product categories to some of the country's
key markets.
Towel exports to the US in January to May 2005 reached US$119
million, a massive year-on-year increase of 105 percent. Shipments
of other product lines to the US also registered impressive growth
rates
bedding increased by 77.6 percent to US$220 million, while drapery
exports were at US$230 million, growing 25.7 percent.
Reacting to the jump in drapery shipments, home textile associations
in the US have petitioned to curtail imports of China-made curtains.
If quotas are reinstated, limits could be set sometime the last
quarter of this year.
In view of the steep rise in bedding exports to the US, similar
action on the product line cannot be ruled out.
In fact, bed and table linen have been the products of contention
in the EU. In January to May 2005, imports of China made bed linen
to the EU jumped 154.7 percent in volume and 57.6 percent in value
from a year ago. In response, China agreed to limit shipments of
table and bed linen to 5,521 and 6,451 tons, respectively. These
limits, which took effect in June, are filling up.
However, embargoes on shipments to the EU will not have a major
impact on the industry as the region accounts for only 14 percent
of total home textile exports.
Restrictions on US exports, on the other hand, could have more
far-reaching consequences, since it is the top market for China-made
home textiles. The US absorbed US$1.2 billion, or 25 percent, total
export sales in 2004.
In the shadow of these trade disputes, many China suppliers have
already started looking for alternative solutions. While some are
increasing sales to the domestic market, others are boosting exports
to Asia, particularly Japan. The country is China's second-largest
destination for home textiles, absorbing US$1.1 billion worth of
exports in 2004.
Industry composition
The home textiles industry in China is composed of more than 3,000
small, midsize and large suppliers producing bedding, drapery and
towels.
Irrespective of size, the majority of companies make bedding
products, with most offering both quilts and bed linen and some
focusing on one or the other.
Suppliers that manufacture quilts can also produce bed linen,
but those specializing in bed linen do not necessarily offer quilts.
This is because quilt production requires specialized machines for
cleaning, stuffing and quilting. Makers producing quilts usually
also offer similar products such as pillows and cushions.
Very few companies focus on drapery, and even fewer specialize
in table linen. Most suppliers have one or both of these product
categories as their secondary lines and bedding as their primary
line.
Makers offering towels usually specialize in the line, but some
large companies offering multiple types of home textiles have separate
factories dedicated to the product. The few small and midsize companies
that offer towels as their secondary line usually subcontract production
or dedicate a small portion of their factories to it. However, most
of these makers might not be able to provide the expertise that
towel specialists can offer.
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