China : One-third of EU & US textile quotas wasted in 2006

According to the data released by Chamber of Commerce for Import and Export of Textiles, last year, China unexpectedly wasted one-third of her 33 categories of textile quotas to the EU and the US. The quota utilization rate under category 666 (curtain) only reached 3.8 percent.

Data shows that last year's quota utilization rate of China's exports to the EU of 21 categories was 56 percent by arithmetic average. In other words, nearly half of the export quotas to the EU were wasted.

Among them, the utilization rates of categories 200/301 (cotton yarn, sewing thread and yarn), category 619 (filament fabric), category 666 (curtain), category 620 (other synthetic fabric) were less, all of which did not exceeded 50 percent.

The arithmetic average utilization rate of 10 categories of textile quotas to the US registered 72 percent. Category 39 (tablecloths) was no more than 50 percent.

Taken together, the wastage rate of textile quotas to Europe and the US was as high as 33 percent.

In 2005, Ministry of Commerce acquired the textile quotas to Europe and the US through tough negotiations. Why China wasted such high utilization rate last year? There were many reasons leading to this situation. RMB revaluation uplifted the cost of exports. Re-exports from individual enterprises was one of the reasons, too.

Nevertheless a more important reason was that quota prices were traded too high by the beginning of 2006, many enterprises were unable to absorb quota cost, so they dared not to accept orders, causing orders shifting to other countries or regions.

Until 27 of last July, Department of Commerce published the ‘Textile export volume agreement tender notice of 2006 Annual exports to the EU (US)’, textile quota prices began to decline significantly, but by then the lost overseas orders were difficult to be recovered.

 
Fibre2fashion, News Desk - China