Cotton, chemical fiber and the future

On the morning of October 14, 2018, Duan Xiaoping, vice president of the China Textile Industry Federation and president of the China Chemical Fiber Industry Association, made a special report on the theme of "cotton, chemical fiber and the future" at the 2018 China Cotton Textile Conference and the fifth session of the Fourth Council Expansion Conference, talking about the development of China's cotton and chemical fiber industry.

Chairman Duan said that the relationship between cotton and chemical fiber is three kinds of substitution, competition and interdependence, and in the development of the textile industry in recent decades, the relationship between the two has different characteristics at different times. Cotton, regenerated cellulose staple fiber and polyester staple fiber have advantages and disadvantages in terms of core resources, product properties and characteristics, and supply capacity. In the past 10 years, the amount of non-cotton fiber used in China's cotton spinning industry has continued to increase, reaching 12.7 million tons in 2017, an increase of 51.7% over a decade ago, accounting for more than 60% of the fiber volume of China's cotton spinning industry.

President Duan introduced the balance of cotton supply and demand in recent years, analyzed the situation of cotton reserve and the trend of cotton price difference between domestic and foreign, and sorted out the changes of cotton policy in recent years and the impact on cotton spinning industry.

Regarding chemical fiber, President Duan introduced that in the past ten years, China's chemical fiber production has continued to grow, with an average annual growth rate of 7.38%, and with the continuous expansion of the base and the adjustment of the global division of labor, China's chemical fiber production growth rate has gradually slowed down. The development of chemical fiber will show the characteristics of: integrated development of polyester refining, industrial concentration, intelligent manufacturing and green development.

President of the end said that China's grain and cotton contention for land is still prominent, the future in the tense situation of international trade, cotton planting area is difficult to expand effectively, viscose fiber has the ability to make up for the shortage of cotton supply, China will vigorously develop viscose fiber closely related to cotton in the future. Mainly through two ways to achieve: first, the green production of conventional viscose fiber, conventional viscose staple fiber has been put into production capacity of 630,000 tons in the past year, the next year to put into production capacity of 680,000 tons, the next five years planned production capacity of 1.1 to 3.6 million tons; The second is the localization of Lyocell fiber, Lyocell short fiber has an existing capacity of 45,000 tons, and plans to put in 135,000 tons of capacity within 5 years. Another 740,000 tons are planned.

President End said that from the past 10 years to see the competition between chemical fiber and cotton, although chemical fiber has occupied a certain advantage, but basically benign, the competition has promoted the technological progress of their respective industries, the future chemical fiber, cotton will peacefully coexist, occupy their respective markets, but the increase mainly depends on chemical fiber.

President Duan believes that due to China's obvious competitive advantages, chemical fiber will continue to develop, but the development speed will gradually slow down, and basically synchronize with the global growth rate before and after 2020, and the proportion of the world will be basically stable.

Regarding cotton, he believes that in China, due to the large population and limited available arable land, more attention should be paid to food production in the future, and cotton cultivation will be further concentrated in Xinjiang due to the impact of climate and soil conditions. China will further liberalize cotton imports and increase the quota. The national round in round out system will be launched at an appropriate time, and the specific operation will be more market-oriented.

Regarding the Sino-US trade friction, President Duan said that the Sino-US trade war is not just a "trade war", but a deeper reform and strategic war. The United States is the second largest market for China's chemical fiber exports, with an average annual growth of 7.56% in exports in the past five years, but the proportion of China's total chemical fiber exports is declining, and chemical fiber products exported to the United States are mainly polyester filament, staple fiber, nylon filament fiber, viscose staple fiber, of which polyester staple fiber accounts for about 46%.

The Sino-US trade war involves the whole industrial chain of chemical fiber, and the United States is the largest market for China's polyester staple fiber exports, accounting for 14.4% in 2017, and has maintained a proportion of 10%-20% in recent years. Although the proportion of exports to the United States in domestic production is not high, the impact of trade friction can not be underestimated for the more vulnerable polyester staple fiber industry. After the imposition of tariffs, the competitiveness of China's polyester staple fiber exports to the United States market is weakened, and South Korea may become the best, or promote the load of U.S. local staple fiber producers. China's polyester staple fiber industry is fragile, and the imposition of tariffs may lead to weak industry sales and affect efficiency.

Total viscose staple fiber exports to the United States accounted for only 1% of domestic production, and in the United States 200 billion final list excluded the largest export volume of 55041000 uncombed viscose staple fiber, so the trade war on the actual negative impact of viscose staple fiber exports is not large. China's 5% import tariff will have a certain impact on the viscose fiber industry, which will increase the cost of raw materials for enterprises. In order to reduce costs, companies may choose to replace the United States with other sources of imports, such as further concentration in Brazil, Indonesia, South Africa and other countries.

China's cotton imports from the United States accounted for the first, accounting for more than 40% in 2017. The 25% tariff will significantly increase the cost of cotton, cotton textile enterprises on the one hand will look for other sources of import instead of cotton, pollution-free cotton and Brazilian cotton is more likely to replace the United States cotton, Indian cotton as the second choice, on the other hand will adjust the product structure, increase non-cotton fiber application development, which is an unexpected opportunity for non-cotton fibers.

President Duan put forward four suggestions on the countermeasures of enterprises: (1) Take small steps and invest cautiously; (2) Three do not hesitate: grasp management, engage in research and development, machine replacement; (3) The Belt and Road Initiative, which actively integrates resources and allocates global resources; (4) Must have non-cotton configuration.