The Situation Report of China wool textile industry (July 2015) The 27th China International Wool Trade Fair & Information Conference The Situation Report of China wool textile industry (July 2015) China Wool Textile Association Huang Shuyuan

Percentage points change Production Wool yarn production (year-to-date) in July 2015 reduces by 1.92% , 5.75 percentage points lower in growth rate; Wool fabric (year-to-date) in July 2015 decreases by 1.21%, 3.21 percentage points lower in growth rate. Year-to-date wool textile production in July 2015 Item Unit YTD production Year-on-year growth rate（%） growth rate in July 2014（%） Percentage points change Wool Yarn Tonnes 231865 -1.92 3.83 -5.75 Wool Fabric 0,000 m 33997 -2.00 1.21 -3.21 Source: National Statistics Bureau

Domestic Market The total retail value of clothing, footwear and knitwear in domestic market grows by 10.6% from January to July 2015 according to National Statistics Bureau. Retail value of clothing goods of 100 primary department stores declined by 2.6% in July 2015 according to CNCC. The growth rate is 3.8 percentage points lower than last month, and 5.4 percentage points lower year on year. Year-to-date production of woven garments increases by 1.98% in July (data from National Statistics Bureau collected from above-designate-size wool textile companies), in which, production of suits is lower year on year by 1.23%, however, the growth rate is 2.87 percentage points higher year on year.

Exports and Imports Export delivery value ( year-to-date) is 15.36 billion RMB in July, 1.39% lower year on year (data from National Statistics Bureau collected from above-designated-size wool textile companies) Year-to-date wool product export value is 4.99% lower year on year by July. Year-to-date wool product exports in July 2015 Item Unit Export volume Export value (0,000 USD) Account for % Year-on-year growth rate in volume (%) Year-on-yea growth rate in value (%) Cashmere Tonnes 1164 10636 1.62 -1.52 -12.48 Wool Top 27463 25991 4.04 -8.20 -16.93 Wool Yarn 27442 72847 11.13 -7.02 -7.06 Wool Fabrics 0,000 m 6460 43771 6.69 -9.81 -11.97 Blanket 0,000 p 28628 147902 22.59 -3.68 -11.27 Plush 39257 12385 1.89 19.68 9.23 Carpet 0,000 m2 34651 140926 21.53 3.23 2.72 Wool Knitwear 4151 55269 8.44 -3.71 4.67 Wool Woven Garment 2454 87117 13.31 -1.92 -4.08 Wool Scarf 1024 14668 2.24 39.63 61.01 Other － 43186 6.60 -12.91 Total 654697 100.00 -4.99 Source: China Customs

Year-on-year ±% by value Exports and Imports Export value (year-to-date) to EU, ASEAN, Japan and Hong Kong decrease by 10.35%, 3.96%, 15.26%, 5.01% respectively by July. Export value to US grows nicely by 10.70%. Export destination by July 2015 Destination % by value Year-on-year ±% by value EU 21.37 -10.35 US 15.41 10.70 ASEAN 11.01 -3.96 Japan 9.65 -15.26 Total 100.00 -4.99 Source: China Customs

Exports and Imports The summational export value of top 5 provinces in China for wool textile exports accounts for 66% in the past 7 months of 2015, in which, Jiangsu province and Zhejiang province, accounting for 25% and 19% of gross exports respectively , fell both by 5.55% and 8.21%. Primary provinces for wool textile exports by July 2015 Source: China Customs

Exports and Imports Total wool import is 238 thou tonnes, 22.17% higher year on year from January to July 2015. The growth rate is 34.44 percentage points higher year on year; total import value grows by 15.18%, 33.45 percentage points higher. Year-to-date wool import in July 2015 (Unit: tonnes, 0,000 USD) Category YTD imports YTD value ±% ±% by value Wool Total 238299 169708 22.17 15.18 Greasy wool 181139 142836 19.02 12.6 Scourced wool 47536 20396 35.91 33.79 Top 7364 5497 22.01 21.25 Noils 2253 978 22.45 38.00 Source: China Customs

Investment Statistics Industry category YTD investment value (0,000 RMB) by July 2015 YTD investment value (0,000 RMB) by July 2014 YOY ±% Textile industry 31492773 27842469 13.11 Wool textile industry 1916431 1819865 5.31 Top and yarn manufacturing 927992 943344 -1.63 Weaving 785986 686360 14.52 Dyeing and finishing 202453 190161 6.46 Source: National Statistics Bureau Fixed assets investments accomplished in the first 7 months of 2015 is 19.16 billion RMB, 5.31% higher year on year – the growth rate is 7.80 percentage points lower compared to the growth rate of textile industry, and is 25.85 percentage points lower year on year.

Industry situation and efficiency Total year-to-date income of prime business is 147.39 billion RMB in July, 9.45% higher year on year, 3.74 percentage points higher than growth rate of textile industry; total benefit comes to 6.56 billion RMB, 3.42% higher year on year, 3.62 percentage points lower compared to growth rate of textile industry; export delivery value is 1.39% lower (data from National Statistics Bureau collected from 1164 above-designate-size wool textile companies). Turnover of total assets is 1.32 times per year, 7.96% lower year on year; turnover of finished products is 13.29 times per year, 9.29% higher year on year; asset-liability ratio is 54.75%, 1.23 percentage points lower year on year; profit ratio is 4.45%, 0.26 percentage point lower year on year in the first 7 months of 2015 (collected from above-designate-size wool textile companies).

Summary Feedback from the 21st survey to textile industry entrepreneurs About 40% wool textile entrepreneurs report that production increases than the previous quarter Over 60% wool textile entrepreneurs expect production to be even in the following quarter 50% wool textile entrepreneurs find the orders increase than the previous quarter, while 33% wool textile companies have the increase on overseas orders Over a half of the wool textile companies expect the unchanged order level, while 33% wool textile entrepreneurs think the overseas orders will reduces further in the following quarter 40% wool textile entrepreneurs are not positive with the overall situation, a 13% increase than last survey 40% wool textile entrepreneurs are not positive with the situation of next quarter

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