According to Vietnam Customs statistics, Vietnam’s textiles and clothing in 2022Exports reached US$43.4 billion, a year-on-year increase of 11%. Although the data shows growth, Vietnam’s textile and apparel export orders and amounts have dropped significantly since the fourth quarter of 2022 due to demand from major export markets including the United States and the EU weaken.
In addition, Vietnamese textile and apparel manufacturers continue to be affected by production and other export challenges, including the continued rise in raw material and logistics costs (Russian-Ukrainian conflict and the epidemic), sharp fluctuations in international cotton prices, Vietnam’s tightening of monetary policy to control inflation, and increased labor costs.
According to a report by the Vietnam Textile and Garment Association, in the first quarter of 2023, Vietnam Textile export orders fell by 25-27% year-on-year. In response to the decline in orders, many Vietnamese textile and garment companies have reduced their operating rates, resulting in a large number of workers losing their jobs. The industry expects this downward trend to continue at least until the third quarter of 2023. Despite this, the Vietnam Textile and Apparel Association still sets the export target at US$46 billion in 2023, but only if the economy and consumption of major export markets recover.
In 2022, Vietnam’s textile industry will add approximately 100,000 spindles. The total number of textile factories is approximately 110, half of which are located in the south, 40% in the north, and 10% in the center. According to Vietnam Customs statistics, Vietnam’s yarn export volume in 2022 will be 1.6 million tons, a year-on-year decrease of nearly 19%, and the export value will be US$4.7 billion, a year-on-year decrease of 16%. A small increase in exports to Bangladesh failed to offset sharp declines in exports to China and South Korea.
Among all Vietnam’s yarn exports in 2022, Cotton yarn Exports accounted for 56%, but the export volume of cotton yarn was only 866,000 tons, a year-on-year decrease of 24%, and the export value was US$2.9 billion, a year-on-year decrease of 16%. The increase in cotton yarn exports in the first five months of 2022 failed to offset the decrease in the remaining period. The decline in global demand for textiles and apparel has led to reduced demand for raw materials such as cotton and cotton yarn in Vietnam. According to Vietnamese industry news, due to the combined impact of reduced orders and falling cotton yarn prices, the operating rate of most spinning mills in Vietnam has dropped to 50-70%. This trend is expected to continue until the first quarter of 2023. A rebound depends on the recovery of the global economy. Condition.
Data shows that Vietnam’s cotton yarn exports to China in 2021/22 were 78.8 million tons, a year-on-year decrease of 20%. In the first half of 2022/23, cotton yarn exports to China were 280,000 tons, a year-on-year decrease of 35%. Vietnam’s cotton consumption is expected to decline in 2022/23 due to reduced demand for imports of cotton yarn in China. In 2023/24, on the premise of economic and consumption recovery, Vietnam’s cotton consumption is expected to increase slightly by 3% to 6.5 million bales.
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