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The exit turning point appears, and the recovery still has variables

The exit turning point appears, and the recovery still has variables

  • Categories:Industry News
  • Author:
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  • Time of issue:2019-06-18 17:40
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(Summary description)The cool autumn is hard to breathe the breath of foreign trade.
The first phase of the 106th Canton Fair, which is dominated by mechanical and electrical products, ended last night. Hunan Shenli Industrial Co

The exit turning point appears, and the recovery still has variables

(Summary description)The cool autumn is hard to breathe the breath of foreign trade.
The first phase of the 106th Canton Fair, which is dominated by mechanical and electrical products, ended last night. Hunan Shenli Industrial Co

  • Categories:Industry News
  • Author:
  • Origin:
  • Time of issue:2019-06-18 17:40
  • Views:0
Information
The cool autumn is hard to breathe the breath of foreign trade.
The first phase of the 106th Canton Fair, which is dominated by mechanical and electrical products, ended last night. Hunan Shenli Industrial Co., Ltd. is undoubtedly a bright smile. This company, which mainly produces glue (adhesive), has sold more than 300 in the first three days. Ten thousand U.S. dollars. According to the official data released by the Canton Fair, as of the 18th, there were 87,700 people from all over the world, and the attendance rate and turnover of buyers were significantly higher than those of the 105th Canton Fair held this spring.
At the same time, it can be seen from the macroeconomic data released in September that China's imports and exports are also entering the recovery channel. Yi Xiaozhun, deputy minister of the Ministry of Commerce, who attended the Canton Fair, said that from the positive signs appearing at the Canton Fair, China's foreign trade is showing a good prospect, but it still needs a lot of effort.
Turn point
As the largest category of Chinese exports, the trend of export of mechanical and electrical products has always been an important reference for all sectors to analyze China's exports. Liu Guizhong, general manager of Galanz Group's overseas development department, told the media on October 15 that the company's orders have already rebounded. It is expected that the export growth rate will exceed 80% in the fourth quarter of this year, completely reversing the 25% decline in the first half of the year.
Galanz's increase in orders is only a microcosm of China's electromechanical exports, and confirms the inflection point of China's export data. The latest statistics from the General Administration of Customs show that in September, China exported 68.54 billion US dollars of mechanical and electrical products, a sharp drop to 12.6% year-on-year, far better than the 20% decline in January-August.
Hunan's electronics companies also felt the same with this change. At the current Canton Fair, Wang Hao, deputy general manager of Changsha Wangwang Electronics Co., Ltd. said: "In the first five days of the Canton Fair, the actual turnover was far better than expected."
The data released by the Canton Fair Electrical and Mechanical Chamber of Commerce yesterday showed that in this session of the Canton Fair, the turnover of mechanical and electrical products rebounded significantly, and the turnover increased by more than 20% compared with the previous session. In the first four days, the cumulative turnover of mechanical and electrical products was US$9.62 billion, an increase of 26.3% over the same period of the previous year, accounting for 87.3% of the total turnover of the conference. The international market showed signs of recovery.
The relevant person in charge of the Electromechanical Chamber of Commerce believes that this indicates that the global economy is in a recovery phase, the enterprise destocking is basically completed, and a new procurement period has begun. “Our research shows that most companies are optimistic about the future. It is expected that the export value will continue to increase in the fourth quarter, and the year-on-year decline will continue to narrow. However, there is still uncertainty about the degree of recovery next year, and it is still necessary to continue to follow up.”
The analysis report released by the GF Securities R&D Center yesterday said that from the current published PMI index, power generation, FDI and other data, China's economy is in a period of sustained recovery and growth. “Through the survey of overseas markets, two-thirds of investors believe that the risk of a double dip in the world economy is fading, inflation is still far away, risk appetite is rising, and the market may be more optimistic than expected.”
Slow recovery
In the early days of the Canton Fair, due to the difficulty in finding a booth, some booths were even fired from 20,000 yuan to 80,000 yuan. In this "hot" situation, analysts said that although corporate orders and employment continue to grow, Exports to China are not too optimistic. For example, Sun Mingchun, head of China Equity Research at Nomura Securities, said: “The possibility of an overseas economy accelerating the pace of recovery is minimal, so we expect China’s export growth to slow down.”
According to the statistics of the Hunan Trading Group, as of October 18 (the fourth day of the first period), the total export volume of our group enterprises was US$113 million, an increase from the previous session, but decreased compared with the same period last autumn. . According to analysts from the Hunan Trading Group, this increase in the chain and the year-on-year decrease means that although the foreign trade is picking up, the foundation for recovery is still not solid. "In terms of the trading situation of the Hunan Trading Group, the top five are Russia, the United Arab Emirates, Pakistan, India and the United States. The demand in Europe and the United States has not yet been fully recovered." In the field of electromechanical exports, Hunan has always had an advantage. However, at this year's Canton Fair, it is difficult to see the top companies such as Sany Heavy Industry [-0.87% Fund Research Report]. In this regard, industry insiders analyzed that they are more directly involved in various trade fairs held abroad.
In fact, the analysis report of the Electrical and Mechanical Chamber of Commerce also pointed out that the recovery of various types of mechanical and electrical products was not consistent. Yao Wenping, vice president of the China Chamber of Commerce for Import and Export of Machinery and Electronics, said on October 14 that exports of ships, communications equipment and some home appliances were in good condition, while exports of other home appliances such as power tools and color TVs remained sluggish. Relevant statistics show that from January to August, machinery base parts, automobiles and parts, lifting and construction machinery fell by more than 20%, and container exports fell by 82%.
In the early days of the opening of the Canton Fair, there were media reports that the companies concerned tried to increase prices to increase profits. However, from the current transaction situation, although the orders exceeded expectations, the prices did not increase significantly. In the electromechanical exhibition area, Tan Yingqi, assistant general manager of Hunan Yitong Auto Parts Technology Development Co., Ltd. told this reporter that he had thought about rising prices in consideration of cost pressure, but it is not allowed under the current situation.
Liu Guizhong, general manager of the overseas development department of Galanz Group, even predicted that the export transaction price of the current Canton Fair will be lower than the previous two sessions. Since the end of last year, the government has raised the tax rebate rate for export commodities several times. The tax rebate rate for home appliances has increased by 3-4 percentage points. This positive benefit has been basically digested by lowering the price. In addition, the reduction of raw material costs and the stability of the RMB exchange rate have made the company's external quotation slightly lower than previous years.

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