CHINA: EMERGING AS A WORLD FORCE IN TEXTILES

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• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP83B00227R000100220005-0
• Release Decision: RIPPUB
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• Document Creation Date: December 20, 2016
• Document Release Date: February 12, 2007
• Sequence Number: 5
• Publication Date: June 1, 1982
• Content Type: REPORT

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Directorate of Secret
Intelligence
China: Emerging as
a World Force in Textiles
Secret
EA 82-10067
June 1982
Copy 2 9 0
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Directorate of Secret
China: Emerging as
a World Force in Textiles
An Intelligence Assessment
Information available as of 15 May 1982
has been used in the preparation of this report.
This assessment was prepared by
Office of East Asian Analysis. Comments and queries
are welcome and may
be directed to the Chief-
China Division, OEA
Secret
EA 82-10067
June 1982
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China: Emerging as
a World Force in Textiles
0
Key Judgments China has the potential during this decade to become the world's leading
exporter of textiles and apparel. By 1985 the Chinese textile industry will
have the capacity to double its export volume while providing 50 percent
more cloth for domestic consumption.
Asian exporters and Western importing countries alike prefer that China
remain a supplier of raw materials to complement, rather than compete
with, their apparel manufacturers. Beijing nonetheless intends aggressively
to expand apparel exports because of their high value. Hard currency
earnings from apparel and other textile exports are slated to be a major
source of financing for China's economic modernization in the 1980s.
Low-cost labor makes Chinese textile products highly competitive on world
markets. Moderating world demand in the 1980s will intensify competition
between China and Asia's three big textile exporters-Hong Kong,
Taiwan, and South Korea. With developed nations tightening restrictions
on textile imports, increases in China's foreign sales will almost certainly
cut into the exports of the other major suppliers, heightening regional
competitive rivalries. We believe China will feel compelled to join the
international textile trade governing body, the Multifiber Arrangement, by
mid-decade to protect more easily and perhaps expand its share of world
textile trade.
Beijing also will try to soften international resistance by giving the
developed countries a vested interest in China's growing textile industry,
primarily through marketing agreements, equipment purchases, and tech-
nical assistance. Joint ventures and other forms of cooperation will combine
foreign skills in production and marketing with Chinese labor. Such
cooperative efforts may be the primary means by which the PRC expands
its exports during the 1980s.
To achieve its potential for increasing exports, however, China will have to
continue importing raw materials. We estimate that production of domestic
fibers will lag behind requirements, forcing Beijing to purchase large
quantities of cotton and wool in foreign markets. Capacity to print, dye,
and treat fabrics will be sufficient to process export goods but not all
domestically consumed textiles.
iii Secret
EA 82-10067
June 1982
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Textiles for the Chinese consumer will improve markedly by the mid-
1980s, both in quantity and quality. Still, the average Chinese will continue
to be poorly dressed by international standards. Clothing will remain a
major household budget item, and per capita consumption will remain far
short of the world average. Rural consumption, moreover, will improve
only slightly in the years ahead. The gap between fashion-conscious city
dwellers and peasants will widen and further aggravate urban-rural
tensions.
Beijing will pressure Washington for reduced limitations on imports of
Chinese textiles and apparel by threatening to stop its purchases of US
fibers. Nevertheless, the United States will continue to be the primary
supplier of cotton to China. US sales of synthetic fibers will drop sharply as
China expands its own capacity. American apparel manufacturers can
expect stiff competition from Chinese goods but may be able to profit from
cooperative ventures to produce and market Chinese textiles and apparel.
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Key Judgments iii
Importing Materials To Support Exports 4
Prospects for the 1980s 5
Gains in Domestic Consumption 6
Trade Outlook: Bullish on Exports 7
Implications for the United States 8
B. The Chemical Fiber Industry
C. Wool, Silk, and Other Fibers
1. PRC: Prices of Selected Apparel Items, 1981
2. PRC: Growth in Textile Exports, 1976-80
3. China's Major Textile Markets, 1980
4. PRC: Selected Textile Imports, 1980
5. PRC: Recent and Projected Production of the Four Main Fibers, 5
1981 and 1985
6. PRC: Cloth Production, 1980 and 1985
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China: Emerging as
a World Force in Textiles
Textiles: A Key to Modernization
China's textile industry is vital to the success of
Beijing's modernization plans. Textile exports are the
single largest source of the hard currency earnings
with which China hopes to finance economic develo -
ment during the 1980s
Rapid growth in recent years illustrates the priority
that Beijing has placed on the industry. The value of .
textile output jumped from a little more than 12
percent of total industrial production in 1977 to
almost 17 percent last year (see figure 1). The textile
sector is second only to machinery among China's 10
largest categories of industry.
The Ministry of Textile Industry directly controls
about 5,000 plants and 3 million workers. Additional
textile mills are run by provinces, towns, communes,
and even families. In all, the textile industry may
employ as much as 10 percent of China's nonagricul-
tural work force. Although among the lowest paid in
state-owned enterprises, the average textile worker
produces about 40 percent more in product value than
the average industrial worker. The textile sector also
is more energy-efficient, producing nearly three times
as much per kilowatt-hour as China's industrial aver-
age
The emergence of China's textile industry as a major
growth sector can be attributed to large investments
in new capacity in the 1970s. Since 1977 state
investment in textile and related industries has ex-
ceeded 1.3 billion yuan annually, about 6 percent of
budgeted investment funds. In addition, Beijing pur-
chased several large fiber mills from Japan and West
Germany at a cost of $3 billion. More recently,
proposed projects have been less costly and usually
involve upgrading existing facilities. In early 1982,
the textile ministry purchased a used woolen mill and
dyeworks from West Germany
Figure 1
Gross Value of Textile Output as a Share
of Gross Value of Industrial Output
10
100
86a
16
74a
14'"
59a
12
46a
53a
8
6
4
2
In another move to modernize and boost production,
Beijing has opened the Chinese textile industry to
direct foreign investment, mostly on a cooperative
basis. At present, at least 300 textile projects operate
as joint ventures, and 190 others process customers'
raw materials for export. More such operations will
open as southeastern provinces develop their trade
zones. Indeed, factories in trade zones could be the
major source of future growth in Chinese exports of
apparel.
Consumption Patterns
Even though the textile industry has grown dramati-
cally in recent years, per capita consumption in China
is still only one-half the world average. Cotton cloth is
rationed, and allocations vary according to location
and climate-ranging from less than 5 meters per
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Figure 2. Rural apparel con-
trasts sharply with cityfash-
ions.l---l
person in warm southern areas to 8 meters in colder
northern climates. Total 1980 consumption of all
fabrics was only 10 meters per person-barely enough
for a jacket, shirt, ants, underwear, and pajamas.
Despite the overall shortage of textile products, do-
mestic consumption has risen substantially since 1978
when wage increases provided more disposable income
to workers and peasants. Textile products accounted
for 25 percent of total retail sales in 1980 and led
sales increases in 1981. In urban areas, where expen-
sive and stylish clothing is gaining popularity, con-
sumption is nearly double the rural level and the gap
seems to be widening (see figure 2).
A recent survey suggests that the average city family
spends nearly two months' wages each year just for
clothing. With national annual per capita income less
than 300 yuan, the purchase of a wool overcoat
becomes a major undertaking (see table 1). About 70
percent of urban families own a foot-powered sewing
machine to make their own clothing. Ordinary cotton
cloth costs less than 3 yuan per meter, but cotton
prices are heavily subsidized. Wool costs 10 to 40
yuan and is usually hard to find. Polyester, which
costs about 2 yuan to manufacture, sells for 3 to 11
yuan per meter and is widely available. Beijing re-
cently cut the cost of polyester fabrics about 10
percent to make them more affordable and to clear
excess stocks.
Personal consumption by no means absorbs the entire
textile supply. Social consumption (hospital linens,
banners, Army uniforms), industrial uses (sacks, tire
cord, conveyor belts), and export commitments place
additional demands on the textile industry. Twenty
years ago, personal consumption accounted for 70
percent of PRC textile production, but in 1981 it had
dropped below 55 percent. Social and industrial uses
now absorb more than one-third of production, and
exports account for about 10 percent.
Export Patterns
China's drive to develop its textile industry has yield-
ed dramatic increases in exports in recent years. Sales
have risen about 26 percent annually since the mid-
1970s-from $1.6 billion in 1975 to $5.1 billion in
1980 (see table 2).' Textile fibers and products cur-
rently account for more than one-fourth of total PRC
exports and generate an equal amount of hard curren-
cy earnings.
' In 1975 dollars, the value of ex orts in 1980 is $3.6 billion an
18-percent annual increase.
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PRC: Prices of Selected Apparel Items, 1981
7 to 10
30
90 to 160
2
The United States has become a major customer for
Chinese textiles, increasing purchases nearly 60 per-
cent annually since 1975, to $440 million in 1980 (see
table 3). China now provides 10 percent of US textile
imports, and is exceeded only by Hon Kong, Taiwan
and South Korea.
Silk is the only fiber imported by the United States in
significant quantities. Most US purchases of Chinese
textiles consist of fabrics and finished goods, particu-
larly apparel, which accounts for nearly one-half the
total. Last year manmade fabrics and garments led an
overall 73-percent increase in US imports of Chinese
textile goods. The rapid increase in supplies of PRC-
origin products has alarmed American textile and
apparel manufacturers. The US textile industry em-
ploys about 13 percent of total manufacturing work-
ers and is highly sensitive to rising imports from low-
cost competitors. Some imported Chinese textiles cost
only one-third of what it costs American firms to
produce them, prompting US manufacturers to de-
mand protection.
The European Community, long a leading consumer
of Chinese textiles, also has become increasingly
negative toward imports from China. The EC's textile
and apparel industries account for about 10 percent of
their industrial work force. Since 1973 these indus-
tries have been on a downturn, and, with the continu-
ing economic slump, are now seeking protection.
France and the United Kingdom in particular are
PRC: Growth in Textile Exports, 1976-80
Vaue
(Million US $ f.o.b.)
Average Annual
Rate of Growth
(percent)
1975 1980
Total
1,632 5,113
26
Raw silk and yarn
150 282
13
Silk fabrics
113 268
19
Cotton fabrics
439 894
15
Synthetic fabrics
59 264
35
Linens
163 494
25
Men's, boy's outerwear
59 344
42
Women's, girl's
outerwear
41 318
51
Knit outerwear
46 273
43
Men's, boy's underwear
40 187
36
Knit underwear
59 149
20
Fur clothing
10 69
47
Other
453 1,571
28
I
concerned about the effect of imports on domestic
producers, although China supplied less than 3 per-
cent of their total textile imports in 1980. Italy
continues to purchase a large share of China's silk
exports for manufacture into high-fashion apparel but
has expressed protectionist sentiment toward PRC-
made sportswear
25
25)
Three of China's largest consumers purchase Chinese
goods to supply their own textile and apparel manu-
facturing sectors. Hong Kong, Japan, and Singapore
together accounted for 42 percent of China's textile
exports in 1980. Lacking the acreage to cultivate their
own raw materials, they buy Chinese fibers and
fabrics to process or sew into finished goods, largely
for export. Hong Kong is China's single largest
market. Two-thirds of Hong Kong's imports of Chi-
nese textiles in 1980 were raw materials for textile
and apparel manufacturers. Japan is China's second-
largest customer and the largest buyer of PRC silks,
which account for more than one-third of Japan's
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China's Major Textile Markets, 1980 a
Value of Textile
Imports From PRC
(million US $, f.o.b.)
Share of PRC
Textile Export
Market (percent)
PRC Share of
Market's Total
Textile Imports
(percent)
Textiles as a Share
of Market's Total
Imports From PRC
(percent)
Hong Kong
1,318 b
26
28
43
European Community
759
15
2
42
Belgium/ Luxembourg
28
1
1
23
Denmark
19
NEGL
2
48
Netherlands
54
1
1
32
United Kingdom
115
2
2
44
Japan
680
13
United States
440
9
Singapore
136
3
Australia
128
3
a Includes fibers, yarn, fabric, and apparel.
b Includes about $580 million in re-exports of PRC-origin goods.
imports of Chinese textiles. Japan is also among the
top buyers of cotton yarn and cloth. Singapore also
buys Chinese cotton and silk goods in relatively large
volume to manufacture garments for export. These
countries have not been as vocal as the United States
and the EC about China's growing impact on world
textile trade, but they have Dexpressed con-
cerns to Beijing that their own exports will fall to
cheaper Chinese competition.
Importing Materials To Support Exports
The rapid expansion of fabric and apparel exports in
recent years has forced Beijing to import more raw
materials. Purchases of fibers and yarn increased
more than 40 percent yearly between 1975 and 1980,
climbing to $2.6 billion. Fibers and yarn currently
account for about 85 percent of the value of Chinese
textile imports.
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Secret
PRC: Selected Textile Imports, 1980
US $)
Cotton
1,482
United States
Synthetic fibers, yarn
744
United States, Japan
Synthetic fabrics
239
Japan, Hong Kong,
United States
Clothing
21
Hong Kong
Nagging Problems
The rapid growth of China's textile sector has created
several problems of imbalance within the industry.
China's capacity to print, dye, and chemically treat
fabrics has lagged behind its ability to produce cloth.
In addition, the Chinese have been unable to produce
colorfast dyes and other treatments in the quantities
and quality required. They also have been slow to
develop and distribute processes for crease resistance,
shrinkage control, mildew prevention, water and soil
repellency, and other features required for ex ort-
ouality nroduct
The textile ministry recently made some progress in
overcoming problems facing the textile industry. It
has already started to purchase some capacity to
produce dyestuffs and has encouraged foreign invest-
ment in printing and dyeing mills. The ministry also is
restructuring its factories, closing those that continue
to operate inefficiently. Nevertheless, a shortage of
finishing capacity will continue into the mid-1980s,
and the PRC may have to direct more unfinished
goods to industrial uses and to domestic consumers
where top quality is not required.
PRC: Recent and Projected
Production of the Four Main Fibers,
1981 and 1985
Produc-
tion
Share of
Total
(percent)
Produc-
tion
Share of
Total
(percent)
Cotton
2,968
80
3,400
71
Man-made
527
14
1,183
24
Wool
189
5
208
4
Silk
37
1
44
1
Total
3,721
100
4,835
100
total fiber production by 1985. Under the most favor-
able conditions, however, these fibers will not exceed
25 percent (see table 5). Moreover, China has been
slow in implementing plans to increase wool fiber
production, and output will rise only slowly in the next
few years. Domestic wool production will, in fact,
account for a smaller share of raw materials in the
mid-1980s than it does now. The share of cotton in
China's total fiber supply will probably drop from the
current 80-percent level to about 70 percent in 1985
(the methodologies for calculating capacity estimates
for 1985 are presented in appendixes A, B, and C).1
Prospects for the 1980s
Projects now under way ensure that China will contin-
ue rapid expansion of the textile industry during the
1980s to greatly increase exports and domestic con-
sumption. Annual investment in the industry will
likely remain in excess of 1 billion yuan, and national
priorities will include:
? Completing major chemical fiber complexes.
? Doubling wool production capacity.
? Improving printing, dyeing, and finishing capacity.
Beijing will continue to encourage foreign investors to 25X
increase participation in joint ventures and compensa-
tion trade. We believe the textile ministry also will
seek assistance from Western as well as Asian firms
The failure of domestic fiber output to meet projected
goals will be a continuing problem. As late as 1980,
the textile ministry was still announcing in the press
that chemical fibers would account for 40 percent of
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Volume
Share of Total
(percent)
Wool
0.1
NEGL
Silk
0.8
4
Bast
0.1
NEGL
in design, processing, finishing, and marketing. In
addition, China will try to acquire advanced textile
manufacturing equipment, industrial sewing ma-
chines, and other devices to help improve quality
control and productivity.
Clothing stalls are already beginning to dominate free
Volume
Share of Total
(percent)
Volume
Share of Total
(percent)
0.2
1
0.2
1
1.0
3
1.0
3
0.1
NEGL
0.1
NEGL
We estimate that fabric output will increase 45
percent by 1985 (see table 6). Cotton fabrics and
blends will account for two-thirds of about 30 billion
meters of cloth production, with manmade fabrics
providing nearly all of the remainder. Woolen fabrics
will make notable gains with output increasing as
much as 60 percent. Even so, wool, silk, and bast
(linen, ramie) fabrics will remain relativel insignifi-
cant in terms of output volume.
Gains in Domestic Consumption
We believe that by 1985 the textile ministry probably
will be able to increase per capita domestic consump-
tion of textiles by 50 percent to about 15 meters.
Urban residents will average more than 23 meters
compared with 13 meters in rural areas. The disparity
between urban and rural consumption could increase
tensions between city and country residents as living
standards become more divergent.
markets and will play an even greater role in apparel
distribution later in this decade as individually operat-
ed clothing shops become common. Although official-
ly sanctioned editorials have been critical of young
people's predilection toward Western-style clothing,
modern fashions will probably become more popular
with younger consumers. Readymade foreign clothing
is currently available through relatives or black-
market connections and probably will be imitated by
tailors and apparel manufacturers for domestic con-
sumption. Prices will remain high, however, reflecting
both scarcity and high consumer appeal.
Because of increasing consumer expectations, Beijing
will be unable to continue forcing low-quality fabrics
onto the retail market. Chinese consumers, especially
in the cities, have become increasingly selective. In
late 1981, for example, a six-month supply of cotton-
polyester cloth remained in inventory because con-
sumers refused to pay high prices for low quality. To
reduce these stocks the government subsequently low-
ered prices on several blended fabrics.
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Social and industrial uses for textiles will grow only
marginally in the coming years. Polypropylene is
replacing cloth and burlap in sacks for packaging, and
new plants are opening to provide industrial-grade
synthetics for tire cord, conveyor belts, and other
purposes. Textiles no longer needed in industry will go
to social uses, which will show an overall increase of a
little more than 10 percent.
Figure 3
The Growing Importance of Apparel
in China's Textile Exports
Legend El Yarn
^ Fibers
Apparel
^ Fabric
Total 1975 Exports=
US $1.6 Billion
Trade Outlook: Bullish on Exports
We estimate that personal consumption will rise to 16
billion meters and other uses will increase to about 9
billion, leaving China nearly 5 billion meters of cloth
available for export in 1985, more than double the
estimated 1980 level of 2 billion meters. Exports could
thereby account for up to 17 percent of total roduc-
tion, compared with 10 percent in 1980.1I
Beijing also will try in coming years to increase the
value of textile exports (see figure 3). The trade
ministry has publicly announced plans to export a
larger share of China's textiles as apparel, concentrat-
ing on the higher value-added products to increase
hard currency earnings. PRC products will be com-
petitive in price and probably also in quality. Chinese
manufacturers and exporters will make every effort to
ensure that exported goods are of consistently high
quality, even if that means continued shortchangin
of domestic markets.
Beijing's primary obstacle will be resistance among
importing countries. After allowing textile imports
from Hong Kong, Taiwan, and South Korea to ex-
pand for several years, the developed nations have
begun to reject continued growth. In recent bilateral
negotiations between the EC and China, the importers
successfully limited trade growth levels. EC negotia-
tors also persuaded Beijing to link exports and im-
ports, so that EC exports to China (primarily of
manmade fibers) will rise as Chinese exports to the
EC increase. The EC also has proposed to China and
other textile exporting countries that outward process-
ing-the manufacture of goods from raw materials
supplied by the country to which the product will be
exported-be considered separately from direct im-
ports for quota purposes. Under this proposal, goods
could be more easily exported to EC nations if made
55.4
7.9
15.0
21.7
Total 1980 Exports=
US $5.1 Billion
49.2
7.5
from EC-origin raw materials. Most exporting coun-
tries have been lukewarm toward the idea, but China
could find this mechanism a useful way
trade-zone processing.
Another problem for China's growing textile industry
in the 1980s is an adverse reaction from other major
exporting areas-notably Hong Kong, Taiwan, and
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South Korea. With the world textile market de-
pressed, increases in Chinese exports would cut into
their sales. Hong Kong in particular has tried to
convey to Beijing its preference that China remain a
complementary, not a competitive, force in the Asian
textile scene. The expansion of Chinese textile sales at
a time of sagging world markets during the 1980s
could thus increase friction between Beijing and its
Asian neighbors.
China is not a party to the Multifiber Arrangement,
the international agreement that governs textile and
apparel trade between industrialized importers and
LDC exporters. China's bilateral agreements, howev-
er, contain provisions similar to those of the Multi-
fiber Arrangement. To date, Beijing has attended the
Arrangement's meetings as an observer but has re-
mained uninvolved in the dickering over quota levels
and allocations.
We believe China will feel compelled to join the
Arrangement by mid-decade. China's ability to ex-
pand rapidly its textile exports could unify importers
and other exporters to take steps to limit Beijing's
markets. By joining the Arrangement, China could
more easily protect and perhaps expand its share of
world textile trade.
Implications for the United States
The United States faces continued political and eco-
nomic pressures to reduce limitations on imports of
PRC-origin textile goods. China will demand greater
percentage increases in annual import quotas than
those allowed to Hong Kong, South Korea, and
Taiwan. If not satisfied, Beijing will threaten to
import most of its raw materials from non-US suppli-
ers and add the textile trade issue to the list of
grievances used when questioning US-PRC diplomat-
ic relations.
American cottongrowers face competition from
Egypt, Pakistan, Brazil, and others who are seeking a
larger share of China's cotton imports. Beijing will
likely reduce but not terminate purchases of US
cotton, primarily because American fibers are consist-
ently reliable in quality and availability. PRC pur-
chases of manmade fibers from the United States will
drop sharply as new domestic capacity becomes oper-
ational and replaces the need for imports
American apparel manufacturers can expect strong
competition from Chinese goods, in both US and
overseas markets. The quality of Chinese goods will
improve markedly by 1985. PRC export officials also
will learn to discern fashion trends and change the
industry's products accordingly, making Chinese
goods even more competitive
We believe Beijing will seek technical and marketing
assistance from US and other firms. Although Euro-
pean firms hold a technological edge in producing
textile machinery, American firms are known for
their prowess in processing, finishing, and marketing
textiles and apparel. The textile ministry will ask
some US firms to join in cooperative ventures with
Chinese enterprises to manufacture and export tex-
tiles and apparel. Indeed, such ventures may be the
only way some of the less diversified US apparel
manufacturers will survive Chinese competition.
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Appendixes
Appendixes A, B, and C provide methodologies for the derivation of estimates for
output, productivity, and potential of cotton, synthetic, and other fibers through
1985. Appendix D contains the fiber, yarn, fabric, and apparel sections of the
United Nations trade data for China, reprinted from China: International Trade
Annual Statistical Supplement, EA 82-10015, February 1982.
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Appendix A
China's Production of
Cotton Fiber and Cloth
Beijing ultimately wants to reduce dependence on
cotton for textiles, but, to meet the need for textiles, it
has encouraged high production of cotton for the last
few years. In 1979 the government increased official
cotton prices 15 percent and added a 30-percent bonus
for above-quota production. Cotton output increased
an average 10 percent yearly between 1977 and 1981
(see table A-1). In early 1982 China's media began to
express concern about substantial conversions of acre-
age from grain to cotton. With average conditions and
probable restoration of some acreage to food crops,
domestic output probably will increase to 3.3 to 3.5
million metric tons (mmt) by 1985.
Year
Total
(mmt)
Production
Imports
Volume
(mmt)
Share of
Total
(percent)
Volume
(mmt)
Share of
Total
(percent)
1977
2.3
2.0
87
0.3
13
1978
2.7
2.2
81
0.5
19
1979
2.8
2.2
79
0.6 a
21
1980
3.5 a
2.7
77
0.8 a
23
1981
3.6 a
3.0
83
0.6 a
17
Yarn Spinning
Data on China's output of cotton yarn and cloth
include both all-cotton and cotton-synthetic blends. A
rough calculation of the shares represented by cotton
and synthetics indicates that cotton's share has actu-
ally risen during the past five years (see table A-2).
This trend resulted from rapid growth in cotton
production and imports, coupled with the still relative-
ly small volume of available synthetic fibers.II
A major source of increasing spindle productivity is
improved utilization. On average, state-run mills op-
erate six days per week, with two or three shifts daily.
Beijing and Shanghai have been experimenting with
new shift schedules, most recently a seven-day, four-
shift system. The longer workweek provides a 17-
percent increase in production capabilities. With re-
vised work schedules, China's textile industry should
be able to increase yarn output 8 to 10 percent
annually through 1985.
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Cotton Yarn Production, 1977-81, 1985
Year
Produc-
tion
(mmt)
Available
Supply a
(mmt)
Imports
(mmt)
Exports
(mmt)
Personal
Allocations b
(mmt)
Supply for
Yarn Spinning
(mmt)
Yarn
Output
(mmt)
Cotton Share
of Yarn Output
(percent)
1978
2.167
2.088
0.508
0.036
0.494
2.066
2.382
86.73
1979
2.207
2.180
0.606
0.043
0.501
2.242
2.635
85.09
1980
2.707
2.374
0.820
0.030
0.509
2.655
2.930
90.61
1985
Projections
Scenario 1 c
3.3
3.223
1.295
0.035
0.542
3.941
4.637
85.0
Scenario 2 d
3.5
3.383
0.641
0.035
0.542
3.447
4.309
80.0
a Adjustment in available supply compensates for late summer d Cotton crop increases by 4 percent per year; yarn output up 8
harvest of raw cotton. It is one-third of the current year's domestic percent per year; cotton share of yarn is 80 percent. These scenarios
production plus two-thirds of the previous year's. yield the minimum and maximum expected import levels, given the
b Personal allocations for padding and other uses calculated at 1 broadest range of reasonable growth rates for cotton crops and yarn
catty (1.1 pounds) per person based on population figures supplied by output.
US Census Bureau Demographic Division population levels.
Cotton crop increasing by an average of 2.5 percent per year; yarn
output up 10 percent per year; cotton share of yarn is 85 percent.
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Spindle Productivity
(pounds)
1977
4.9
15.0
386
1978
5.3
15.8
390
1979
5.8
16.4
416
1980
6.5
17.2
442
1981
7.0
18.1
454
a The United States produced 6 billion pounds of yarn in 1979 with
about 17.2 million spindles, or 410 pounds per spindle at 85-percent
capacity utilization.
b output per spindle is based on an assumed capacity utilization rate
of 85 percent.
Cloth Production
China's publication of selected annual production
statistics for cotton and cotton-blend cloth helps in
calculating future capabilities. In the late 1960s the
standard Chinese conversion factor was 7,576 linear
meters of cloth per ton of cotton yarn. As the textile
industry has improved the quality of its cloth and
expanded its product line to include more heavy-
weight fabrics, average linear output per unit of raw
material has declined. Over the past five years, aver-
age output for cottons and blends was 4,562 linear
meters per ton. This is comparable to the 1972
average for US cotton broadwoven goods (see table
B-4 for comparability of conversion factors). Between
1978 and 1980, Chinese cottons averaged 37 inches in
width; US broadwovens have averaged about 45
inches.
Between 1980 and 1981, China's output per ton
dropped from 4,597 to 4,505 meters, which represents
a rather sharp decline that will probably continue. By
1985, output will likely be 4,300 to 4,400 meters per
ton. With projected cotton/cotton-blend yarn produc-
tion of 4.3 to 4.6 mmt, fabric production from these
years should be between 18.5 and 20.4 billion meters.
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Appendix B
The Chemical Fiber Industry
In the early 1970s Beijing decided to develop a major
petrochemical-based fiber sector (see table B-1). New
large complexes were planned for Shanghai, Tianjin,
Liaoyang, Nanjing, and Beijing. By 1979 China had
signed nearly $3 billion in contracts for plants to
produce textile-grade synthetic fibers. During 1979
uncertainties about petroleum feedstocks and financ-
ing briefly jeopardized some of these contracts. How-
ever, the textile ministry publicly gave priority to the
chemical fiber sector in 1980, with 80 percent of the
state investment for the textile industry being allocat-
ed to chemical fibers, and 21 of 34 planned new mills
being chemical fiber plants.
A second period of hesitation in 1981 again suspended
progress on imported plants. With less optimistic
prospects for long-term oil supplies, the textile minis-
try reduced the scope of the Nanjing project, which, if
completed, would have been the world's largest poly-
ester plant. For the present, only one-third of the
original capacity for the complex will be installed.
The Chinese have negotiated financing with Japan to
continue other suspended projects, and a few addition-
al smaller plants may be constructed.
Total
0.2
103
190
284
327
450
527
Cellulosic
0.2
53
84
115
113
136
142
Synthetic
0.0
50
106
169
214
314
385
Percent
Cellulosic
100
51
44
40
35
30
27
Cloth Production
Because a large share of chemical fibers is used in
blends and is reported along with the blended natural
fiber, it has been difficult to determine production
levels of pure chemical fiber cloth. China's announce-
table B-4).
States, the conversion factors seem reasonable (see
PRC fabrics compared with those made in the United
ments of new plants often mention capacity in terms
of both tons and meters produced; these data have
provided conversion factors for calculating approxi-
mate textile capacity from the chemical fiber output.
Given variances in width, weight, and fineness of
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Fiber
Average US
Factors,
Calculated
Factor for
1972-77 a
PRC Fabrics
Cotton
4,596
4,562
Acrylic
2,137 a
4,390
Vinylon (nylon)
5,826
6,625
Polyester
9,898
10,325
Cellulosics
4,758
4,562
a Average from statistics in US Department of Commerce, Bureau of
the Census, Average Weight and Width of Broadwoven Fabrics
(Gray), November 1977. Chinese acrylics are probably measured in
linear-meter equivalents which average one-half the width of US
acrylics.
feedstocks to new vinylon plants, will prevent signifi-
weight fabrics which, coupled with delays in providing
cotton, silk, or other synthetics. The textile ministry is
concentrating on polyester to meet the need for light-
yield up to 1.3 billion meters of cloth, of which an
estimated 330 million meters is not blended with
Vinylon (polyvinyl alcohol) fabrics are primarily used
for utility garments, but some vinylon blends are
made into lightweight apparel. China has an estimat-
ed 200,000 tons of annual vinylon capacity which can
cant expansion of vinylon.
Cellulosics-rayon and acetate-are used in pure and
blended textiles largely for apparel. Rayon also is
used in making tire cord and conveyor belts. Apparel-
grade textile production probably reached 325 million
meters in 1980, with additional fiber used in blends.
Expansion of cellulosic capacity is limited by scarcity
of suitable raw materials. By 1985 another 60 meters
of capacity for apparel-grade rayon and acetate are
expected to be on line.
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Appendix C
Wool, Silk, and Other Fibers
Wool
Wools include sheep's wool, mohair, cashmere, camel
hair, yak, and other animal fibers. Acrylic yarns are
blended with wool and may account for as much as
one-half the raw materials used to produce wool
textiles in China.
In 1978 China's wool industry included 157 plants
with 478,000 spindles. About 60,000 new spindles
were added in both 1979 and 1980 and 90,000 in
1981. China has built several new plants including
large and medium-sized facilities in Xinjiang,
Qinghai, and Henan. Foreign investors have helped
open new plants in Guangdong, Xinjiang, and Inner
Mongolia; the output of these plants may not be
included in the national production statistics.I
Years Sheep Inventory Wool Output
Beginning of Year (thousand Kilogram
(millions) metric tons) Per Sheep
Future production of wool will depend mainly on
expansion of herds, increase in weaving and knitting
capacity, and improvement in raw wool output and
spindle productivity. The herds increased at about 2.5
percent per year through the 1970s, and wool output
at about 3.4 percent. In addition, imports have ac-
counted for about 10 percent of total wool supply. If
these rates can be sustained and if processing capacity
can catch up, China's output of wool textiles should
increase by 12 to 13 percent annually through 1985.
F__ I
There are few complete data on domestic production
of wool, and the statistics available do not indicate
whether they include fibers other than sheep's wool.
Late 1970s data on China's sheep inventory and wool
output correlate strongly (see table C-1), but the
average output per head is low when compared to the
1950's average of 1.1 kilograms. China's wool produc-
tivity is the lowest among major wool-producing
countries, but new breeding programs will help in-
crease output. Beijing claimed in 1981 that a new
breed of sheep yields 6 to 7 kilograms of wool.
China has published data on its woolen fabric produc-
tion, including both natural and synthetic wools. One
textile official claimed average woolens output of 2.5
million meters per 10,000 spindles, but available data
suggest a lower average rate of about 1.7 million
meters in recent years (see table C-2). It is possible
that spinnin mills are operating at about 70 percent
of capacity. China's total
weaving and nitting capacity was about one-half its
natural and synthetic wool yarn spinning capacity in
1979. Indeed, the textile ministry is seeking to enlarge
China's fabric-producing capacity to correspond more
closely with yarn output.
Silk
Silks are traditionally "the Chinese textile," but they
only account for a small share of the total textile
industry. The textile industry has been trying to
improve the productivity and quality of its silk indus-
n
try, particularly after a record incriose in silk coc
production in 1980 (see table C-3).
Few industrywide statistics on silk production are
available; instead most Chinese press items on silk
discuss local cocoon production or improvements at
local silk mills. The high export value of silks has
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Years Raw Silk Silk and Satin Fabrics
(metric tons) (million meters)
1977 26,900 529
1978 29,690 610
1979 29,749 664
1980 35,400 759
1981 35,900 820
prompted many localities and regions to expand mul-
berry acreage for silkworms. Advanced plants are
installing automatic reeling machines, wider looms,
jacquard looms, and quality improvement programs to
increase productivity.
The PRC's production of raw silk has increased 7.5
percent annually since 1977, whereas fabric output
has expanded at an 11.6-percent rate. The disparity is
due in part to a sharp decline in the share of raw silk
exported in 1980. The 1981 export level was also low,
leaving more raw materials for domestic textile pro-
duction in those years. Cocoon yield per hectare has
increased rapidly since 1976 but will probabl row
more slowly in the 1980s.
Because the growth rate of raw silk production is
constrained by increases in mulberry acreage and
environmental factors, output will not rise sharply in
the 1980s. Silk production will probably reach 44,000
tons by 1985, with fabric production slightly exceed-
ing 1 billion meters.
Other Fibers
China also produces bast fibers such as hemp, jute,
flax, and ramie. In 1979 hemp was listed by the
Chinese among the top five fibers, but it is not a
major apparel fiber. Bast fibers are generally used for
cordage, gunny bags, carpet and upholstery backings,
and tarpaulins. Polypropylene has been introduced as
a substitute for bast fibers in the manufacture of bags
for packaging. In 1981 China made about 400 million
polypropylene bas and 428 million traditional gunny
bags.
Flax is used in linen production, which does enter the
apparel sector, but no information is available on the
magnitude of production. Ramie is used, especially
blended with cotton and polyester, in textiles primar-
ily for domestic consumption. A new plant that
opened in late 1981 in Hunan Province will produce
9.5 million meters a year of ramie and ramie-blend
fabrics. The largest known bast fiber textile mill is at
Guangzhou (Canton) and produces about 30 million
meters of ramie and ramie-blend fabrics annually.
Bast textile production is probably in the 100-million-
meter-per-year range, with most output going to
industrial uses. Although bast fiber production may
increase slightly by 1985, it will have little impact on
China's apparel-grade textile capacity
25X1
25,
25
25
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Appendix D
Value of China's Textile Trade
261
Silk
132,092
211,085
262
Wool and other animal hair
40,382
218,805
263
Cotton
59,972
15,280
264
Jute
154
16,199
265
Vegetable fibers, excluding cotton and jute
12,233
22,850
266
Synthetic fibers and regenerated fibers
56
265
267
Other manmade fibers
106
542
651
Textile yarn and thread
6511
Thrown silk and other silk yarn and thread
43,771
86,946
6512
Yarn of wool and animal hair
334
8,240
6513
Cotton yarn, not mercerized, unbleached, not retail
36,883
156,444
6514
Cotton yarn and thread, bleached, dyed, mercerized
24,976
36,383
6515
Yarn and thread of flax, ramie, and true hemp
276
420
6516
Yarn and thread of synthetic fibers
9,704
43,463
6517
Yarn and thread of regenerated fibers
12,201
50,710
6519
Yarn of textile fibers, NES
101
2,541
652
Woven cotton fabrics
6521
Cotton fabrics, woven, unbleached, not mercerized
233,928
464,344
6522
Cotton fabrics, woven, bleached, dyed, mercerized
204,605
429,459
653
Woven textile fabrics, other than cotton fabric
6531
Silk fabrics, woven
112,534
267,638
6532
Woolen fabrics, woven
5,744
71,579
6533
Woven linen, ramie, and true hemp fabrics
260
810
6534
Woven fabrics of jute
93
3,224
6535
Woven fabrics of synthetic fibers
30,371
193,410
6536
Woven fabrics of regenerated fibers
28,173
70,997
6537
Knitted or crocheted fabric, not elastic or rubberized
570
7,951
6538
Woven fabrics of glass fiber
135
316
6539
Woven fabrics, NES
2,125
5,341
6540
Tulle, lace, embroidery, ribbons, trimmings
5,646
39,334
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SITC a
Description
1975
1980
655
Special textile fabrics and related products
6551
Felt and articles of felt, NES
727
1,200
6554
Coated or impregnated textile fabrics and products, NES
318
1,339
6555
Elastic fabrics and trimmings of elastic
205
1,921
6556
Cordage, cables, ropes, twines, and manufactures
7,989
28,920
6557
Hat bodies
6,772
24,601
6558
Wadding, wicks, and textile fabrics for industrial use
963
2,049
6559
Special products of textile and related materials
798
1,132
656
Made-up art, mainly of textile materials, NES
6561
Sacks and bags of textile materials
10,012
64,867
6562
Tarpaulins, sails, awnings, sunblinds, tents
391
1,166
6566
Blankets, traveling rugs and coverlets
20,638
46,212
6569
Made-up articles of textile materials, NES
169,118
516,101
657
Floor coverings, tapestries, and so forth
62,868
272,647
841
Clothing
8411
Clothing of textile fabric, not knitted or crocheted
152,657
885,978
8412
Textile clothing accessories, not knitted or crocheted
34,604
120,179
8413
Apparel and clothing accessories of leather
22,952
152,135
8414
Clothing and accessories, knitted or crocheted
123,538
470,652
8415
Headgear
8,738
21,392
8416
Articles of clothing made of rubber
898
7,640
8420
Fur clothing and other articles made of furskins
10,109
68,468
a Commodities are categorized by the Standard International Trade
Classification, Revised. For a more complete description of commod-
ities included in each SITC category, see: United Nations, Statisti-
cal Office, Commodity Indexes for the Standard International
Trade Classification, Revised, Series M, No. 38, Vols. I and II, New
York, 1963.
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262
Wool and other animal hair
10,178
138,559
263
Cotton
284,697
1,482,132
264
Jute
0
22,278
265
Vegetable fibers, excluding cotton and jute
7,747
2,808
266
Synthetic fibers and regenerated fibers
92,258
500,311
267
Other manmade fibers
27
209
651
Textile yarn and thread
6511
Thrown silk and other silk yarn and thread
69
589
6512
Yarn of wool and animal hair
47
96,249
6513
Cotton yarn, not mercerized, unbleached, not retail
1,366
25,212
6514
Cotton yarn and thread, bleached, dyed, mercerized, and so forth
1,782
2,988
6515
Yarn and thread of flax, ramie, and true hemp
88
60
6516
Yarn and thread of synthetic fibers
31,318
244,426
6517
Yarn and thread of regenerated fibers
12,020
45,512
6519
Yarn of textile fibers, NES
78
2,981
652
Woven, cotton fabrics
6521
Cotton fabrics, woven, unbleached, not mercerized
653
Woven textile fabrics, other than cotton fabric
6531
Silk fabrics, woven
193
2,609
6532
Woolen fabrics, woven
29
1,289
6533
Woven linen, ramie, and true hemp fabrics
2,096
13,117
6534
Woven fabrics of jute
1,056
869
6535
Woven fabrics of synthetic fibers
29,800
238,760
6536
Woven fabrics of regenerated fibers
51
4,924
6537
Knitted or crocheted fabric, not elastic or rubberized
245
39,362
6538
Woven fabrics of glass fiber
21
35
6539
Fabrics, woven, NES
8
176
6540
Tulle, lace, embroidery, ribbons, trimmings
137
7,805
655
Special textile fabrics and related products
6551
Felt and articles of felt, NES
30
654
6554
Coated or impregnated textile fabrics and products, NES
3,581
27,863
6555
Elastic fabrics and trimmings of elastic
9
2,230
6556
Cordage, cables, ropes, twines, and manufactures
51
873
6557
Hat bodies
0
8
6558
Wadding, wicks, and textile fabrics for industrial use
357
14,302
6559
Special products of textile and related materials
28
247
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Table D-2 (Continued)
656
Made-up articles, mainly of textile materials, NES
6561
Sacks and bags of textile materials
1,878
4,415
6562
Tarpaulins, sails, awnings, sunblinds, tents
1
55
6566
Blankets, traveling rugs, and coverlets
9
75
6569
Made-up articles of textile materials, NES
573
5,055
657
Floor coverings, tapestries, and so forth
140
877
841
Clothing
8411
Clothing of textile fabric, not knitted or crocheted
88
2,641
8412
Textile clothing accessories, not knitted or crocheted
18
3,598
8413
Apparel and clothing accessories of leather
5
2,340
8414
Clothing and accessories, knitted or crocheted
58
11,706
8415
Headgear
43
357
8416
Articles of clothing made of rubber
1
86
a Commodities are categorized by the Standard International Trade
Classification, Revised. For a more complete description of commod-
ities included in each SITC category, see: United Nations, Statisti-
cal Office, Commodity Indexes for the Standard International
Trade Class cation, Revised. Series M. No. 38, Vols. I and II, New
York.
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