In the 1960s, South Korea’s textile industry developed rapidly to meet domestic demand with its low-cost advantage. By the mid-1990s, the technical level of spinning, weaving, printing and dyeing, design, garment production, and textile machinery manufacturing had become world-leading. First-class, export-oriented at this time, has gradually been recognized by many countries for its innovative attitude, high value-added and private brand products. In the past ten years, the Korean textile industry, especially the cotton textile industry, has encountered challenges from Asian countries represented by China. They are adjusting innovative industries to produce high-quality differentiated products, making the cotton textile industry not only popular in Korea The importance of adhering to and participating in the competition for outward development cannot be ignored. The Korean cotton textile industry has the desire to strengthen ties with the Chinese cotton textile industry. Seven years ago, the cotton textile industry associations of both sides started annual exchanges of visits in collaboration with enterprises. They believe that China has abundant cotton resources and a vast market, and any fluctuations in cotton will affect the profits and losses of its companies, while South Korea has relatively advanced technology and investment experience. Mutual exchange of information will help both parties understand and progress.
Production status of Korean cotton textile industry
In the past six years, South Korea’s cotton textile equipment has basically been around 1.2 million spindles. In 2009, there were approximately 1.14 million spindles. In 2010, with cotton textile companies around the world making money, South Korea also began to increase investment, and spinning equipment increased accordingly. At the end of 2012, the number of cotton spinning spindles reached more than 1.3 million. In 2014, due to the economic downturn, some companies closed due to operating difficulties, and the spinning spindles dropped to the current level of approximately 1.22 million spindles. For this reason, yarn production in South Korea has also declined.
The equipment level of South Korea’s cotton textile industry is also uneven. The average level is slightly higher than China’s average level, but the absolute number of high-level equipment is much less than that of China. After all, South Korea only has a production capacity of more than 1 million spindles. This is evident from the fact that South Korea employs an average of 30 people per 10,000 ingots. South Korea’s spinning equipment involves ring spinning, OE spinning and vortex spinning, with ring spinning accounting for 90% of the mainstream.
The larger spinning companies in South Korea are equipped with dyeing plants. Banwol Industrial Park, not far from Seoul, has more than 100 large and small dyeing factories, mainly dyeing pure cotton yarn, and some printing and dyeing; while Daegu mainly dyes blended yarn and chemical fiber yarn, which can also be regarded as an industrial cluster. , more than 50% of the yarn is imported. Unlike China, South Korea has a large amount of skein dyeing. Due to labor shortages, some companies use about 15% of migrant workers. The average age of local employees is basically over 40 years old, but it is very stable.
Import and export status of Korean cotton textiles
In 2000, South Korea’s textile and apparel industry was one of the important industries in South Korea, accounting for 8% of the gross national product, and the number of people engaged in the textile industry accounted for 19% of the total industrial employees; according to United Nations statistics, in 2001 South Korea’s textile industry The export value was US$15.3 billion, with a market share of 4.4%. With the changes in economic development trends, South Korea’s textile export methods have undergone major changes.
According to data provided by the Korea International Trade Association, South Korea’s exports of needle cotton products in 2014 were US$880 million, a year-on-year decrease of 5.6%, of which exports to China were US$190 million, a year-on-year decrease of 15.5%; South Korea’s needle cotton products It has great competitiveness and imports are very small, only 10 million US dollars, a year-on-year decrease of 0.85%. Although South Korea’s textile exports to China decreased, its exports of clothing to Southeast Asia increased. Therefore, South Korea’s total textile exports remained flat. From an import perspective, South Korea imported less fiber and yarn, while outsourced clothing processing was imported from Southeast Asia. Therefore, imports are increasing year-on-year. What deserves China’s attention is that Vietnam has replaced China as South Korea’s largest import and export country.
The impact of South Korea’s policy orientation on textiles
By comparing the wage costs of the cotton textile industry in South Korea and China, we found a very intriguing point, the vitality of high wages and labor productivity. Since 2008, affected by the world financial crisis, the minimum wage increase in South Korea has decreased year by year from 2008 to 2010. Since 2011, the minimum wage has begun to rise, from US$3.9 per hour to US$5 per hour in 2015. In fact, textile companies Workers’ wages are more than double the minimum wage, which is more than $2,000 a month. The electricity cost has risen from US$0.07/kWh to US$0.09/kWh, which has put pressure on the operations of cotton textile companies.
South Korea actively responds to greenhouse gas emission reductions and has something to learn from in promoting low-carbon green growth. The emissions of large enterprises in South Korea account for more than 70% of the country’s total emissions. Therefore, the government has set energy conservation and emission reduction targets for 525 large enterprises, as well as an effective supervision system. It has also established a quota trading mechanism. All emissions exceeding the quota are Yes, you must buy indicators on the trading market. As a result, Korean textile companies, especially those involved in dyeing, have increased the cost of purchasing emission rights, causing manufacturing costs to rise.
Korea cotton textile development trends
The consumption of textiles in South Korea is increasing year by year. Home textilesIn the late 1960s, South Korea’s original designer PARKHONGGEUN established the PARKHONGGEUN brand in South Korea after receiving education in Western culture. His works set off an uproar in South Korea. Since then, bedding has become an interior decoration, and the brand is also the first bedding brand to use its name. Today’s PARKHONGGEUN has become the representative of “famous wedding and gift products”. During the delegation’s visit to South Korea, they witnessed with their own eyes the PARKHONGGEUN four-piece set of pure cotton bedding set on TV. 8,700 sets of bedding sets were sold within 40 minutes. This is unimaginable in China, and one cannot help but admire its ingenuity. Promotional methods, PARKHONGGEUN’s quality, price, design and brand bring South Korea’s consumption concept to the extreme. Clothing consumption in South Korea is also very extensive. Seoul’s Dongdaemun Market welcomes millions of tourists every year, many of whom are from China. The number of Chinese tourists to South Korea has reached more than 6 million every year. It is reported that it will receive tourists from China in 2018. There are 10 million guests, which will account for one-fifth of South Korea’s total population. The upward trend is sharp, driving South Korea’s consumption to a certain extent.
According to the Korea Cotton Textile Association, Korean cotton textile companies have basically got out of trouble. As Vietnam’s domestic demand increases and it joins the TPP, Korean cotton textiles will increase investment in Vietnam, which is expected to reach 400,000 spindles by the end of 2015. Accounting for one-third of South Korea’s mainland. In addition, South Korea will speed up the elimination of old equipment and does not plan to add new equipment locally.
The Korea Cotton Textile Association believes that China’s cotton policies will have a significant impact on international cotton prices, such as China’s 11 million tons of cotton reserves that South Korea will not be able to use up in 30 years, China’s cotton subsidy policy, and China’s cotton import quotas The quantity is the focus of Korean companies. They said that what kind of cotton policy China will adopt is also crucial to whether its companies can make profits.
