VNDIRECT RESEARCH
Analyst(s):
TEXTILE & GARMENT: PASSING THROUGH HEADWINDS
Hao Nguyen Duc
Vietnam texttile & garment snapshot in 2021
Hao.nguyenduc@vndirect.com.vn
Vietnam’s textiles and garments export value In 3Q21, the garment and textile export turnover hit hard by Covid-19. As a result, fabrics and garments export value in 3Q21 decreased by 4.6% yoy to US$8.3bn. In which fabric exports reached US$618m, accounting for 7.4% of the total T&G export turnover (+30.3% yoy). Overall, the total export T&G value in 10M21 increased by 10.8% yoy to US$32.0bn, fulfilling 84.2% of the Vietnam government's guidance for 2021F (US$39bn).
Sources: MOIT, VNDIRECT RESEARCH
Vietnam’s fiber and yarn export value Yarn export value was not affected by Covid-19 as that does not require much labour. Furthermore, yarn prices in 3Q21 soared by 20.8% yoy thanks to the depletion of yarn inventories in China by the electric shortage in Aug-21 and Sep-21, causing increased demand for yarn outside China. As a result, yarn and fibres export turnover soared by 56.3% yoy to US$1,46bn. Notably, Vietnam's polyester yarn export value in 9M21 recorded at US$300m (+30.0% yoy).
Sources: MOIT, VNDIRECT RESEARCH
T&G export destination in 9M21 According to (GDVC), regarding the export mix by geographic regions in 9M21, the US remained the largest importer of Vietnam T&G products with an import value of US$12.0bn (+13.2% yoy, accounting for 41.3% of Vietnam's textile and garment exporting value). 9M21 exporting to E.U. and China markets reached at US$2.9bn (+3.5% yoy) and US$3.4bn (+30.7% yoy), respectively. Whereas, exporting to Japan markets declined by 9.9% yoy to US$2.5bn in 9M21. Sources: GDVC, VNDIRECT RESEARCH
Vietnam’s yarn, textile and garment import value According to MOIT, the total import value of T&G in 3Q21 recorded at US$3.8bn (+8.1% yoy) thanks to the low base in 3Q20 (most T&G companies affected by Coivd-19 in 2020). China is still the main import market of Vietnam, accounting for 52.0% of T&G import value. We expect Vietnam's T&G import turnover to maintain the growth momentum in 4Q21-22F as traditional orders will rebound in 2022F thanks to the rapid vaccination rollout in Vietnam's main export markets. Sources: MOIT, VNDIRECT RESEARCH
Based on our estimate, 3Q21 aggregated revenue of listed T&G companies decreased by 4.8% yoy under the impact of Covid-19 stricter lockdown during www.vndirect.com.vn
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