The Rupp Report: The 17th Shanghaitex

The 17th Shanghaitex was organized by Adsale Exhibition Services Ltd., Shanghai Textile Technology Service & Exhibition Center and Shanghai International Exhibition Co. Ltd. It took place June 15-18, 2015, at the Shanghai New International Expo Center. The show is sponsored by ShangTex Holding Co. Ltd., China Council for the Promotion of International Trade Shanghai Sub-council and China Chamber of International Commerce Shanghai Chamber of Commerce.

For years, China’s economy has soared with double-digit growth. However, over the past two years, the Chinese economy showed a very slight drop. So-called experts from the West predicted a crisis for China, although this didn’t bother the government very much.
 
Transformation
Slowly, upon the request of the government to have more stable and sustainable growth, Chinese products are coming closer to meeting international standards. Additionally, it was the plan of the Chinese leaders to support the domestic industry to a larger extent. And that happened too. Therefore, it was going to be very interesting to see how Shanghaitex would turn out given this somewhat unusual economic climate.
 
Even the organizers of the show said: “China’s textile and garment industry has entered the phase of transformation and upgrade. Rising labor costs is becoming a tremendous challenge for the industry, which is intensive in labor. Applying new technology to improve the industry’s productivity, improving product quality and exploring new markets will be the key factors affecting companies’ long-term development.”
 
The Event
Unfortunately, the weather in Shanghai was not very favorable for the event. Pouring rain for almost the whole show bothered visitors, including foreign visitors. Shanghai’s airport had to cancel more than 200 flights due to heavy rain on Wednesday.
 
To inform its readers about the general outcome of the exhibition, The Rupp Report interviewed more than 10 European exhibitors to gather their impressions of the four-day show. Unanimously, all executives were happy with the show. Of course, more than 90 percent of the visitors came from mainland China. However, some foreign visitors — mainly from India, Pakistan, and Bangladesh — also were welcomed. Overall, there were fewer visitors, but, so reported many questioned people, the quality of the visitors was much better. “No tourists or brochure collectors,” replied many exhibitors.
 
The question “Did you recognize a difference between the last ITMA Asia and this Shanghaitex?,” was answered very clearly. Everybody said that ITMA Asia attracts more international and larger numbers of visitors than Shanghaitex, and that Shanghaitex is becoming more of a local event. On top of that, some also said that ITMA Asia is much better organized than Shanghaitex; and this event is kind of a contact platform, but nothing more.
 
Most Important Market
Despite rumors of  “shrinking Chinese economy,” Asia in general, and China in particular, are still the most important markets for the global textile machinery industry. The interviewed manufacturers judged the importance of Asia up to 70 to 75 percent, and some 10 to 15 percent is going to Europe, if Turkey is included in this market region and the balance is “the rest of the world.” However, some other Asian countries such as India, Indonesia, and particularly Vietnam as one of the most promising markets, but also Korea and Thailand were mentioned. One thing should not be forgotten, said some machinery producers, the Chinese market is guided by semi state-owned companies, while the Indian textile manufacturers are usually private companies
 
The changing market environment for China with regards to labor and energy costs influences the Chinese market heavily. However, thanks to its sheer size, China is still the most important market. In a scale of 1 to 10, all interviewed exhibitors said China is on top with a rank of between 8 and 10. Though, said many Europeans, because of the still positive economy, for some regional service centers of the European suppliers, it is no easy feat to find qualified employees on the Chinese job market.
 
Changing Business Environment
That some Chinese manufacturers already have reacted to the new conditions, was mentioned more than one time. They invest now heavily in foreign countries to get cheaper labor costs and to stay competitive on the global market. Also, the main focus is changing. It is very well known that China is by far the largest man-made fiber producer in the world and much more capacities are on the way to be installed. On the other hand, there are still many millions of tons of cotton in stock. Most of the questioned people were convinced that, in the near future, man-made fibers will play a more important role for the Chinese textile industry than the more expensive cotton fiber.
 
The Future
“Does the market need a show in China every year, like ITMA Asia and Shanghaitex?,” was one of the key questions asked by the Rupp Report. Surprisingly, even Chinese people said no to this. One event every two years would be more than sufficient. In this context, it was very interesting to note that none of the big producers of weaving machines was present at Shanghaitex — none.
 
However, all are expecting a good year in 2015. “China is investing,” said one person, “not in capacity, but in quality.” Despite the fact that India is gaining ground and some other neighbor countries too, everybody is convinced that the strength, purchasing and producing power of China will stay for many years to come. More detailed information about ShanghaiTex will come in a future Rupp Report. By the way, ITMA Asia was an issue that was very much a focus of attention. But that’s another story to be reported on very soon.

June 23, 2015