Exports continued to surge in November, with cumulative export value exceeding the full-year total of last year — China Lighting Industry Export Bulletin, November 2020
Source: 中国之光网|| Views: 1348
Author/Wen Qidong
China Association of Lighting Industry（中国照明电器协会）
In November 2020, the export value of China's lighting industry reached US$5.863 billion, setting a new monthly record for this year, with a year-on-year (YoY) increase of 40.44%, achieving double-digit growth for six consecutive months since June. Among them, the export value of LED lighting products reached USD 4.168 billion, with a year-on-year (YoY) growth of 45.33%. Positive growth has been achieved for seven consecutive months since May, setting not only the highest monthly export record for 2020 but also recording the largest YoY increase for any single month this year. The growth in luminaires and accessories was particularly remarkable.
Monthly breakdown shows that exports were basically stable in January before the outbreak of the pandemic; February was the most severe period of the domestic epidemic, with production and supply chains facing significant obstacles, characterized by orders but difficulties in delivery, causing data to hit rock bottom; in March, as the domestic epidemic stabilized, enterprises gradually resumed work and production, leading to an improvement, with a clear rebound in overall lighting exports; from April to May, production and supply chains further recovered, and previously backlogged orders entered the execution and release phase, thus narrowing the decline further; subsequently, as the overseas epidemic spread, Chinese factories that quickly recovered from the epidemic further highlighted their production and supply chain advantages, greatly compensating for the global supply gap caused by the pandemic, achieving double-digit growth for three consecutive months from June to August; and as the substitution and transfer effect continued to amplify, the share of Chinese manufacturing in global exports further increased, with exports in the three recent months from September to November all achieving substantial growth exceeding 40%.
From January to November 2020, the cumulative export value of China's entire lighting industry reached USD 46.238 billion, a Year-on-year (YoY) increase of 11.99%, surpassing the full-year 2019 figure of USD 45.438 billion. From January to November, the cumulative export value of LED lighting products reached USD 31.128 billion, a year-on-year (YoY) increase of 12.83%, surpassing last year's full-year total of USD 30.157 billion.
According to data from the General Administration of Customs, China's goods trade Export value in November was RMB 1.79 trillion, a Year-on-year (YoY) increase of 14.9%, marking the highest growth rate in nearly 20 months since last March; measured in US dollars, it reached USD 268.1 billion, with a Year-on-year (YoY) increase of 21.1%, the highest growth rate in nearly 33 months since February 2018. From January to November, the cumulative total Export value of China's goods trade was RMB 16.1 trillion, a Year-on-year (YoY) increase of 3.7%, achieving positive growth for four consecutive months; measured in US dollars, it was USD 2.31 trillion, a Year-on-year (YoY) increase of 2.5%. China's foreign trade Export has achieved positive growth for six consecutive months, with the trade surplus reaching USD 75.42 billion, setting the highest record since the compilation of this data began in January 1981. Meanwhile, our lighting industry Export has outperformed the overall market for five consecutive months since July.
In November, lighting exports not only continued the strong growth momentum seen since the second half of the year but also set a new record for monthly export value. The overseas pandemic situation remains severe with resurgences in many countries; therefore, exports of epidemic-prevention and stay-at-home economy-related products, such as scientific research and medical lamps, UV lamps, and horticultural lighting products, maintained their growth trend. Markets in North America and Asia-Pacific are gradually recovering, leading to further marginal improvement in external demand and relatively stable new order volumes. The "substitution and transfer effect" of China's exports to other countries continues to amplify, further consolidating and increasing its share in the global export market. In the first eleven months of this year, the cumulative export value of the lighting industry has already exceeded the total for the entire previous year, achieving nearly 12% growth. Currently, both supply and demand in lighting exports are robust. Based on this, combined with the orders on hand reported by relevant exporting enterprises, it is imminent that the annual total export value will surpass USD 50 billion, significantly raising the historical high record for China's lighting exports.
While exports continue to hit new highs, attention must also be paid to the practical difficulties faced by export enterprises recently, especially since the fourth quarter. These include: 1. Pricing Issues:
Price competition remains intense, further squeezing profit margins. In particular, for LED light source products, as shown in the chart above, their average export price has been accelerating downward, especially since the second half of the year. Meanwhile, with the rise in prices of fluorescent lamp products this year, a reversal in average export prices between these two categories has even occurred. indicates that some companies, when facing the challenges of the pandemic and industry competition, have sacrificed profits to seize market share or simply to survive. 2. Exchange rate issues: Significant fluctuations in exchange rates have caused the USD/CNY rate to drop sharply from previously breaking above 7 to around 6.5, severely impacting the profits of export enterprises. 3. Supply chain issues: Soaring international commodity prices, coupled with the concentration of manufacturing in China, have led to significant price increases and shortages of raw materials and components such as copper-clad laminates, aluminum substrates, IC chips, MOS transistors, and passive components. This has placed considerable pressure on the production and profits of related export enterprises. 4. Logistics Issues: Also influenced by the further expansion of global demand for Chinese products due to the pandemic, since the fourth quarter, price hikes, space shortages, and container deficits in the shipping industry have become widespread. The ability to produce goods but not ship them has become another major challenge faced by export enterprises recently. 5. Energy Issues: Recently, due to the abnormally cold winter caused by La Niña and the recovery and boom of the manufacturing industry, some southern provinces such as Jiangxi, Hunan, and Zhejiang have experienced power outages and restrictions due to tight electricity supply or to meet energy saving targets, which has had a certain impact on the production capacity of some lighting manufacturing enterprises.
Summary
Despite the rampant pandemic this year, lighting exports still achieved encouraging figures. While this is commendable, it is necessary to pay attention to current difficulties and make plans and preparations for next year. Looking ahead to lighting exports in 2021: first, the sustainability of high growth and substitution effects for epidemic prevention and stay-at-home economy products remains to be observed; second, spillover risks still exist in the lighting supply chain, as the global supply chain may evolve from solely pursuing efficiency and cost-effectiveness to prioritizing supply chain security in the post-pandemic era. The superposition of various uncertainties makes corporate decision-making and planning extremely difficult. With the global pandemic threat still present, restoring global mobility for both people and goods remains a long and arduous journey. As the saying goes, "The pass is formidable like iron, but now we stride forward from the beginning."
