Packaging / Advertising & Office

Watson & Band Import and Export Data Observation reports that in July, August and September 2022, the printing and packaging industry has experienced the lowest third quarter in 40 years. However, we are about to usher in the National Day Golden Week, the 20th National Congress and the Double Eleven Shopping Carnival. Under the favorable conditions of the "two festivals and one meeting", the printing and packaging market may usher in a recovery, and I hope this crippling downturn will soon begin. Finish.

In the third quarter of this year, orders from a large number of companies in the printing and packaging industry fell by 30-40%, and there were not a few companies that halved their orders. Packaging orders are ultimately connected to domestic consumption and export trade, and the decline of the cliff means that at least one of the two must have major problems.

So, what caused such a terrifying disappearance of orders? Let's break it down one by one:

First, let's talk about domestic demand. According to Huacheng Import and Export Data Observation report, in the first half of the year, the per capita disposable income of the national residents was 18,463 yuan, a year-on-year increase of 4.7%, a real increase of 3.0% after deducting the price factor. From January to August, the total retail sales of consumer goods in China was 28.256 trillion yuan, a year-on-year increase of 0.5%. Judging from this data, the income and consumption power of Chinese residents are very stable and excellent. See the signs of domestic consumption cliffs.

Let's look at the export data again. According to import and export data, the volume of imported boxes in the United States from January to August is still at a high level in 2021, and even increased slightly. Compared with August 2019 before the epidemic, the volume of imported boxes in the United States in August this year increased by 18%; the volume of imported boxes in July increased by 15% compared with that before the epidemic. It shows that Americans have not been affected by the historical hyperinflation (domestic media reports), and are still buying and buying like crazy. This point, from my country's export data has also been reflected.

In addition, U.S. container imports from China in August increased by 1.4% from July 2022 to 1.0085 million TEU, an increase of 6.3% from the same period in 2021. It means that the volume of American boxes imported from China in August hit a record high. This also dispelled the domestic rumors that a large number of orders will be transferred after the closure of Shanghai.

Domestic demand and exports have remained stable at historical highs, and they are still improving. Why is the order in the printing and packaging industry so miserable? Are the packagers lying collectively, or are they data deceiving?

According to the import and export data observation report, as a packaging person, I have visited many factories recently, and I have heard and heard about it, which can prove that the orders of packaging and printing enterprises have fallen off a cliff. Nine Dragons experienced large-scale shutdowns in January, March, June, August, and September of 2022, and the shortage of orders tends to be serious. Machines are generally idle in factories, and there are many factories where two shifts are replaced by one shift. The sales data of raw and auxiliary materials traders are also appalling...

In this way, the data on domestic demand and export is really terrifying!

Think about domestic demand first. Is there any possibility of fraudulent per capita disposable income and total social zero? In fact, many industries have fallen into recession this year, the income of migrant workers is shrinking at a rate visible to the naked eye, and a large number of people have been thrown into the ranks of the unemployed. Even government workers and state-owned enterprises and institutions have occasionally reported falling incomes. Therefore, in the first half of the year, the per capita disposable income of national residents was 18,463 yuan and the data increased by 4.7% year-on-year, which should not be too small.

In fact, with a little cognition, it is not difficult to find that domestic data often fights. Taking 2021 as an example, import and export data show that the disposable income of national residents was 49.6 trillion yuan last year. However, Bao Xiaobian also found that the total retail sales of the company exceeded 40 trillion yuan last year, and the sales of commercial housing exceeded 18 trillion yuan last year. These two add up to 58 trillion, is there 8.4 trillion people are in debt consumption?

Obviously not. The central bank's data shows that the balance of household loans in the first half of the year increased by 2.18 trillion yuan, a year-on-year decrease of 2.39 trillion yuan; in the first half of the year, RMB deposits increased by 18.82 trillion yuan, a year-on-year increase of 4.77 trillion yuan. It seems that many residents did not use their disposable income for consumption, but deposited 19 trillion in the bank. This data is fighting against social zero growth again. In short, the domestic consumption data is definitely more and more confusing. But what is certain is that in the first half of the year, the per capita disposable income did not increase, nor did the total social zero increase, and even the savings of ordinary people could not increase.

Compared with the domestic demand data, if some foreign trade companies do not take into account the deceptive tricks such as one-day container tours, my country's customs statistics are still very transparent, because my country's exports are so good that there is no need to apply grease and powder. So why did many enterprises in the Pearl River Delta and the Yangtze River Delta have significantly reduced export orders year-on-year?

We know that there is a lag time between the data on the number of imported goods containers in the United States and the data on orders received by Chinese companies. Usually, one month of shipping by sea and one month of production after receiving orders, so the data of containers in August is basically the same as that of my country's 6 The month's export orders are linked. Therefore, the sluggish exports in July-September may be confirmed in the US import statistics for September-December.

It seems that the reason for the cliff-like decline in orders in the packaging and printing industry in the third quarter is likely to be caused by the decline in both domestic consumption and exports. After three years of the epidemic, people's livelihood has been difficult, and domestic demand has been weak. However, major customers such as the United States have withdrawn from the monetary stimulus channel and switched to the route of raising interest rates and shrinking the balance sheet. The inhibition of my country's exports is obvious.

Then, what will be the order trend of the packaging and printing industry in the next October? Let's take a look at:

Under the continuous interference of the epidemic, the October Golden Week is believed to be much weaker than last year, but the seven-day holiday can always stimulate consumption. Although the benefits are not as good as expected, they are still positive.

This year's Double Eleven shopping carnival, including e-commerce platforms and brand merchants, is probably in the dark. Under the circumstance of high cost and reduced sales volume, enterprises are not very willing to participate in the shopping spree. It is estimated that this year's Double Eleven is likely to be the worst year since 2009, but it may also be the best year in the next ten years. In short, this year's Double 11 will basically not expect too much to drive consumption.

October is actually a low season for export companies. Because the Halloween and Christmas orders in Europe and the United States are basically coming to an end. Considering that the US is still on the way to raise interest rates and shrink its balance sheet, and high inflation will force the Federal Reserve to continue to intensify its efforts, Americans may have to temporarily put aside their habit of spending extravagantly and prepare to make some economic reserves for the economic winter. It is expected that my country's export processing orders in October will show a downward trend both month-on-month and year-on-year.

On the whole, Jin Jiu is in vain, and I am afraid that Yin Shi will not be able to count on it. Everyone should be prepared for the continued downturn in orders.