China Council for the Promotion of International Trade (ccpit) 2009 Preface

Leather, Fur, Feather/Down, and Their Product Industry

1. Overall Scale and Distribution

In February 2008, there were 7,263 enterprises in leather, fur, feather and down industry, with 240,400 employees, a year-on-year growth of 4.28%. The total assets value reached 247 billion yuan, up by 19.54% on a year-on-year basis. The total indebtedness was 140.5 billion yuan, up by 17.19% on a year-on-year basis. In November 2008, there were 7,631 enterprises in leather, fur, feather and down industry, with 254,600 employees down by 0.96% year-on-year. The total assets value reached 280.8 billion yuan, up by 10.33% year-on-year. The total indebtedness was 158.9 billion yuan, up by 7.74% on a year-on-year basis.

In November 2008, the number of leather products enterprises peaked at 5,952, accounting for 78% in leather, fur, feather and down industry. Leather tanning enterprises were 785, accounting for 10.29%. Fur tanning and processing enterprises and feather/down processing enterprises were 409 and 485, respectively. Leather tanning processing employed as many as 15,300 people, accounting for 6.01%, a year-on-year decrease of 5.31%. The total assets of leather product manufacturing were the highest (201.4 billion yuan) in November, accounting for 71.72% and up by 11.39% on a year-on-year basis. The proportion of the total assets value of leather tanning processing was 17.52%, up by 9.18% on a year-on-year basis. Leather product manufacturing had a heavy debt of 111.5 billion yuan, accounting for 70.17%, up by 8.74% on a year-on-year basis. Leather tanning processing had a total debt of 28.2 billion yuan, up by 6.37% on a year-on-year basis. Fur tanning and product processing and feather/down and product manufacturing had total debts of 6.2 billion yuan and 13 billion yuan, respectively.

Figure 4 50 Scale of Leather, Fur, Feather/Down, and Their Product Industry

Unit: 10,000 persons, 100 million yuan, %

Time	Number of enterprises	Employed persons	Year-on- year increase	Total assets value	Year-on-year increase	Debt	Year-on- year increase
2007-02	6703	22.00	7.16	2084	17.17	1209	17.87
2007-05	6909	23.36	4.89	2274	14.15	1325	15.27
2007-08	7043	24.23	4.01	2454	17.02	1434	17.3
2007-11	7278	24.72	3.8	2586	18.29	1504	18.18
2008-02	7263	24.04	4.28	2470	19.54	1405	17.19
2008-05	7426	25.14	2.98	2610	16.86	1516	16.28
2008-08	7498	25.50	0.62	2737	13.62	1583	12.82
2008-11	7631	25.46	-0.96	2808	10.33	1589	7.74
Of which: Leather tanning processing	785	1.53	-5.31	492	9.18	282	6.37
Leather product manufacturing	5952	22.69	-0.75	2014	11.39	1115	8.74
Fur tanning and product manufacturing	409	0.53	0.81	107	9.8	62	5.6
Feather/down processing and product manufacturing	485	0.72	0.82	195	3.21	130	3.5

Source: China National Light Industry Council

2. Production and Sales

The total output value of leather, fur, feather and down product industry reached 70.931 billion yuan in February 2008, up by 19.15% on a year-on-year basis. The cumulative output value was 545.256 billion yuan in November, a year-on-year increase of 18.96%. The sales value of leather, fur, feather and down product industry stood at 67.212 billion yuan, a year-on-year increase of 17.24%. The cumulative sales value was 515.98 billion yuan in November, a year-on-year increase of 17.31%. The sales-output ratio of leather, fur, feather and down product industry was 94.76% in February, declining slightly to 94.63% in November. The industry made 19.11 billion yuan of manufactured products in February, up by 17.16% on a year-on-year basis, and increased to 43.623 billion yuan in November, up by 11.66% on a year-on-year basis.

The output value of the leather product manufacturing industry stood at 393.694 billion yuan in November 2008, accounting for 72.2%, and up by 20.4% on a year-on-year basis. The output value of leather tanning processing industry reached 92.185 billion yuan, accounting for 16.91%, and up by 15.06% on a year-on-year basis. The output value of the feather and down processing and product manufacturing industry was 33.814 billion yuan, accounting for 6.2%, and up by 7.86% on a year-on-year basis. The sales-output ratio of fur tanning and product manufacturing, leather tanning processing, leather product manufacturing and feather/down processing and product manufacturing were 95.85%, 92.74%, 95.02% and 94.36%, respectively. Leather product manufacturing produced a relatively large value of 16.897 billion yuan in November, up by 15.69% on a year-on-year basis. Manufactured products value of leather tanning processing, fur tanning and product manufacturing and feather/down processing and product manufacturing were 4.32 billion yuan, 1.136 billion yuan and 1.995 billion yuan, respectively.

Figure 4 51 Production and sales of leather, fur, feather and down product industry

Unit: 100 million RMB, %

Time	The cumulative output	Year-on-year increase	The cumulative sales value	Year-on-year increase	Sales-output ratio	Manufactured products	Year-on-year increase
2007-02	599.87	18.42	568.87	18.77	94.83	159.50	18.56
2007-05	1816.61	22.35	1715.25	23.22	94.42	192.00	15.67
2007-08	3222.49	22.79	3078.27	24.60	95.52	204.42	14.70
2007-11	4678.02	24.52	4477.73	25.19	95.72	224.01	22.50
2008-02	709.31	19.15	672.12	17.24	94.76	191.10	17.16
2008-05	2148.02	20.06	2025.55	19.62	94.30	223.17	15.99
2008-08	3802.59	20.04	3614.77	19.29	95.06	232.11	14.93
2008-11	5452.56	18.96	5159.80	17.31	94.63	243.49	11.66
Leather tanning processing	921.85	15.06	854.95	14.21	92.74	43.20	-2.73
Leather product manufacturing	3936.94	20.40	3740.75	18.46	95.02	168.97	15.69
Fur tanning and product manufacturing	255.63	28.45	245.03	28.33	95.85	11.36	21.34
Feather/down processing and product manufacturing	338.14	7.86	319.07	6.04	94.36	19.95	9.53

Source: China National Light Industry Council

3. Costs and expenses

The sales costs of leather, fur, feather and down product industry in February 2008 was 58.174 billion yuan, up by 16.59% on a year-on-year basis. The cumulative sales costs reached 448.794 billion yuan in November, up by 16.52% on a year-on-year basis. The sales expense in February approached 1.657 billion yuan, up by 17.05% on a year-on-year basis. The cumulative sales expense in November was 13.448 billion yuan, up by 25.91% on a year-on-year basis. In February 2008, the management expenses and financial costs of fur, feather/down and product industry were 2.829 billion yuan and 0.499 billion yuan respectively, up by 19.54% and 18.59% on a year-on-year basis. The cumulative management expenses and financial costs in November were 18.805 billion yuan and 4.026 billion yuan respectively, up by 23.75% and 29.93% on a year-on-year basis.

The sales costs of leather product manufacturing in November 2008 reached 323.85 billion yuan, accounting for 72.16% and up by 17.8% on a year-on-year basis. The sales costs of leather tanning processing was 75.573 billion yuan, accounting for 16.84% and up by 14.17%. The sales costs of feather/down product was 28.438 billion yuan, accounting for 6.34% and up by 3.15% on a year-on-year basis. The sales expense of leather product manufacturing was 10.198 billion yuan, accounting for 75.83% and up by 26.56%. The sales expense of leather tanning processing was 1.855 billion yuan, accounting for 13.79% and up by 23.92%. The sales expense of feather/down processing and product manufacturing was 0.662 billion yuan, accounting for 4.92% and up by 17.22%. In November, the cumulative management expenses and financial costs of leather product manufacturing were 25.831 billion yuan and 2.511 billion yuan respectively, accounting for 84.19% and 62.37%. The cumulative management expenses and financial costs of leather tanning processing were1.877 billion yuan and 0.895 billion yuan respectively, up by 33.79% and 30.23% on a year-on-year basis.

Figure 4 52 Costs and expenses of leather, fur, feather and down product industry

Unit: 100 million RMB, %

Time	Sales costs	Year-on-year increase	Sales expense	Year-on-year increase	Management expense	Year-on-year increase	Financial costs	Year-on-year increase
2007-02	496.45	18.29	13.89	22.19	23.56	18.21	4.39	18.66
2007-05	1500.94	21.98	37.22	22.63	63.38	22.11	11.61	17.89
2007-08	2699.33	23.64	65.35	23.39	105.71	17.83	21.71	25.31
2007-11	3907.07	23.82	93.29	22.39	151.52	16.45	31.82	23.60
2008-02	581.74	16.59	16.57	17.05	28.29	19.54	4.99	18.59
2008-05	1771.46	19.76	55.54	27.07	78.15	23.71	15.18	31.53
2008-08	3146.25	18.46	97.07	30.38	130.91	22.08	26.53	22.39
2008-11	4487.94	16.52	134.48	25.91	188.05	23.75	40.26	29.93
Leather tanning processing	755.73	14.17	18.55	23.92	18.77	33.79	8.95	30.23
Leather product manufacturing	3238.50	17.80	101.98	26.56	158.31	23.71	25.11	32.40
Fur tanning and product manufacturing	209.33	26.90	7.34	30.56	4.40	19.61	1.47	15.76
Feather/down processing and product manufacturing	284.38	3.15	6.62	17.22	6.56	4.59	4.72	21.99

Source: China National Light Industry Council

4. Profits

In February 2008, the cumulative profits of leather, fur, feather and down product industry reached 2.838 billion yuan, up by 19% on a year-on-year basis. In November, the cumulative profits were 24.714 billion yuan, up by 23.1% on a year-on-year basis. In February 2008, 1,443 enterprises or 19.87% of all the companies suffered losses. In November, the cumulative number of enterprises in the red was 1,297 or 16.76% of all the companies. Both figures were declining. In February, the total loss reached 583 million yuan, up by 39.66% on a year-on-year basis. In November, the cumulative loss stood at 1.938 billion yuan, up by 37.63% on a year-on-year basis.

In November 2008, leather product manufacturing realized the most profit of 17.055 billion yuan, up by 24.68% on a year-on-year basis. Leather tanning processing realized a profit of 4.354 billion yuan, up by 13.44% on a year-on-year basis. The profits of fur tanning and product processing and feather/down processing and product manufacturing were 2.294 billion yuan and 1.012 billion yuan, respectively. Leather product manufacturing saw relatively more loss-suffering enterprises of 976 with a scale proportion of 16.4%. Leather tanning processing had 122 loss-suffering enterprises with a scale proportion of 15.54%. The numbers of loss-suffering enterprises of fur tanning and product processing and feather/down processing and product manufacturing were 110 and 71, respectively. Leather product manufacturing enterprises suffered a relatively large amount of loss of 1.407 billion yuan, up by 32.31% on a year-on-year basis. Leather tanning processing enterprises lost 278 million yuan, up by 58.12% on a year-on-year basis. The loss of fur tanning and product manufacturing grew very fast to 80 million yuan, up by 125.28% on a year-on-year basis.

Figure 4 53 Profits of leather, fur, feather and down product industry

Unit: 100 million RMB, %

Time	The cumulative profits	Year-on-year increase	Number of loss-suffering enterprises	Percentage of loss-suffering enterprises	Enterprises’ total loss	Year-on-year increase
2007-02	22.36	25.39	1293	19.29	4.31	3.13
2007-05	73.83	32.64	1293	18.71	8.53	8.16
2007-08	138.70	32.83	1151	16.34	10.83	4.81
2007-11	203.44	33.50	1101	15.13	14.83	28.78
2008-02	28.38	19.00	1443	19.87	5.83	39.66
2008-05	83.58	12.53	1454	19.58	12.00	44.38
2008-08	164.25	20.95	1361	18.15	15.91	39.63
2008-11	247.14	23.10	1279	16.76	19.38	37.63
Leather tanning processing	43.54	13.44	122	15.54	2.78	58.12
Leather product manufacturing	170.55	24.68	976	16.40	14.70	32.31
Fur tanning and product manufacturing	22.94	38.77	71	17.36	0.80	125.28
Feather/down processing and product manufacturing	10.12	11.67	110	22.68	1.09	28.3

Source: China National Light Industry Council

5. Operation Performance

In February 2008, the product sales revenue of leather, fur, feather and down product industry grew at 17.24%, down by 1.53 percentage point on a year-on-year basis. In November, the product sales revenue grew at 17.31%, down by 7.88 percentage points on a year-on-year basis. The sales revenue of this industry was dropping down. In February 2008, the value-added ratio of capital maintenance was 122.8%, up by 6.58 percentage points on a year-on-year basis. In November, the ratio became 113.9%, down by 4.55 percentage points on a year-on-year basis. In February 2008, the asset-liability ratio of leather, fur, feather and down product industry was 56.89%, down by 1.15 percentage point on a year-on-year basis. In November, the asset-liability ratio was 56.59%, down by 1.57 percentage point on a year-on-year basis. In February 2008, the net amount growth rate of accounts receivable was 10.25%, down by 6.98 percentage points on a year-on-year basis. In November, the rate was 7.21%, down by 4.78 percentage points on a year-on-year basis. The net amount growth rate of accounts receivable was going down.

Figure 4 54 Operation performances of leather, fur, feather and down product industry

Unit: 100 million RMB, %

Time	Sales revenue Growth rate	Year-on-year increase or decrease	Value-added ratio of capital maintenance	Year-on-year increase or decrease	Asset-liability ratio	Year-on-year increase or decrease	Net amount growth rate of accounts receivable	Year-on-year increase or decrease
2007-02	18.77	-12.74	116.22	-4.54	58.04	-1.22	17.23	-4.58
2007-05	23.22	-4.74	112.63	-11.32	58.29	-0.18	10.48	-14.6
2007-08	24.60	1.13	116.63	-4.06	58.44	-0.01	14.26	-5.73
2007-11	25.19	4.05	118.45	-1.23	58.16	0.15	11.99	-6.8
2008-02	17.24	-1.53	122.8	6.58	56.89	-1.15	10.25	-6.98
2008-05	19.62	-3.60	117.67	5.04	58.10	-0.19	9.12	-1.36
2008-08	19.29	-5.31	114.74	-1.89	57.84	-0.6	9.21	-5.05
2008-11	17.31	-7.88	113.9	-4.55	56.59	-1.57	7.21	-4.78

Source: China National Light Industry Council

6. Investment in fixed assets

The cumulative investment in fixed assets of leather, fur, feather and down product industry in 2008 approached 42.45 billion yuan, up by 25.04% on a year-on-year basis. In February, the cumulative investment in fixed assets was 2.24 billion yuan, up by 41.77% on a year-on-year basis, the highest speed throughout the year. In December, the cumulative investment in fixed assets grew at 21.56% on a year-on-year basis which was the lowest throughout the year. This industry in 2008 kept a stable decrease on the whole.

Figure 4 55 Investment in fixed assets of leather, fur, feather and down product industry

Unit: 100 million RMB, %

Time	Cumulative aggregate investment amount	Amount over the same period last year	Year-on-year increase
2008-02	22.4	15.8	41.77
2008-03	56.5	44.7	26.40
2008-04	94.4	67.1	40.69
2008-05	129.5	98.2	31.87
2008-06	180.3	139.4	29.34
2008-07	222.6	172.2	29.27
2008-08	261.7	203.0	28.92
2008-09	307.7	234.1	31.44
2008-10	345.6	272.0	27.06
2008-11	388.3	304.6	27.48
2008-12	424.5	349.2	21.56

Source: China's National Bureau of Statistics

7. Production and sales by region

In 2008, Guangdong boasted 103.535 billion yuan output value of leather, fur, feather and down product, accounting for 18.99% of the industry's total output, the highest in the country, up by 18.03% on a year-on-year basis. The total output value of Zhejiang was 98.374 billion yuan, accounting for 18.04%, up by 3.07% on a year-on-year basis. The total output value of this industry was relatively large in Shandong, Hebei and Jiangsu. The total output value and sales value were small in Yunnan, Ningxia, Tibet and Guizhou. In this year, Tibet ranked the first in China in sales-output ratio of 118.64%, followed by Shaanxi, Beijing, Tianjin and Hunan. The ratio of Shanxi was 10.46% as the lowest in China. Guizhou, Tibet, Yunnan and Hainan had a relatively low sales-output ratio.

Figure 4 56 Sales-output distribution of leather, fur, feather and down product industry

Unit: 100 million RMB, %

Region	Total industrial output value			Industrial sales value			Sales-output ratio
	Actual value	Year-on-year increase	Proportion	Actual value	Year-on-year increase	Proportion	%
China	5452.56	18.96	100	5159.80	17.31	100	94.63
Beijing	7.20	9.25	0.13	7.69	10.35	0.15	106.86
Tianjin	23.38	2.23	0.43	23.45	1.97	0.45	100.33
Hebei	393.66	28.30	7.22	377.20	31.14	7.31	95.82
Shanxi	0.04	-13.75	0.00	0.01	-88.32	0.00	10.46
Inner Mongolia	9.63	124.14	0.18	9.49	139.86	0.18	98.58
Liaoning	143.33	12.23	2.63	134.80	7.35	2.61	94.05
Jilin	4.78	37.23	0.09	4.46	16.45	0.09	93.32
Heilongjiang	7.95	33.58	0.15	6.92	40.04	0.13	87.06
Shanghai	110.24	-5.80	2.02	107.14	-7.02	2.08	97.19
Jiangsu	385.92	16.36	7.08	365.40	14.89	7.08	94.68
Zhejiang	983.74	3.47	18.04	935.66	1.40	18.13	95.11
Anhui	72.52	31.21	1.33	63.47	25.25	1.23	87.53
Fujian	958.49	28.45	17.58	946.89	29.09	18.35	98.79
Jiangxi	84.44	51.14	1.55	83.92	53.68	1.63	99.39
Shandong	556.39	15.64	10.20	548.40	16.51	10.63	98.56
Henan	302.05	43.21	5.54	271.19	40.65	5.26	89.78
Hubei	16.66	21.97	0.31	14.59	26.87	0.28	87.55
Hunan	79.70	23.45	1.46	79.95	28.68	1.55	100.32
Guangdong	1035.35	18.03	18.99	940.02	13.51	18.22	90.79
Guangxi	36.29	7.68	0.67	32.38	4.06	0.63	89.23
Hainan	0.54	104.57	0.01	0.36	23.07	0.01	66.55
Chongqing	33.07	36.01	0.61	31.09	37.93	0.60	94.02
Sichuan	191.85	51.10	3.52	161.83	38.87	3.14	84.35
Guizhou	0.51	-13.90	0.01	0.32	-46.91	0.01	61.67
Yunnan	0.07	25.56	0.00	0.05	-0.88	0.00	73.46
Tibet	0.05	-16.00	0.00	0.06	-17.43	0.00	118.64
Shaanxi	1.23	20.93	0.02	1.36	15.42	0.03	110.64
Gansu	8.17	-5.13	0.15	7.55	29.81	0.15	92.34
Qinghai	0.20	6.18	0.00	0.20	12.87	0.00	100.00
Ningxia	1.54	-20.22	0.03	1.28	-9.54	0.02	82.85
Xinjiang	3.56	-7.56	0.07	2.67	5.11	0.05	75.06

Source: China National Light Industry Council

8.