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RMB Revaluation LED display export frustration?
- Sep 14, 2017 -

From the first half of the LED display industry several big listed screen enterprises in the semi-annual report, we can clearly see the 2017 overseas market growth on the domestic LED display industry, in recent years, in the "area all the way" under the construction background, as well as small spacing led stimulation, domestic screen enterprises overseas expansion of the road can be said to go more broad. But after all, it's "away combat", compared with local enterprises, domestic screen enterprises in the international market more susceptible to environmental impact, in addition to local market, economic and political environment changes, the domestic situation change will also affect the development of export screen enterprises, such as the exchange rate of the renminbi changes ... 

RMB appreciation Innovation high export enterprises are hurt 

Since July 11, the renminbi's exchange rate against the dollar has been an irresistible performance, breaking through 6.7, 6.6, 6.5 Three integer crossings, whether the appreciation of the magnitude or duration, is clearly more than the previous round of appreciation. August 30, the renminbi against the U.S. dollar exchange rate of 6.6102 yuan, continued to create a new record since August 18, 2016; On September 11, new highs continued to be refreshed: 

The data show that September 11 (Monday) USD/RMB intermediate price quoted price is 6.4997, the median price of 6.5032, the 11th consecutive day to raise. Record of the longest increase in 2005. 

For enterprises, especially foreign trade enterprises, the renminbi exchange rate should maintain a small two-way fluctuation is the best, like last year's sharp depreciation of the renminbi with the last two months this year, the same as the sharp rise in the past, whether it is a unilateral decline or unilateral rise can easily affect the enterprise. The sharp appreciation of the renminbi is undoubtedly a nightmare for many exporters holding foreign currencies. 

China's General administration of Customs September 8 announced that China's dollar-denominated August import and export data: Exports rose 5.5% Year-on-year, imports grew 13.3%, export growth has been declining for two consecutive months, and imports keep double-digit strong growth. Export growth rate decline, although the reasons for the high export base last year, but in the past two months, the renminbi has been constantly and even rapid appreciation is also an important factor affecting China's exports, especially in the export downturn as a result of import growth, but also show that the exchange rate is beginning to affect our exports. LED display industry export trade of course will also be affected by this. 

To know, domestic LED display industry export trade accounted for a large part of the LED display products exports accounted for 15%-20% of all sales. At the same time because of China's mainland LED display industry chain is very perfect, so LED display companies are mainly raw materials from domestic, denominated in renminbi, such as chip, lamp bead, box, bracket and so on, and export revenue are denominated in the U.S. dollar, in the cost of direct damage to the renminbi appreciation of the dollar 

From the industry point of view, the first half of the industry's export trade performance is good, we all know that the second half of the LED display industry in the traditional peak season, but the current domestic prices due to the price of raw materials, such as the impact of many reasons, the domestic market performance generally, and there is no obvious Some export-screen companies are expected to rely on expanding exports to play a "turnaround", and this period of time the renminbi continued to rise, for export trade increased intangible cost pressure. 

The appreciation of the renminbi for export-trade-type screen enterprises, the crackdown is big, especially in the US dollar, but it also tests the ability of domestic screen enterprises to deal with the risks of international market trade, LED screen companies want to go farther in the international market, in addition to strong demand for products, technology and financial support, The adaptability of enterprises is also very important. 

Of course, the domestic government will not leave over the past weekend, the central bank recently burst two notices: from September 11 onwards, domestic and foreign financial institutions to carry out the client's forward-selling business of the exchange risk Reserve rate from 20% to zero; As expert analysis suggests, the central bank adjusts at this point, indicating that it does not want the renminbi to appreciate too much, and that this phase of appreciation may be nearing the end and that the effective exchange rate will remain relatively stable ... 

Therefore, the export trade-type screen enterprises need not be too worried, the difficulty is temporary, instead of worrying about the exchange rate you can't manage, put more energy on the business, improve product quality and innovation, and strive to enhance the brand image, improve their own strength, in order to gain more voice in the international market.