Many leather and footwear businesses have export orders until the end of the year.

Many leather and footwear businesses now have orders until the end of the year, helping the industry's export prospects for the whole year reach 26-27 billion USD.

According to data from the General Department of Customs, in the first 7 months of 2024, footwear exports reached 10.147 billion USD, up 10.4%; handbags reached 1,621 million USD, up 7.4% over the same period last year. Of which, FDI enterprises accounted for 77.9% of total turnover (footwear 79.3%, handbags 70%).

Many signs show that exports of footwear industry strongly recovered from the last months of 2023, many businesses have signed export contracts for the whole year 2024.

Thai Binh Investment Joint Stock Company (Thai Binh Group) is a typical example. Currently, the company is focusing on production according to orders to ensure delivery progress for partners. In addition to production, the company is expanding its factories, attracting 10,000 more workers to receive new orders, and at the same time to meet the requirements of increasing export output from the first quarter of 2025. To date, the company has had enough export orders for the whole year of 2024.

Many leather and footwear businesses have export orders until the end of the year. Photo: Can Dung

Not only Thai Binh Group, according to the representative of Binh Duong Leather and Footwear Association, leather and footwear enterprises in the province currently have enough export orders for the whole year of 2024. In addition, thanks to stable domestic production conditions, the number of orders in the last months of the year has shifted from some Asian countries to Vietnam, opening up good prospects for the leather and footwear industry in the coming time.

Notably, the export output of leather and footwear of Binh Duong enterprises in the first 7 months of 2024 reached an average of 5 million pairs/month, an increase of nearly 1.1 million pairs/month compared to the monthly average of 2023.

Regarding the industry's export markets, data from the General Department of Customs also shows that in the first 7 months of 2024, the leather and footwear industry still focused on 5 main markets, accounting for 97.3% of total export turnover. Of which, the North American market accounted for the largest proportion (footwear 41.4%, handbags 47%), followed by the EU (footwear 29.5%, handbags 25.4%). Asia currently accounts for 22.2% of footwear exports and 24.5% of handbags.

Total leather and footwear exports to the 16 largest countries accounted for over 88.4% of the total export turnover of the entire industry. Specifically: Exports to the US reached 5,668.1 million USD, up 14.3%; China 1,180.5 million USD, up 6.4%; Japan 811.9 million USD, down 4.4%; Netherlands 1,074.2 million USD, up 55.2%...

Footwear is one of the industries that takes advantage of free trade agreements, including the Vietnam-EU Free Trade Agreement. Statistics also show that footwear exports to some markets in the region have achieved relatively high turnover, such as: Germany with 532.4 million USD, Belgium with 808.6 million USD, the Netherlands with 1,074.2 million USD, Spain with 335.8 million USD, etc.

Similarly, in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) market, the total export turnover in the first 7 months reached 2,098.3 million USD, up 6.1%. However, the growth rate and decrease in each market were different. In particular, the Chilean market had the highest growth rate of 20.2%, reaching 82.3 million USD, Mexico increased by 18.8%, reaching 307.5 million USD, however, the Peruvian market decreased by 10.5%, reaching 45.0 million USD, Australia decreased by 3.7%, reaching 241.8 million USD...

In the first 7 months of 2024, the industry's equipment imports reached only 85.9 million USD, up 218% over the same period in 2023. Leather imports reached 1,068 million USD, up 15.5% over the same period in 2023, reflecting that new investment and production of enterprises are on the way to recovery.

Although the export turnover of the footwear industry has been assessed positively since the beginning of the year, businesses are worried about facing many big challenges. Many major footwear importing countries have put forward a series of new requirements for the import of products with increasingly high social and environmental responsibility.

Typically, the EU market, from March 2024, this market has begun to introduce new requirements such as ecological design with sustainable designs. Or the issue of traceability and transparency of the supply chain. If importing raw materials from abroad, businesses will have to be transparent about the entire production process in the production area.

Therefore, exporting countries, including Vietnam, need to quickly improve and make transparent information about their product supply chains, starting from raw materials, sustainable production towards a circular economy, and responsibility towards society and the environment.

Furthermore, the global greening trend is increasingly demanding on businesses, especially export businesses. Footwear businesses cannot stay out of the 4.0 revolution, applying automatic production lines, artificial intelligence, and green development if they do not want to be eliminated from the global supply chain.

Ministry of Industry and Trade The positive results of the leather and footwear industry contribute to completing the growth target of the processing and manufacturing industry in 2024. In order for the leather and footwear industry as well as export industries to better utilize the signed free trade agreement, Mr. Ngo Chung Khanh - Deputy Director of the Multilateral Trade Policy Department, Ministry of Industry and Trade said that it is necessary to establish a connection group between export enterprises and relevant agencies; focus on building brands and have a methodical and effective strategy; build an ecosystem for the industry; focus on improving quality, paying attention to sustainable development...

Source