The sharp rise in the price of spring cocoons has triggered an upward trend in raw silk prices. The surge in silk raw material costs has significantly boosted the price of Chinese silk. According to Le Bolin, deputy director of the Guangxi Sericulture Promotion Headquarters Office, "Currently, the price of spring cocoons fluctuates between 30 and 34 yuan per kilogram, compared to about 18 yuan per kilogram at the same time last year." He also noted that the price was around 20 yuan per kilogram during the same period in 2009.
Several factors have contributed to the increase in cocoon prices. "There is a shortage of cocoon and silk raw material supplies, leading to urgent demand for cocoon production," Le explained. Despite the soaring prices, many companies are still struggling with losses and downtime, yet they continue to compete fiercely for raw materials.
Although a prolonged drought in Southwest China lasting eight months has had some impact on spring cocoon prices, Yunnan's production has been less affected due to its relatively smaller contribution to national silk output and the limited scale of its sericulture industry. Declining mulberry fields and lower cocoon yields are likely the main causes behind the rising prices of raw silk materials.
According to data from the National Cocoon Office, the total area of mulberry fields across China dropped by 8.5% year-on-year in 2009, reaching 11.974 million mu, while cocoon output fell by 17.8% to 574,000 tons. The average purchase price of silkworm cocoons rose to 1,081.76 yuan per dan, an increase of 30.15%. Despite reduced production, silkworm farmers saw their income increase by 1.251 billion yuan compared to 2008, showing a trend of declining output but rising income in the sericulture sector.
Silkworm farming is labor-intensive, and as land and labor costs in eastern coastal areas continue to rise, many traditional sericulture farmers have abandoned the practice. To address this, the Chinese government launched the "East-West Project" in 2006, aiming to shift raw material production from resource-scarce eastern regions to central and western provinces with more suitable climatic conditions.
This policy has proven successful, stabilizing domestic cocoon output and boosting rural incomes. Guangxi, with its favorable climate and high rainfall, has become a major beneficiary. In 2009, the province accounted for 30% of the country’s total silkworm output, ranking first nationally. In many towns, sericulture has become a primary source of income for local families.
In Liu Sanjie Township, Yizhou City, the Wei family runs a successful sericulture business. With 34 households engaged in the activity, the village generates over 4 million yuan annually. "Because of the high profits, we don’t go out to work anymore and feel we don’t have enough time to do anything else," said Wei Dingkang.
While the rising cocoon prices have increased farmer enthusiasm, they have also put pressure on processing enterprises. At Guangxi Jia Lian Silk Co., Ltd., the spring cocoon price surge has pushed raw silk prices to around 280,000 yuan per ton—the highest level in recent years. Although some companies are facing losses, stopping operations could be even riskier.
To ensure a stable supply of raw materials and steady income for farmers, companies are seeking to develop direct partnerships with growers. This includes improving mulberry field quality and providing technical training to enhance cocoon quality.
China’s silk industry has grown into a global leader, accounting for over 70% of the world’s raw silk output. According to China Customs, silk exports reached $600 million from January to March 2010, a slight increase from the previous year. Industry officials noted that since October 2009, the international market has shown signs of recovery, with silk exports gradually improving.
Le Bolin observed that the global economy is on the rise, and China’s strong domestic demand, along with growing consumer spending on clothing and home textiles, is driving silk consumption. From January to February 2010, the silk industry recorded a total output value of 25.25 billion yuan, up 25.47% year-on-year, with profits rising by 108.71%.
Despite these positive trends, the industry still faces challenges, with a loss rate of 38.6%, higher than the national textile industry average of 35.4%. While there are early signs of recovery, the foundation remains fragile.
Industry officials also pointed out that although export volumes in January to March showed a significant drop, it reflects ongoing uncertainties in the international market. Some merchants remain cautious, and the risk of fluctuations in silk exports still exists.
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