We know the hardships of silk
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August 13, 2025
The traditional processes in the silk industry, such as reeling and weaving, are not only unprofitable but also face a peculiar situation where the cost of raw materials rises even as the selling price of finished products remains stagnant. This issue has become increasingly severe since last autumn. Zhejiang Silk Road Group’s Zhejiang Silk Factory, which is among the top-tier operations in the country, has smooth raw material procurement channels and highly skilled staff with strong motivation. Despite these advantages, the factory has been losing 20,000 yuan for every ton of raw silk produced over the past six months. This year alone, millions of yuan have been lost.
After the autumn cocoon season last year, the price per ton of cocoons soared to 100,000 yuan—nearly doubling from the previous year. This forced silk prices to rise sharply. However, with poor export performance, silk factories cannot afford the high-priced raw silk. As a result, rising raw material costs and a downturn in export markets have pushed many silk mills into a state of crisis. Complaints from workers have increased, and losses are mounting daily. Even halting production leads to losses, and the fear of losing both market share and employees is growing.
Faced with this dilemma, some factories have resorted to shortening working hours and increasing holidays. In our city of Huzhou, four or five silk mills were shut down during the winter last year. Meanwhile, the Zhe Si Plant was tasked with replicating the "Lake Lane" silk that won an award at the first World Expo 159 years ago, a proud honor for our country. How can we justify cutting workdays or reducing hours when such important international events are coming up? What if visitors from the top of the international expo come by next year? We must maintain normal production.
To do so, we are forced to buy expensive cocoons on a day-to-day basis, without considering price or quality, just to keep the machines running. This kind of desperate situation is unprecedented. The price of cocoons has now surpassed that of wire, and the flour-like texture of silk has become a strange norm in the industry—not a recent phenomenon.
Some attribute the problem to last year's drought affecting cocoon production, but in our view, this is not the root cause. Since the new century, the prices of cocoons and silk have fluctuated dramatically, with raw silk prices reaching as high as 360,000 yuan and dropping as low as 110,000 yuan—a difference of more than three times. Yet no matter how much the prices swing, silk factories never make a profit; they only suffer losses.
Why is this the case? Because there is a clear pattern: when cocoon prices rise, they don't fall back. Even when prices drop, farmers are still unable to sell their cocoons at a reasonable rate. This roller-coaster cycle leaves the silk industry dizzy and unstable. Who suffers from this "hit-the-ball" phenomenon? The answer is two-fold: first, the silk enterprises themselves, which struggle to invest in technology and pay their workers; second, the sericulture farmers, who risk everything each year, planting mulberry trees only to face uncertainty about the next harvest. Sericulture is like gambling—win or lose, there's no time to focus on improving quality.
Who benefits? A group of speculators, including those involved in cocoon trading and speculation. The pattern is clear: when cocoons are sold at high prices, speculators drive up the market; when prices fall, farmers are forced to sell at a loss. China is the world's largest silk producer, with an annual output of 110,000 tons, accounting for roughly 85% of global production. The industry contributes significantly to the national economy, generating billions in value and providing tax revenue. The reeling industry employs around 150,000 people, yet these workers earn an average of less than 20,000 yuan annually—far below the income of civil servants who earn around 50,000 yuan a year. This stark contrast highlights the deep-rooted issues within the industry.