Cotton Egypt Association (CEA), an independent body responsible for the global brand, has been supporting the implementation of ‘The Egyptian Cotton Project’ activities that include innovative training, education and awareness across the cotton supply chain. These efforts fall under the CEA’s collaboration with the United Nations Industrial Development Organization, implementing ‘The Egyptian Cotton Project,’ and working with the Cotton for Life program and Better Cotton Initiative (BCI) to enhance and advance sustainability of Egyptian cotton, while reducing contamination.

The CEA’s cooperation with BCI has allowed the deployment of pilot cotton plantations supported by cotton traders, manufacturers and brands to pave the way for a BCI startup program in Egypt planned for the 2020-2021 cotton season.

Besides adopting organic production methods, reducing water consumption and pesticides, the Egyptian Cotton Project is implementing education programs that promote farmers’ and workers’ health and welfare, gender equality, and entrepreneurial opportunities for young people, and through awareness training sessions addressing topics such as child labor, the importance of education, and qualified employment to serve as a positive alternative for youth in rural areas.

The project’s stakeholders will continue to work toward enhancing the sustainability, inclusiveness and value addition of the long- and extra-long staple Egyptian Cotton by developing the economic, social and environmental performance of cotton manufacturers, and strengthening support institutions.

The government has launched some relief measures for the textile industry. Pending GST refunds would be cleared within the next 30 days. Every refund for future GST matters will be solved within 60 days. CSR violations will not to be treated as criminal offence. There will be one definition for a medium and small enterprise. A one-time loan settlement through a check box approach will help medium and small enterprises and retail borrowers.

Banks have agreed to link their interest rates to repo rates. A sum of Rs 70,000 crores will be infused upfront into public sector banks to enable them release Rs 5 lakh crores liquidity in the market. All old tax notices will be addressed by October 1 or uploaded on the system again to increase transparency. Faceless scrutiny of I-T returns will happen from Vijayadashmi 2019. In labor laws, fixed-term employment is being facilitated. Web-based jurisdiction is being done for a free inspection. Inspection has to be uploaded within 48 hours. Compounding of offences will be a priority. The decision of banks to pass on rate cuts through MCLR reduction to benefit all borrowers is expected to be a great relief to the financially stressed Tirupur knitwear garment exporting units in the small and medium sector.

In 2019-20 season, Pakistan’s cotton production is likely to reach the high level of the 2011-12 season. In Pakistan, cotton areas have gained strong support from the high cotton prices and good rainfall during the planting period.

Cotton prices have been rising for four successive years. Cotton production may reach the level of 2011-12 this season. In addition, during the planting period, Pakistani cotton prices were relatively low compared with international cotton prices, stimulating domestic enterprises to choose local cotton, pepping up the domestic cotton prices somewhat and improving the growers’ enthusiasm.

Since the 2011-12 season, when cotton production hit a record high of 2,518 million tons, production has been constantly decreasing. In the 2015-16 season production was only at 1.814 million tons, down about 28 per cent compared with that in the 2011-12 season. Higher cotton areas are supportive to reach the target of cotton production. In the first half year of 2019, precipitation in Punjab has increased by 89.1mm to 133.2mm, and that in Sindh up by 29.5mm to 64.1mm. The favorable weather condition is also good for the growing of cotton. The good price and favorable weather conditions give strong support to reach the cotton target of the 2019-20 season.

Eager to avoid the higher costs associated with tariffs, several American consumer goods companies are considering shifting, or already have shifted, their supply chains away from China. They are in most cases seeking alternative manufacturers in countries that offer similar manufacturing capacity for a comparable cost.

However, rapid changes to supply chains also may expose companies to greater risks. Establishing compliant, reliable and secure supply chains takes time, and failure to properly vet suppliers can have material consequences.

One US company took 20 years to establish its supply chain in China. To cultivate a partnership, companies typically vet new suppliers by executing multiple inspections and verifying compliance with company-specific policies and codes of conduct. Once suppliers achieve these initial requirements, they have to be monitored on an ongoing basis and must comply with periodic audits. Companies have to invest a significant amount of time and money to establish and maintain a secure supply chain. As China and the United States continue to introduce new tariffs and exchange threats, companies may forego these precautions as they attempt to quickly redirect production. This situation could be exacerbated given that the factories with available capacity to accept new orders are likely to have lower standards.

US fashion brands and retailers are deeply concerned about the negative impacts of the tariff war on their businesses. Prices of US apparel imports are rising, making increasing production and sourcing cost the top business challenge. As companies are moving sourcing orders to Bangladesh, Vietnam and India, the average price of US apparel imports from these countries – the main alternatives to China — has gone up quickly. Trade diversion effect has accelerated US fashion companies’ pace of reducing sourcing from China. About 83 per cent of respondents expect to decrease sourcing from China over the next two years, up further from 67 per cent in 2018.

US companies feel they have no option but to increase their retail prices should the US-China tariff war escalate further. The scheduled Section 301 tariffs on $300 billion Chinese products to take into effect on September 1, 2019, will be increased from 10 per cent to 15 per cent.

Unit price of US apparel imports across the board increased 10.7 per cent in the first five months of 2019. The unit price of US apparel imports in the first five months of 2019 from Bangladesh, Vietnam and India shot up 25.6 per cent, 23.4 per cent and 21.2 per cent respectively.

Last World Trade Organization (WTO), data shows, global fashion exports in the last decade increased by 35.1 per cent, while global trade increased 26.4 per cent. In 2007, two years after the Multifiber Agreement came into force, clothing exports increased to $349 billion. A decade later, these exports increased to $471 billion. Global trade in the same period increased from $14 billion in 2007, to $17.7 billion in 2017.

India registered the strongest performance in its international clothing trade during this period; followed by Brazil and other Asiatic countries excluding China and the ASEAN member. Exports by the United States increased by 28.6 per cent between 2007 and 2008, those by Japan increased by 20.1 per cent and the European Union by 33.5 per cent.

China, that entered the WTO in 2001, increased its garment exports by 93.3 per cent during this period. Middle East and Australia also positioned high in the list, with rises near 100 per cent.

Restrictive measures of world trade registered exceptionally high levels between October 2019 and mid-2019 as the value of trade affected by these countries was estimated to be $339 billion, the second highest number available, after the $588 billion registered the previous period.

New Delhi hosted the 4th edition of Gartex Texprocess from August 10 to 12.This is a one-stop selling and sourcing platform. It witnessed intense networking as it brought together 180 exhibitors from four countries and 10,390 trade professionals from 290 cities and six countries under one roof. Multiple zones and focused business segments on the show floor ensured that the fourth edition brought together stakeholders of the textile and garment industry for cross-sector, creative and collaborative interactions.

The dedicated segments at Gartex Texprocess India ensured dynamic synergy on the show floor and proved to be vital in highlighting the latest tech-advancements and trends that the textiles and apparel industry is moving towards. While smart and recycled fabrics, sustainable alternatives, advances in digital textiles, elegant embroideries and trims were among some of the highlights on the show floor that help manufacturers differentiate their products in the market, seminar sessions alongside the exhibits were tailored to provide insights on high-potential business segments.

As a one-stop selling and sourcing platform, the event lived up to its promise of a truly business-oriented platform for India. With high quality visitors and decision makers walking in over all three days, the trade potential at Gartex Texprocess proved to be strong for the sector.

Indonesia will impose a tariff of 2.5 per cent to 18 per cent on imported textile products. The form of tariff will be like a pyramid, the smallest upstream industry at 2.5 per cent and the biggest downstream at 18 per cent. The aim is to protect the domestic textile industry from Chinese products, especially as a result of the trade war. In addition, the depreciation of the yuan has made Chinese products more competitive than local products since the price gets cheaper.

Indonesia fears a heavy influx of yarn, fabric and garment products from China. The US has imposed a 25 per cent import duty tariff for textile products from China. Meanwhile, the tariff imposed by Indonesia is around ten per cent to 15 per cent. With these tariff differences, there is an opportunity for China to shift its textile products to Southeast Asia, including Indonesia. This will lead to an excess supply of textiles and prices will fall and hit the manufacturing sector.

As it is the performance of the Indonesian textile industry sector has continued to decline in the last ten years. On an average, exports have risen only three per cent while imports have risen 12 per cent.

The Indian spinning industry is facing its biggest ever crisis. One third of the country’s spinning capacity is closed. Mills are currently incurring huge losses and the upcoming cotton crop of four crore bales is struggling to find buyers in India and abroad. The textile sector has witnessed big job cuts — over 25 lakh jobs — in the last decade.

Even the cotton ginning industry which is a supplier to textile mills is in the doldrums. For instance there were 422 ginning mills in Punjab in 2007 and the number has come down to 60. Nearly 40,000 workers were employed by ginning factories. In the last 12 years, 34,000 jobs have been lost.

The decline in exports in the first quarter of the current fiscal has come to haunt cotton growers. The 27 per cent increase in the minimum support price for cotton in India is making their produce internationally uncompetitive. Cotton in the international market is cheaper than in India. Farmers are worried that these trends will affect the market prices of cotton, the harvest for which will begin in the first week of September. Cotton has been sown over nearly 16 lakh hectares in the three states of Punjab, Haryana and Rajasthan.

Apparel Sourcing Week will be held from February 20 to 22, 2020, Bangalore. This is a sourcing platform for top foreign retailers and brands. It provides Asian manufacturers a platform to showcase their products and manufacturing capabilities to brands and retailers from all over the world including India. The target is to have 100 hand-picked exhibitors for their focus on creativity, quality, delivery commitments and compliance to social obligations. They will be showcasing a wide range of products that include women’s wear, children’s wear, denims, formal and casual suits, sportswear, jackets, lingerie, swimwear and sweaters. There will be 50 manufacturers and suppliers of fashion fabrics and accessories. While there will be a variety of cotton, manmade and sustainable fabrics available in various blends, accessory makers will present a wide array of laces, buttons, zippers, threads, interlinings and labels. There will be a special section dedicated to fabrics and accessories. The best of the apparel sector from across India, Bangladesh, Vietnam, China and Sri Lanka will be showcased.

Seminars, workshops, open-house discussions and networking opportunities will help manufacturers get a better understanding of Indian and international retail and the evolving dynamics of sourcing in various markets and retail formats.