S K Jhamb, Director-Materials, Vardhaman Textiles, expects cotton consumption to revive in the long run though the company expects reduction in cotton consumption in the short run. The company foresees an increase in consumption of the US upland cotton in the contamination control knit wears, white application and light shades cotton fabrics. Prime demand will be for fine shirting fabric and home textile application, he says.

Vardhman Textiles offers the widest range of specialized greige and dyed yarns in cotton, polyester, acrylic and a variety of blends. It also manufactures value added products like organic cotton, melange, core spun yarns, ultra yarns (contamination controlled), gassed mercerized, super fine yarns, slub and cellulose yarns and fancy yarns for hand knitting.

The company consumes 93 to 95 per cent of Indian origin cotton and imports about 5 to 7 per cent of the cotton from the US, Brazil, Australia and Egypt. The company consumes US cotton mainly for the manufacturing of contamination-controlled textile products. It also uses US Upland and ELS cotton Pima to meet the tag- driven demand of the customers/ brands.

Vietnam’s total garment exports are expected to fall by 20 per cent against the previous year to about $31-32 billion. Garment makers in the country need to implement urgent and flexible measures to adapt to the new situation and take full advantage of the opportunities brought about by new-generation free trade agreements, especially the one with the EU (EVFTA) which took effect on August 1.

Vietnam’s clothing exports to the European Union are only $5.5 billion or a market share of 2.2 per cent. There is still a lot of room for Vietnamese garment producers to bolster exports and expand their markets. Their garment exports to the EU can grow rapidly by 67 per cent over the next five years. To achieve this, Vietnam needs more than 9 billion meters of fabric annually, domestic suppliers can meet only one third of this and the rest must be imported.

Ministry of Industry of Trade should include fabric from Japan and the Republic of Korea, which also have trade agreements with the EU and account for 23 per cent of Vietnam’s total imports. Comprehensive measures are also needed to fill the shortfalls facing the garment sector. Specifically it is necessary to build concentrated and large industrial parks in all the northern, central and southern regions, and introduce incentives to call for investment in the spinning, weaving and finishing stages.

The government needs to issue a garment development strategy for 2020-2040 period, consider abolishing value added tax when domestic enterprises purchase materials locally and reduce their logistics costs. The government should also act to help enterprises connect with each other to form close linkages, thus bolstering their growth and keeping them competitive with foreign firms.

For their part, garment makers need to reform themselves towards becoming a sustainable part of the global garment supply chain if they want to quickly increase

H&M-owned brand Cos is launching own resale business, a move that will allow customers to buy and sell used Cos clothing. The digital platform, called Re-sell, is being positioned partly as a circular and renewable solution. But pegging resale as sustainable is not a simple claim to make.

The community-curated online selection will enable peers to sell old favorites and shop new pieces from the brand’s archive. The seller sets the price — and provides the product information and manages postage — and Cos will take a 10 per cent commission to cover the operational costs of resell. Cos is one of the first major brands to operate resale for its own products. The Re-sell platform will allow customers to buy and sell used Cos clothing.

GlobalData predicts the resale market to grow from $24 billion in 2018 to $51 billion by 2023. Rachel Kibbe, Director-Circularity, Retrievr however says, at this point resale should be the minimum a brand is doing to reduce impact. Critics also say the model can only work if Cos manufactures long-lasting products and becomes part of a larger shift in its business model.

As per BGMEA, Bangladesh's garment exports surged nearly 50 per cent in August as factories swung into full gear to meet orders from global retailers. Shipments of ready-made clothes increased to $3.3 billion. Reinstatement of cancelled orders from retail titans including H&M, Primark and Walmart revived the industry even though Bangladesh is still suffering from the pandemic. Some companies are now looking for thousands of workers to cope with new orders.

In April, Western retailers, who normally buy around $30 billion worth of garments each year, cancelled $3.2 billion-worth orders after the virus forced stores to shut down. This led to 83 per cent decline in apparel shipments in April and more than 50 per cent in May. Because of the pandemic, Bangladesh closed factories for one month from March 26. The 4,500 garment factories employ more than four million workers -- about two-thirds of them women -- and hundreds of thousands were laid off.

As per a report from the Institute of Supply Management (ISM), the Purchasing Manager’s Index in the US grew 1.8 per cent to 56 per cent in August. Timothy R Fiore, Chairperson, ISM Manufacturing Business Survey Committee, revealed five of the big six industry sectors expanded with new orders and production indexes continuing at strong expansion levels. Demand and consumption continued to drive expansion growth, with inputs representing near- and moderate-term supply-chain difficulties. ISM’s New Orders Index registered 67.6 per cent in August, a 6.1 per cent increase compared to July. This indicates that new orders grew for the third consecutive month following a dip in April.

Production Index registered 63.3 per cent in August, up 1.2 per cent from July, indicating growth for the third consecutive month and the highest level of performance since January 2018. The 15 industries out of 18 sector reporting growth in production during the month included textile mills. Delivery performance of suppliers to manufacturing organizations was slower in August, as the Supplier Deliveries Index registered 58.2 per cent. This is 2.4 per cent higher than the 55.8 per cent reported in July.

Textile mills were among 11 of 18 industries reporting slower supplier deliveries in August. The Inventories Index registered 44.4 per cent in August, down 2.6 per cent from July. Inventories contracted for the second straight month after two consecutive months of expansion. This is the lowest reading for the Inventories Index since January 2014.

The two industries reporting higher inventories in August were apparel, leather and allied products, and plastics and rubber products. Textile mills reported no change in inventories for the month.

The ISM Prices Index registered 59.5 per cent, a jump of 6.3 per cent compared to the July reading of 53.2 per cent , indicating raw materials prices increased for the third consecutive month. The 17 industries reporting paying increased prices for raw materials in August were led by textile mills and apparel, leather and allied products.

According to a Modern Slavery index, the risk of slavery in Asian manufacturing hubs is set to worsen with the economic impact of coronavirus, increased labour rights violations and poor law enforcement. The index prepared by risk analytics company Verisk Maplecroft, for the first time included India and Bangladesh in the extreme risk category, joining China and Myanmar in a group of 32 countries with the worst risk of slave labor.

The risks faced by workers in Cambodia and Vietnam also rose to their highest in four years, taking 32nd and 35th places in the ranking of 198 countries which identified North Korea, Yemen and Syria as the three worst nations for slave labor. Asian garment workers supplying global fashion brands lost up to $5.8 billion in wages from March to May, the Clean Clothes Campaign pressure group as the COVID-19 pandemic led to store closures and cancelled orders.

About 60 million people work in Asia’s garment industry and falling sales have put many jobs at risk. Laid-off workers are likely to turn to exploitative jobs or may put their children to work to cope with the loss of earnings, industry experts say. The affiliates of IndustriALL Global Union, a federation that represents workers in 140 countries, have reported wage cuts in existing jobs as well as removal of facilities such as transport and canteen with subsidized food.

Travel restrictions have made it harder for companies to carry out audits to ensure ethical working practices in their supply chains, said the slavery index, which aims to help businesses identify risk.

Raja Shanmugam, President, Tirupur Exporters Association (TEA) believes, global brands will increase sourcing from India. Shanmugam therefore, urges the government to extend the six-month moratorium period as it needs support to rebuild its business post COVID-19. P Nataraj, Managing Director, KPR Mills, also expects sourcing from India to be much higher than last year. Carter’s, a baby wear brand has asked SP Apparels to develop new fabrics as it wants to shift significantly from China to India.

AEPC is also negotiating with Taiwanese and Korean entities for a joint venture, which will work on developing the fabric with man-made fibre. Garment exports from Tirupur dropped to Rs 25,000 crore for the year ended March 2020 from Rs 26,000 crore in the previous year as the Covid pandemic wiped away most March exports. The target was to export garments worth Rs 28,000 crore. Domestic sales were flat at Rs 25,000 crore for the fiscal. The town employs 6 lakh workers, half of whom are from other states.

Apparel retailer Guess is tightly managing costs and inventory to mitigate the effects of COVID-19. During the second quarter of fiscal 2021, the company continued to experience lower net revenue compared to previous year, as it remained challenged by store closures and lower demand. The company partially offset revenue declines by reducing sales, general and administrative (SG&A) expenses for the quarter through expense savings, including one-time actions such as furloughs and temporary salary reductions, and permanent ones, including headcount reductions and lower discretionary spending.

The company also paid back a significant portion of previously drawn down credit facilities and reinstated salaries that had been temporarily reduced. During the quarter, Guess gradually reopened most of its global fleet of brick-and-mortar stores, resulting in stores being closed for approximately 30 per cent of quarter. As of August 1, approximately 95 per cent stores were open, with the majority of closed stores within interior malls of California.

The company’s net revenue for the second quarter ended August 1 declined by 41.7 percent to $398.5 million from $683.2 million in the prior-year period. It recorded a net loss of $20.4 million in the quarter compared to net earnings of $25.3 million for year-ago period. It saw an operating loss in the quarter of $14.3 million, including $12 million in non-cash impairment charges taken on certain long-lived store related assets. Its operating margin decreased by10.3 percent to negative 3.6 percent from positive 6.7 percent in the same year-ago quarter, driven primarily by overall deleveraging of expenses due to the negative impact from the COVID-19 pandemic on global operations.

Take-off of retail demand in the US and Europe, India’s key markets for apparel exports, has been downsized from June. Buyers have revised demand projections by 30 to 40 per cent. They have also delayed orders for Indian ready-made garments for the next spring season by 15-20 days. Spring collections start arriving at retail stores in the Northern hemisphere closer to January. Orders for these are usually placed by mid-August or early September and goods are shipped by November.

However, Gautam Nair, Managing Director, Matrix Clothing says downward revision of orders was specific to a few buyers and it was still early to generalize it as a decline across the board. Another manufacturer point out retailers may also be carrying leftover stock from last spring as sales were hampered due to the onset of pandemic.

India exports ready-made garments to some leading high-street labels, departmental stores and supermarket chains overseas. These include H&M, Banana Republic, JC Penney, J Crew, Neiman Marcus, and Target. Exports declined by over 50 per cent in April-July of this fiscal year to $2.5 billion, according to data from Apparel Export Promotion Council (AEPC).

Apparel Export Promotion Council (AEPC) expects apparel exports from the country to expand by about 40 per cent this fiscal. A Sakthivel, Chairman, AEPC, said, AEPC is majorly focusing on exports of new medical textiles this year. This will help the council to increase its total apparel exports from $15.4 billion last fiscal to about $22 billion in 2020-21.

Sakthivel also urged the council members to begin exporting manmade fibre (MMF)-based garments as there is a huge demand in the global market. Sakthivel says, AEPC will sign MoUs with his MMF manufacturers, including Reliance Industries in a bid to increase textile exports. For facilitating R&D into various fiber base, technologies, processing and sample development, the Council will set up a dedicated R&D Centre at its head office. The Council also plans to foray into Virtual Trade Fairs & Exhibitions by setting up AEPC’s own virtual platform.