Authentic Brands Group owned fashion brand Forever 21 has signed a licensing deal with AR Holdings, a leading brand and retail operator, to expand operations into the Latin American market.

As per the deal, AR Holdings will distribute the brand across all channels in the region including e-commerce, wholesale and 26 retail stores in Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Panama and Peru. The company is an experienced player in the Latin American retail market with vast expertise in the fashion, home and restaurant industries. It plans is to launch an e-commerce site for Forever 21 in Latin America in 2021.

ABG purchased Forever 21 out of bankruptcy court in partnership with Simon Property Group and Brookfield Property Partners for $81.1 million in February. In June, it tapped IB Group to serve as licensee for the brand. In June, it licensed IB Group to expand the brand in Mexico.

As per the Gujarat Cotton Ginners’ Association (GCGA), a reduction in area under cotton cultivation is expected to bring down cotton production in Gujarat this year. Cotton output in the state is estimated to be around 85-90 lakh bales in 2020-21as compared to 95 lakh bales in 2019-20.

Cotton production in Gujarat also includes production of raw cotton. Gujarat ginners procure raw cotton from other states like Maharashtra and such raw cotton is then ginned and pressed within the state. According to a pan-India trade body member, the flow of cotton from other states may also be low this year due to cotton procurement by CCI at minimum support price (MSP).

However, few believe Gujarat’s production may reach 95 lakh bales given the improvement in yield this year when compared with last year. Meanwhile, the price of benchmark Shankar-6 cotton variety has increased to Rs 40,000 per candy mainly due to good demand from exporters and textile as well as spinning mills.

Prices had dropped to Rs 32,000 per candy in April-June following the lockdown. Currently, around 22,000 bales are arriving in the local markets of Gujarat.

Indian Beautiful Art, also known as IBA Craft was selected as a finalist in the National Startup Awards in the AR category. The company was awarded for the introduction of JIT – A new tool in textile technology.

The tool deals with the ‘demand-oriented production’ methodology with an objective to produce what is demanded by the market and control utilization of natural resources along with no dumping of waste fabric or garment. The problem is being solved in two parts, instead of getting prints of the photoshoot, images on the clothes are tested using technology. This effectively cuts the cost of photoshoot production and creates a single prototype for various patterns of the same garment. The colors and designs can be changed directly with sizes till 5 XL, saving time and resources. Secondly, it is assisting in compliance of energy, water, and environment conservation.

IBA has shipped over 1 million products worth $5 million to over 136 countries. The company boasts of a steady base of 500,000 customers around the world. It is known worldwide for its focus on redefining the process on which the garment industry runs.

The USDA Foreign Agricultural Service forecasts cotton cultivation area in Turkey to decrease to 350,000 hectares (ha) for the season 2020/21. The association also projects production to decline to 615,000 tonne compared to 740,000 tonne in 2019/20.

A major reason for this is the mandatory rotation rule of the Turkish Ministry of Agriculture and Forestry (MinAF) which forced some farmers not to plant cotton this season or they would not have been entitled to subsidies. Another reason was that the Government of Turkey (GoT)’s 0.80 TL/kg subsidy established in 2018/19 was not increased for 2019/20, despite high inflation and the Turkish Lira (TL) losing value against major currencies. Low yields, unattractive cotton prices, inflated costs, uncertainty created by Covid-19, and better returns from alternative crops in addition to not enough subsidies from GoT and the fourth-year rotation rule are the major reasons for the expected decrease in planting areas.

Since the weather conditions have been better compared to the last season during both planting and growth stages, the production reduction compared to last season is lower than the cut in the planting area. Market sources indicate that there is no major pest problem seen in the Southeast Region (GAP Region), which seemed to be a problem last season.

Better Cotton Initiative (BCI) production is continuing to increase year by year and Turkey is expected to produce about 94 thousand tonnes of BCI cotton in 2020/21 according to the Better Cotton Practices Association of Turkey (IPUD). Although COVID-19 brought some European ready-to-wear/fast-fashion/textile orders from China to Turkey in January and February 2020, increasing the production of garments, utilization rates in the textile/ready-to-wear apparel industry dropped to less than 50 percent for three to four months. The USDA Foreign Agricultural Service now estimates the domestic consumption of cotton to be 1.4 million tonne in 2019/20.

The primary textile sector is being hailed as the next big thing after readymade garments in Bangladesh. Though the sector had a dominating presence in the country’s manufacturing sector even earlier, its main role was relegated to meeting domestic demand under high protective tariffs and import quotas (pre-2000). As a result, products manufactured by this sector were not internationally competitive and exports were negligible or non-existent, reports Daily Star.

Entrepreneurial vision and new policies boost RMG

However, a confluence of entrepreneurial vision and evolution of contemporary policies changed all this in the 1990s. From a $624 million in FY 1990, RMG exports grew to $ 4.5 billion by FY 2000, registering a 600 percent rise in a decade. However, as RMG exports increased, intermediate inputs like yarn, fabrics and garment accessories had to be imported from countries like China, South Korea, India, and Pakistan. From $435 million in FY 1990 these imports grew to $3.2 billion in FY 2000. This stirred local textile industries to a massive business opportunity that was going waste.

Time benefits of local sourcing

To prevent this, the new generation of textile entrepreneurs started looking for new opportunities for domestic sourcing of raw materials and rising demand for textiles. The end of 1974 Multi-Fibre Arrangement (MFA) in 2005 created larger market opportunities. However, it also increased competition from well-heeled apparel producers. Bangladesh apparel factories began sourcing yarn from local suppliers. Local sourcing enabled them to avail intermediate inputs on time which drastically reduced their lead times.

Boost to backward industries spurs raw materials investments

In the mid-1990s a new generation of textile entrepreneurs emerged in Bangladesh which was ready to seize the opportunity created by the RMG industry. These entrepreneurs gave a boost to their investments in export-oriented textile projects aimed at producing yarn and fabrics. Easy availability of funds from banks, supportive taxes and government subsidies gave a boost to these backward linked industries including production of accessories like packaging, buttons, zippers, and labels.

Over the past three decades, the supply of intermediate inputs to RMG exporters has grown into a large industry in Bangladesh. The second major development after RMG, it is another popular way to describe the country’s industrial development.

As per BKMEA knitwear exporters source almost 80 per cent of their yarn requirement from local textile producers. Moreover the number of yarn manufacturing mills has doubled from 200 in 2000 to 433 in 2019 while spindle capacity has tripled to 13.5 billion kg of yarn. This growth is mainly attributed to the rapid expansion of knitwear exports from $1.5 billion in FY 2001 to $16.9 billion in FY 2019.

Production of denim fabrics in Bangladesh is an entirely export-oriented activity with 60 per cent of the annual denim requirement of 840 million yards supplied by 32 denim mills that have cropped up in the past 20 years. Other cotton-based fabrics and man-made fibre (MMF) production is also catching up to meet 40-45 per cent of demand coming from garment exporters, says BGMEA.

No longer a supporting industry

In the past 25 years, that Bangladesh textiles segment generated $21-plus billion industry that can no longer be relegated to just a sideshow to the $34 billion RMG. This is a result of introduction of new policies promoting backward linkage, says BTMA. This deemed export sector rolls everything including import substitution, export expansion, and export diversification into a single policy. These modern textiles are laser-focused on substituting massive amounts of imported yarn and fabrics. They are the embedded components of the final knit or woven garments that are deemed for exports

With the rise of RMG, embedment of principal inputs into non-RMG exports has also increased grown. The primary textile sector has become a predominant part of the textile industry. It can no longer be dismissed as non-competitive domestic industry

The US Federal Trade Commission (FTC) amended the rules and regulations under the Textile Fiber Products Identification Act to incorporate the most recent ISO 2076 standard for generic fiber names. The rules become effective on November 5, 2020.

The Textile Fiber Products Identification Act (16 CFR 303) requires that certain textiles sold in the United States disclose the generic names and percentages by weight of the constituent fibers in the product, the manufacturer or marketer name, and the country where the product was processed or manufactured. The recent amendments incorporated the latest version of the relevant ISO standard, ISO 2076:2013(E), “Textiles – Man-made fibers – Generic names”. The aim of the amendments is to reduce compliance costs, increase flexibility for disclosing fiber information to consumers and to help manufacturers develop labeling that satisfies the requirements of multiple countries.

The updated ISO 2076:2013 standard added seven generic fiber names that were not defined in the 2010 standard and are now incorporated in the amendment of the Textile Rules.

In August ’20, Sri Lanka upped its apparel exports to the US by 4 per cent in volume terms and shipped 34.90 million SME of garments as compared to 33.56 million SME garments in the same month of 2019, reports Apparel Resources.

However, the values of shipment fell by 3.50 per cent to $143.08 million from August ’19 that indicates the prices are reducing in orders placed by the US buyers in 2020. Unit prices were $4.41 per SME in August ’19 which sharply declined to US $ 4.10 per SME in this year August.

Even in cumulative period January-August ’20, Sri Lanka’s unit prices have shrunk to $4.15 per SME from US $ 4.49 per SME a year earlier in the corresponding period.

It’s worth mentioning here that Sri Lanka shipped $945.47 million worth of garments to USA in first 8-month period of 2020, noting 22.91 per cent decline from a year earlier.

The share of MMF apparels was $522.16 million (down 14.53 per cent) in the total shipped values, while cotton apparel products contributed US $ 395.36 million (down 32.23 per cent) in January-August ’20 period.

The Tamil Nadu Alliance, a coalition of civil society networks working in the area of textiles in the State, has called upon textile brands and retailers to sign a declaration that will improve the working condition of laborers in textile mills in the State.

According to a press release, it called on brands and retailers to do more to abolish exploitative working conditions within textile mills in Tamil Nadu. International brands and retailers that source yarn and fabric from the textile units here should take steps to address “severe exploitation in their textile supply chain.

The Tamil Nadu Declaration, developed by the alliance, highlights the need for sustained action by brands and retailers to address exploitative practices in textile spinning mills.

It urged the retailers and brands to expand supply chain transparency to all textile manufacturing facilities, support the effective implementation of labor laws and protections in Tamil Nadu, adopt sustainable sourcing and purchasing models that promote decent working conditions throughout the supply chain, integrate worker-driven approaches to monitor compliance with labor standards and support the development of a collective grievance mechanism in the state.

As per an Economic Times report, national apex body of traders and retailers, Federation of All India Vyapar Mandal (FAIVM), has requested Union finance minister Nirmala Sitharaman and industry and commerce minister Piyush Goyal to initiate enquiries on some suspected aspects of festive mega sales announced by two big e-tailers.

In a letter jointly sent to the two Central ministers, FAIVM alleged that a hefty discount in the nature of predatory pricing; cash back by credit/debit card banks, and high rate of interest on EMIs offered for buyers are needed to be scrutinised thoroughly. FAIVM has further shown its concerns whether GST being collected by vendors is being properly deposited with the government as per norms as about 6.5 lakh new vendors have been added by e-commerce portals and about most of sales are happening in tier-III and rural areas where awareness on GST is not adequate.

VK Bansal, National General Secretary, FAIVM said that share of e-commerce is likely to double this festive season sales from 5 per cent to 10per cent. The gross merchandise value by e-commerce in this festive season is expected to touch $7 billion i.e. about Rs 50,000 crore. It indicates about 84 per cent increases over the last year’s festive sale.

About 50 million new shoppers are expected to be added in e-shoppers’ list, out of which about 50 per cent will join from tier-III cities and rural areas. On the other hand, e-commerce platforms have added about 6.5 lakh new vendors, mostly from Tier-II and Ttier-III cities.

The Cambodian commerce ministry recently revealed that the Regional Comprehensive Economic Partnership (RCEP) will be signed at the 4th RCEP Summit during the 37th ASEAN Summit in Vietnam in mid-November. The deal will open a wealth of new market opportunities for Cambodia to diversify its export portfolio and accelerate the inflow of regional investments.

RCEP is set to be the world’s largest free trade agreement (FTA), initially comprising 16 member countries and engaging more than 3.6 billion people, or 48.1 per cent of the world population.

Fifteen countries – with the notable exception of India which withdrew in November last year – will sign the deal. The members have not yet been able to respond to India’s concerns regarding its trade deficit with many of them, according to The Nation.

Besides the 10 ASEAN member states, the other five partners are China, Japan, South Korea, Australia and New Zealand.

Even without India, RCEP will cover more than 2.2 billion people, or 30 per cent of the world population, a total GDP of more than $25.6 trillion (29.3 per cent of world GDP) and trade value of more than $10.4 trillion (27.4 per cent of global trade).

The deal will re-orient the trade and investment landscape in the region, encourage commercial exchanges among members and serve as a vital driving engine for the manufacturing sector.