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Indonesia and Pakistan are looking to forge closer ties especially in the field of textile and value-added products. Indonesia is interested in special economic zones being developed in Pakistan. Capacity building, cultural restoration and revitalisation of historical and tourist places are identified as potential areas for partnership.
Bilateral trade between Indonesia and Pakistan is currently close to $2.2 billion, tilting heavily in Indonesia’s favor due to significant exports to Pakistan of palm oil and coal. Pakistan has extended a 15 per cent margin of preference over the standard tariff rate to Indonesian palm oil products. This helps in decreasing prices of vegetable ghee and cooking oil in the country and having a positive impact on the overall economy of the country.
The Indonesia-Pakistan Preferential Trade Agreement was signed in 2012. Under the PTA, Indonesia grants market access at preferential rates to Pakistan’s export products including fresh fruits, cotton yarn, cotton fabrics, readymade garments, fans, sports goods, leather goods and other industrial products. Similarly, Pakistan provides market access at preferential tariff rates to Indonesian exports.
Clariant and Huntsman have decided to merge. The merged company will be named HuntsmanClariant. Clariant and Huntsman have agreed on a joint strategic direction for near- and long-term value creation based on continued focus on higher growth and higher margin businesses, expansion of existing strong downstream presence, reaping benefits of complementary product portfolios and breadth of reach to deliver an additional organic sales revenue growth of around two per cent a year at around 20 per cent ebitda margin and delivering synergies in excess of 400 million dollars.
The merger brings together two strong specialty chemicals businesses with similar ebitda margins at 17.2 per cent (including synergies). It will reap complementary benefits between performance products, care chemicals and natural resources, which represent around 35 per cent of HuntsmanClariant’s combined sales and hold a comprehensive surfactant portfolio in high-end niche markets globally. This is expected to have meaningful opportunities for growth including cross-selling potential and new product applications.
There is a clear joint understanding of the combined company’s future core segments and the direct majority of investments will be directed to growth areas and growth regions.
HuntsmanClariant’s position as a leading specialty chemicals company will further benefit from complementary R&D and technological expertise as well as shared knowledge in sustainability and cross-fertilization in innovation and technology capabilities.
India has a great chance to capture the market for manmade fibers that’s been vacated by China. Synthetic textiles made from manmade fibers account for 70 per cent of the world textile supply and the rest is cotton. Given the scale of exports from China, even a one per cent shift means a ten per cent increase in India’s exports of manmade fibers and synthetic textiles.
Cotton still commands more than 50 per cent of India’s textile production. However, the synthetic textile segment is gradually growing. The world is shifting towards manmade fibers and there is a need for innovations in fabrics, integrate the value chain and invest in skill development to boost textile exports from the country. Hastening of negotiations with regard to free trade agreements with EU and Canada and labor law reforms and logistics improvements are essential for the growth of the textile sector.
India is already reeling under a huge competitive disadvantage in the international textile market when it comes to manmade fiber based textile products. Competitors like China, Vietnam and Bangladesh are ahead in global exports of manmade fiber textiles. Under-investment in the sector is the biggest challenge in India. It has resulted in a weaker value chain driving foreign buyers to other countries. Speed, innovation and digitization hold the key to India's success.
Sportswear maker Under Armour cut its full-year sales forecast amid fierce competition in the athletic apparel market, and launched a restructuring plan that involves closing stores and cutting about 2 per cent of its workforce. Under Armour is also the maker of Stephen Curry basketball shoes and Bandit running shoes. The company, which wooed investors with its quick-paced growth until a few quarters ago, has been ceding market share to No. 1 sportswear maker Nike Inc and Germany's Adidas AG.
Jane Hali, CEO of retail investment research firm Jane Hali & Associates feels Under Armour's apparel lack in fashion. While brands like Nike, Adidas and Puma are thriving from retro revivals and casual looks, UA has struggled to develop an appealing shoe. As compared to its previous forecast of 11 to 12 per cent Under Armour is now expected full-year revenue growth of 9 percent to 11 per cent.
The company will cut 277 jobs across its operations, half of which will be at the company's headquarters in Baltimore, says Under Armour spokeswoman Diane Pelkey. It is expected a pre-tax charges of up to $130 million in fiscal 2017, related to store closures, lease terminations and severance costs. Under Armour closed 33 factory outlets and 23 Under Armour branded stores in one year. The company reported a net loss of $12.3 million, or 3 cents per Class A and B share, in the second quarter ended June 30, compared with a loss of $52.7 million, or 12 cents per share, a year earlier. Under Armour posted a net loss of 3 cents on its class C shares which represent its common stock.
Made-By is a European not-for-profit organisation with a mission to improve environmental and social conditions in the fashion industry trains industry stakeholders on sustainable fibers, due diligence, wet processing, detox commitments and the circular economy. It supports fashion brands in developing and implementing sustainability strategies and tools. The scope and work is characterised by a holistic approach, which sets it apart from other initiatives in sustainable fashion.
The association works with more than 40 companies on various commitments towards sustainable fashion. Through targeted consultancy, partnerships and stakeholder engagement it works with well over 100 brands and retailers including Acne, Eileen Fisher, H&M, Hugo Boss, Kering, LVMH, Ted Baker, Tommy Hilfiger and G-Star.
The Mode Tracker tool from Made-By supports brands and retailers in improving their sustainability performance by measuring and communicating year on year performance. Made-By will update its environmental benchmark for fibers, wet processing benchmark and fiber guides, extend offers relating to sustainable fibers and Detox, and continue its work to increase supply chain transparency and mitigate potential risks along the value chain.
The organisation will also partner with other sustainable fashion platforms which aim at accelerating change toward a circular vision for fashion. Made-By supports and promotes the sustainable consumption and production of garments made in Myanmar.
For the second quarter Hanes Brands’ net sales increased 12 per cent. Organic sales improved sequentially for the second consecutive quarter and the company expects organic sales to turn positive and contribute to growth in Q2. Hanes is a marketer of everyday basic apparel under world-class brands.
On a GAAP basis, second quarter operating profit increased three per cent and diluted EPS increased 38 per cent. When excluding pretax acquisition-related and integration charges, adjusted operating profit and adjusted EPS each increased four per cent. The company’s acquisitions are contributing value as expected and cash flow efforts, including disciplined inventory management, are generating strong results. Global online channel sales increased 25 per cent and made up nine per cent of total sales.
Year-on-year segment sales decreased less than three per cent in the second quarter compared with lower sales of six per cent in the first quarter of 2017 and eight per cent in the fourth quarter of 2016. There was sequential improvement for both the basics and intimates businesses. Operating profit declined eight per cent. The company expects total net sales in Q3 to increase 2.5 per cent compared with Q3 of 2016.
US-based Cone Denim’s new fabric is a combination of spandex, polyester and cotton. This gives stretch while maintaining its shape. Manufacturers like Levi’s and Old Navy along with smaller designer brands have picked it up and incorporated it into both women's and men's jeans.
Ten years ago, Cone Denim noticed that more women were wearing leggings, so the company invested millions in developing fabrics that would help jeans makers compete. The amount of stretch put into the jeans has been increased. The shift comes at a time when there’s not just demand for comfort but also 1970s skin-tight jeans are back in fashion. After taking a dip for a few years in a row, jeans sales are expected to rise more than two per cent in 2017.
Cone Denim, has been a leading supplier of denim fabrics to top apparel brands since 1891. It offers vintage, selvage, and rigid and stretch denims. Cone Denim’s Sustainblue Collection is an environment-friendly collection comprising constructions using recycled cotton, recycled polyester and sustainable yarns. S-Gene delivers stretch and recovery without sacrificing soft hand feel. Cone Denim is synonymous with authenticity and innovation. Its global platforms include denim operations in the United States, Mexico and China.
India’s factory activity slumped to its lowest level in more than nine years in July, dragged down by disruptions to business activity following the launch of GST. July also marked the biggest month-on-month decline since November 2008, just after the collapse of Lehman Brothers triggered the global financial crisis.
The GST came into effect on July 1. It is India's most ambitious tax overhaul and is meant to unify the economy into a customs union. But ambiguous rules and a multi-rate tax structure have left firms confused on how to price their products, hurting sales. While some businesses have protested against the new sales tax, many are struggling with the new compliance requirements that require them to file at least three returns every month. Some companies see the disruptions lasting until December, which could dent near-term growth. Asia's third-largest economy grew 6.1 per cent in January-March, fast by global standards but its slowest in over two years. It will take time for businesses to adjust to the change in the tax system. An output sub-index fell to 46.3, its lowest since early 2009, from 51.7 in June. There was also a contraction in new orders.
In 2017-18, world cotton production is projected to increase by eight per cent due to an eight per cent expansion in world cotton area. India is expected to remain the world’s largest producer with output increasing six per cent. China’s production is projected to rebound by seven per cent. Production in the United States is expected to rise by ten per cent and cotton area is expected to expand by 18 per cent. After two seasons of contraction, better expected returns for cotton encouraged farmers to expand cotton area in Pakistan by nine per cent. Pakistan’s production is projected to increase by 17 per cent. Cotton production in Brazil is forecast to increase by five per cent.
World cotton consumption in 2017-18 is forecast to rise by two per cent. A modest one per cent increase is projected for China, the world’s largest cotton consumer. Consumption in India is forecast to increase by two per cent. Pakistan’s mill use is expected to rise by four per cent. Consumption in Bangladesh is projected to rise by five per cent.
World cotton trade is projected to decline by one per cent. While the United Sates is expected to remain the world’s largest exporter, its exports are nevertheless forecast to decrease by eight per cent. India’s exports are forecast to rise by two per cent and Australia’s exports by eight per cent. Bangladesh, Vietnam and China are expected to remain the world’s three largest importers.
Average cotton prices over the first six months of 2017 were 19.48 per cent higher than the first half of 2016. However, expectation is that cotton prices will tumble next season to the lowest in nine years. While Indian and Chinese cotton production remained stable after suffering a dip in 2014 and 2015 respectively, both are starting to show signs of stabilisation. In the same period, the US substantially grew its production, with Pakistan showing the most sustained growth over the past four years.
Since 2014, world’s cotton production has stalled, decreasing from 26.2 million metric tons to this year’s 22.5 million metric tons registered in June 2017 and 25.1 million metric tons as of July 2017. After five years of supply surpassing demand, production has fallen below consumption. At the end of the 2014-15 season, the world stock-to-use ratio stood at 0.89 (this is a key indicator showing available stocks were sufficient to cover almost eleven months of mill use.) Everything points to a long-lasting surplus of cotton worldwide which is made to push prices down.
Even with large reductions in 2015-16 and 2016-17, world stocks at the end of the current crop year are expected to be about 50 per cent higher than they were in the mid-2000s.
