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With the government’s move to ban high value currency notes exports of 1 million bales of cotton from India have been delayed. This has prompted farmers, who prefer payments by cash, to postpone sales, say officials. The supply crunch has driven up prices in India to levels higher than in the global market and could force buyers to switch to other producers like the United States, Brazil and African countries. It could also restrain India's total exports in the 2016/17 year marketing year that started on October 1.
Earlier this month, the Prime Minister scrapped Rs 500 and Rs 1,000 bills to crack down on corruption. But the move disrupted trading of farm commodities like cotton and soybean as most farmers prefer payments in cash. As is known that November remains a peak supply month but now supplies have stopped due to the cash crunch. Farmers who had the habit of taking payments by cash are not taking cheque payment.
Expecting a bumper crop of 35 million bales, Indian traders had contracted 2 million bales for exports to China, Vietnam, Bangladesh and Pakistan for shipments in November to January. But traders have managed to ship only around 300,000 bales and nearly 1 million bales that were due to ship in November and December are getting delayed, it is understood. India's inability to ship promptly could force buyers to switch to other suppliers like Brazil and the United States.
US president Barack Obama discussed a wide range of economic and trade matters at the 24th annual meeting of Asia-Pacific Economic Cooperation (APEC) forum leaders held in Peru on November 20. The president sought to reassure leaders from Trans-Pacific Partnership (TPP) signatory countries about the United States’ strong support for trade and its commitment to strengthening ties with the Asia-Pacific region. He also commended those leaders who have already successfully worked with their legislatures to advance the TPP ratification process and encouraged additional efforts in this area.
In his meeting with Chinese President Xi Jinping, Obama also took stock of the evolution of US-China economic and trade relations. Among other things, he encouraged President Xi to advance reforms that will help China shift to a sustainable, domestic consumption-driven economic model including reforms of state-owned enterprises and efforts to strengthen China’s financial system and transition to a market-determined exchange rate in an orderly fashion.
In addition, he stressed the urgency of addressing excess capacity in industrial sectors, including by launching as soon as possible the Global Forum on Steel Excess Capacity in line with the G-20 leaders’ Hangzhou agreement. APEC leaders also adopted or reaffirmed various initiatives and commitments aimed at ensuring that the benefits of the global economy are more broadly shared.
Organ Needle from Japan makes domestic and industrial sewing-machine needles, holding about 20 per cent of the global market share. The company produces a billion needles a year. It also makes pins for testing functions for smart phone and auto engine parts. The company develops machines that can create complicated shapes based on metalworking techniques it acquired making phonograph needles. Organ Needle collaborates with metalworking makers on improving materials to develop more durable needles for industrial sewing machines.
Currently, 90 per cent of the company’s products are shipped to about 90 countries around the world. Organ Needle has sales offices in Europe and Singapore as well as sales agencies in various countries. Organ Needle caters to diverse demands from customers and currently produces some 7,000 types of needles. It will take advantage of its internal production of equipment to manufacture needles in order to actively make proposals to and promote joint development with sewing machine and apparel makers.
Sales in China have slowed but are strong in Vietnam and other southeast Asian countries. The company has a sales unit in Vietnam and plans to expand in Bangladesh, India and Myanmar, where markets are expected to grow. The process of making sewing-machine needles takes more than 40 steps.
As the public release of supply chain information becomes a tool for apparel brands to show their commitments to promoting healthy workplaces for their subcontractors, a lot of them are disclosing lists online of their factories that are mostly based in Asia.
A recent example being US clothing brand GAP that made its supplier list available. This consists of nearly 900 garment factories in Bangladesh, Cambodia and other countries. The company said it had revised its disclosure policy for supply-chain information seeking to promote global sustainability.
According to Human Rights Watch, an international non-profit group, at least four major retailers including GAP, C&A of Germany and British store chain Marks & Spencer have disclosed their supplier list this year. Earlier, GAP was known for its negative stance on the disclosure due to what it called as competition reasons.
The first of the adopters of the disclosure include US sport brand Nike and H&M, the Swedish fast fashion chain. Nike's supplier list includes details about its contract factories such as the number of workers by location and the proportion of female and immigrant labour. Many western apparel brands and retailers are particularly keen on disclosing their factory list, it is understood. The lists have been considered closely guarded trade secrets for many manufacturers because making them public could lead to information leaks about specific products.
Earlier it was believed that providing names of skilled subcontractors to competitors could also harm competitiveness. Nonetheless, the idea is rapidly spreading around the world that leading manufacturers should be responsible for the working conditions of their subcontractors.
Last year our Prime Minister Narendra Modi had observed how India can only unlock the full potential of attracting international investment and business if it can prove that it is a leader in corporate sustainability and responsibility. The very same was voiced at the third annual conference of the Centre for Responsible Business's (CRB) the theme was ‘India and Sustainability Standards 2016.’ The conference concluded last week with experts coming together to encourage collaborative initiatives and actions.
Inaugurating the conference, Railway Minister Suresh Prabhu underscored the tremendous advantage that standards have in terms of helping companies to make informed decisions and governments to design appropriate regulations. However, he also cautioned that certain sections of standards many not be appropriate in the India context. Effective implementation of international standards can only be effective if they are aligned with the domestic context. In which case, review of those specific sections in the standards framework should be considered, rather than use it as an excuse for not doing anything.
Also, it should be ensured that standards are not used as a means for manipulating the markets to favour one set of market players, the minister said. He stressed on India's commitment to sustainable and responsible growth and shared initiatives taken by Indian Railways in this regard. The three-day annual CRB conference also discussed diverse issues for sustainable and responsible growth with the Sustainable Development Goals (SDGs) as a central theme.
Teen apparel retailer Abercrombie & Fitch posted a bigger-than-expected drop in quarterly sales. Net sales fell 6.5 per cent in the 15th straight quarter. The company’s brands include Hollister and Abercrombie Kids. Comparable sales at its flagship Abercrombie stores fell 14 per cent in Q3 compared with a five per cent drop in year-earlier period. Sales at the company’s established stores fell six per cent. Net income attributable to the company fell 12 cents per share in the quarter from 60 cents per share a year earlier.
Abercrombie and other apparel retailers have struggled with increasing competition from fast-fashion retailers such as H&M and Inditex's Zara that offer trendier but cheaper clothing. Online and off-price retailers have also lured shoppers away with discounted offerings.
In addition to closing stores, Abercrombie is tweaking its existing fleet. It will complete 64 remodels for its Hollister label this year and will test a new Abercrombie prototype store in early 2017.
It continues to maintain a conservative financial policy, with moderate debt and leverage levels and very good liquidity. Balance sheet cash continues to amply exceed funded debt levels. This is expected to remain the case as the company further implements its turnaround strategy.
The third Morocco Style- Morocco International Textile and Accessories Fair will be held in Casablanca, the cultural and trade capital of North Africa from February 24 to 27, 2017. The second edition of the Fair had seen participation from 306 leaders of international and domestic companies from 10 countries. Interestingly 12,308 visitors from 31 countries from North Africa and West Africa, Europe, America, Middle East Gulf countries and Far East showed up.
Morocco Style is full of opportunities for exhibitors and visitors to do business on a global scale. It is an international platform where sector professionals are able to meet each other and develop their network. Morocco Style is the where one can discover thousands of trendy products of widely known brands and chain stores. In the two previous editions, over 20.000 industry professionals came together to talk about Morocco Style. And, in the two previous years, more than 250 business meetings were held at Morocco Style.
Morocco Style is a unique exhibiton of Morocco where one can discover new, more cost-effective solutions to ones existing processes. One can meet new suppliers, customers and business partners. Apart from focusing on overseas markets, Morocco Style covers the whole industry chain and offers specialised services for all professional buyers.
Bangladesh’s $26 billion garment industry is booming. The industry is said to be the key driver of the economy and nation’s development. Exports of RMG account for over 80 per cent of the nation’s export earnings. Second only to China, the world’s second-largest apparel exporter of western brands, Bangladesh’s industry has 60 per cent of export contracts of western brands with European buyers and 40 per cent with American buyers.
Dhaka, the commercial capital of Bangladesh, is home to quality manufacturers and exporters of garments. As a professional garmenting hub, the Bangladesh capital has attracted manufacturers by way of the Taiwan Textile Fairs. The said fairs, with their high quality and technically advanced fabrics and accessories, will help Bangladesh’s manufacturers increase the quality of their export offerings.
The 2nd edition of the Taiwan Textile Fairs in Bangladesh will take place on November 20 and 21 this year in Dhaka. Organised by the Taiwan Textile Federation (TTF) and the Bureau of Foreign Trade (BOFT) of Taiwan, and managed by Worldex India Exhibition & Promotion the event is endorsed and supported by the Bangladesh Garment Buying House Association (BGBA).
The Taiwan Textile Fairs in South Asia is an excellent opportunity for Bangladesh’s apparel manufacturers, exporters, brand-owners, sourcing offices, buying houses, buying agents, importers, etc. to look for new materials and connect with leading suppliers from Taiwan at their doorstep. The fair will showcase variety of products ranging specialty yarns to performance and outdoor fabrics, eco-friendly and textured fabrics.
Bankers hoping to recover Rs 24,000-crores loan from Alok Industries are in a fix with the Small Industries’ Development Bank of India (SIDBI) filing a winding-up petition against the company in the Bombay High Court. The bank has filed the petition under Sections 433 (E), 434 and 439 of the Companies Act seeking to wind up Alok Industries and liquidate its assets. According to sources, SIDBI is not part of the 30-lender consortium to the company and is, therefore, classified ‘other lender’ in its annual report.
Earlier, efforts to initiate a strategic debt restructuring (SDR) scheme has had no results because the Bombay HC stayed the company’s sale of assets and change in its equity structure after HSBC filed a winding-up petition against it. The London-based bank had filed the petition on behalf of unsecured lenders like VTB Capital to settle the outstanding dues worth $55 million. Other petitioners include Barclays Bank, Shreeji Steel Traders, Netherlands Development Finance Company (FMO) and Global Tradinglinks.
Alok Industries is currently ineligible for a loan recast even under the revised rules for sustainable structuring of stressed assets (S4A) scheme. It has been recently reported that a techno-economic viability (TEV) study found sustainable debt to be at Rs. 10,800 crores, slightly less than 50 per cent of the firm’s total debt.
Bankers, however, are hopeful that the RBI will respond favourably to suggestions asking for some relaxations in the formula for calculating the sustainable debt. Currently, lenders can invoke the S4A only in companies where 50 per cent borrowings are sustainable or can be serviced by current cash flows.
Increasing importance of denim in Vietnam’s apparel industry is instrumental in bringing another edition of Denimsandjeans show to Ho Chi Min City in June, 2017. With the first Denim Show in Vietnam launched by India’s Denimsandjeans.com team, the second edition in June 2017 would attract leading denim jeans and fabric companies besides chemical, accessory and other suppliers in the denim supply chain.
Over 50 companies from Vietnam, China, Indonesia, Hong Kong, India, Pakistan, Bangladesh, Brazil, Italy, Switzerland, Japan, Thailand, Taiwan and some other countries are expected to participate in the show. Vietnam, exported about $27 billion apparel and textiles last year is expected to grow to $30 billion by the end of 2016. Denim is increasingly taking a share of these exports.
The maiden international denim show in Vietnam was held in June 2016 by Denimsandjeans while the second edition with the theme Street Style seeks to highlight the importance that denim holds in the realms of street play.
