FW
"Hong Kong’s textile exports seen degrowth lately. In 2016, it fell 13 per cent and now another 7 per cent in the first five months of 2017. Re-exports, accounting for more than 99 per cent of total textiles exports, also fell 7 per cent, while domestic exports rose 2 per cent. With more than three-quarters of the textile re-exports originating from Chinese mainland, Hong Kong’s re-exports of textiles of China origin registered a decrease of 6 per cent in January-May 2017."
Hong Kong’s textile exports seen degrowth lately. In 2016, it fell 13 per cent and now another 7 per cent in the first five months of 2017. Re-exports, accounting for more than 99 per cent of total textiles exports, also fell 7 per cent, while domestic exports rose 2 per cent. With more than three-quarters of the textile re-exports originating from Chinese mainland, Hong Kong’s re-exports of textiles of China origin registered a decrease of 6 per cent in January-May 2017.
Asia accounted for 93 per cent of Hong Kong’s textile exports in the first five monthsof 2017. Other major export markets of Hong Kong textiles include Vietnam, Bangladesh, Cambodia, Indonesia, Sri Lanka, the US, India, Thailand and the Philippines. In particular because of Vietnam’s cheap labour compared to neighbouring countries and WTO membership, many foreign investors, including those from Hong Kong, have set up garment factories there. This gives rise to sustained demand for textile imports, making Vietnam the second largest market for Hong Kong’s textile exports, after the Chinese mainland. Talking about products, Hong Kong’s exports of knitted or crocheted fabrics, textile yarns, woven fabrics, textile made-up and floor coverings registered respective declines of 3 per cent-64 per cent in the first five months of 2017. However, finishing accessories and special yarns and fabrics increased by 3 per cent and 2 per cent, respectively, in the first five months of 2017.
Industry trends
With rising labour costs, volatile raw material prices and stringent environmental regulations on the Chinese mainland, many Hong Kong's textiles manufacturers have relocated their production facilities to other South-east Asian countries, like Vietnam, Cambodia, Myanmar and Bangladesh. A few companies have even set up offshore production in Latin America (e.g. Mexico) and Africa (e.g. Nigeria) to take advantage of preferential treatments allowed by regional trade agreements such as North American Free Trade Agreement (NAFTA) and the EU’s GSP scheme.
Product trends
Among various kinds of fibres, cotton remains the most preferred material for consumers. Cotton-rich apparel continues to attract European consumers, while consumers in China, India and Japan agree that cotton and cotton blend are the most comfortable, authentic and sustainable, compared to other man-made fibres. Microfibres are attracting textiles manufacturers as they are light in weight and have superior performance in keeping warm. These days more and more breathable, flexible, anti-bacterial, anti-ultraviolet, wrinkle-free, water-resistant and eco-friendly materials are invented and marketed. For instance, TENCEL® invented by Lenzing Group is a kind of lyocell fibre that possesses several functional advantages over cotton, while Salvatore Ferragamo has pioneered the use of sustainable fabrics made from citrus fruit.
Technovation
Technology and innovation are yet again set to rule the textile world. Fancy weaves and prints will give more flexibility in the choice of manufacturing processes, while digital prints, as well as artisanal decoration, will make textiles more malleable. Additionally, hand-crafted excellence, original visuals and exceptional handles will continue to be sought after, given consumers’ ever-growing appetite for uniqueness and distinctiveness. Solar-powered handbag made of a textile photovoltaic surface that powers a battery inside to charge a mobile phone and ‘climate costumes’ that sense changes in carbon emission with light patterns using conductive thread and LEDs are just some examples of how technical textiles are shaping the future textiles industry. As wearable technologies are becoming more accessible, technical textiles are widely applied over a wide range of industries such as automobile, aerospace, architecture, healthcare and sports. Luminescent and heated garments as well as smart knee bandages are cases in point.
Eco-consciousness
To comply with global trends of green manufacturing, more textile corporations have adopted the bluesign® standard – one of the industry’s major voluntary standards for environmental sustainability. Consumers in West Europe, the US and Japan, are stringent about the environmentally friendly properties of biodegradable natural fibres like organic cotton, soy fibre and ahimsa silk. To keep up with this trend, manufacturers have also expanded their production of green textiles by utilising more bio-degradable materials and environmentally-friendly manufacturing processes, including high-efficiency management practices, process control, special processes, and recycling of wastewater.
Product safety
Besides going green, companies are paying utmost attention on product safety. For instance, a number of disqualified apparel fibres consisting of unsatisfactory levels of pH value, formaldehyde content and banned azo dyes have been reported on the Chinese mainland in recent years. In fact, Chinese consumers are increasingly in favour of foreign apparel brands, which usually guarantee product safety. Meanwhile, in traditional markets, for example, the EU’s Rapid Alert System for Non-Food Products (RAPEX) revealed that textiles, clothing and fashion items were the third most common product category notified (behind only toys and motor vehicles), representing 13 per cent of the total number of notifications of dangerous products in 2016.
Three day, Cairo Fashion and Tex will be held from September 13 to 16, 2017. This is an exhibition for specialized in yarns, textiles, garments and trimming supplies and accessories. Among the exhibits will be cotton fabrics, linen, shawls, jute apparel, travel bags, perfumes, textile finishing machinery, cosmetic sets, sports wear, medical clothing, sport socks, casual apparel, shoes and blazers.
India too put up a pavilion to enable Indian companies get first-hand inputs about the status of Egyptian market in terms of textiles, and specific preferences of Egyptian customers about products, designs and colors, the Synthetic and Rayon Textiles Export Promotion Council will visit Cairo for a recee and get an idea of buyers’ requirements and enable Indian participants to present what’s trending and in demand.
Egypt has established strong links between production and exports to form a harmonious scheme aiming at boosting exports and upgrading the national industry through modern international technology and expertise.
The show will be attended by professionals, key decision makers, buyers, suppliers, traders, distributors and more. India is the world’s second largest producer of synthetic fiber, yarn, cotton, cellulosic fiber as well as silk.
The Alliance for Bangladesh Worker Safety recently announced that during the month of July, 26 additional Alliance-affiliated factories completed all material components outlined in their Corrective Action Plans (CAPs), bringing the total number of factories to have completed their CAPsto 118.
These include: Ananta Casualwear, Adhunik Poshak Shilpa, Alamode Apparels, Alliance Knit Composite, Rising Knit Textiles, Salek Textile, Shams Styling Wears, Thanbee Print World, That’s It Garments, Tip Top Fashions, Voyager Apparels and Wear Mag.
Each garment worker has a right to a safe workplace, says Alliance Country Director Jim Moriarty. This past month’s success reinforces the confidence that Alliance factories will have substantially completed remediation and bewell on the way to developing a sustainable culture of safety before the Alliance sunsets in 2018.
The Alliance also continued to enforce accountability measures for factories that failed to make adequate remediation progress. In July, one factory was suspended from the Alliance compliant factory list, bringing the total number of suspended factories to157.
The complete list of factories that have achieved substantial completion of their CAPs, as well as those that have been suspended, can be found on the Alliance website.
This 5 percent GST rate reduced from 18 per cent announced earlier, will be applicable for job works in apparel, shawls and carpets.
Acceding to demands from the industry, The Goods and Services Tax (GST) Council decided to reduce the GST rate on all job works related to the textile and apparel sector to 5% from 18%. In case of some sectors like yarns and fabrics, the tax on job works was earlier slashed to 5%, but with Saturday’s decision, the benefit of lower tax will be available to all job works in the sector. In a move that would cut the cost of project execution in the government sector, the GST on work contracts in the state-sector has been reduced 18% to 12% with full input tax credit.
SIMA hails GST reduction on textile job work.
The Southern India Mills Association (SIMA) welcomed the centre's move to bring down the GST rate on textile job work from 18 per cent to 5 per cent. All the textile job works, being the manufacturing activities, had been exempted from the service tax in the pre-GST regime. But, the job workers could not avail the input tax credit that had been increasing the cost of the products and affecting the export competitiveness and also the domestic consumers, a release from SIMA said.
Therefore, the industry has been demanding to classify all the textile job works under 5% GST rate service list. But, the GST council had classified only the textile yarns (other than MMF and filament) and textile fabrics under 5% and therefore all other job works especially garments and made-up that creates 70 to 120 jobs per Rs 1crore of investment, especially for the rural masses and women folks were affected due to inverted duty. In addition, over 85% of the textile manufacturing units under take only job work.
M Senthilkumar, chairman of SIMA said 5 per cent GST rate on job works would enable to take full input credit and also avoid any inverted duty and strengthen the global competitiveness of the textile industry apart from benefiting the domestic consumers.
Garment manufacturers cheer GST rate cut in job work.
Garment manufacturers too have welcomed the government's decision to cut service tax (goods and services or GST levy) on the third-party services popularly known as job work.
"We welcome the decision. This is a major relief for the garments sector. The rate of 18 per cent was the biggest impediment for the growth of the garments sector. With this relief garment sector in India will see a major jump in coming days," said Rahul Mehta, President, Clothing Manufacturers Association of India.
In the unorganised garment sector, almost 75 per cent depends on job work such as stitching, trading and other associated work. The sector feared hundreds of thousands of job losses with high tax on third party work.
"It was a great platform for companies eying to connect with British brands, at the recently concluded London Textile Fair, held at the London Design Centre in Islington. As John Kelley, show organiser and Textile Events owner, says there was a huge range of fabric producers, print studios and accessories and a strong showing of knitters. Exhibitors say they mostly supplied to fast fashion and mid-market brands such as Topshop, River Island, Zara and Marks & Spencer. More specialists and high-end exhibitors mentioned higher brands and independent and start-up designers were visiting their stands."
It was a great platform for companies eying to connect with British brands, at the recently concluded London Textile Fair, held at the London Design Centre in Islington. As John Kelley, show organiser and Textile Events owner, says there was a huge range of fabric producers, print studios and accessories and a strong showing of knitters. Exhibitors say they mostly supplied to fast fashion and mid-market brands such as Topshop, River Island, Zara and Marks & Spencer. More specialists and high-end exhibitors mentioned higher brands and independent and start-up designers were visiting their stands.
India connect
The show attracted Indian companies like Handmade in Rajasthan who represented artisanal weavers, printers and embellishers who are now working with contemporary fashion designers, to Peruvian cotton textile producers. A new exhibitor from Bulgaria, Nitex ideally positioned geographically for short orders and near shore production was also there. The company, ships a lot to Turkey for the German market, and to or three good garment makers in Bulgaria.
Turkish dominance
There were close to 118+ exhibitors from Turkey showcasing products across the range of textiles, including cottons, stretch lace, fancy fabrics and a strong showing of Jacquards. Turkish knitting company specialises in fashion and scuba fabrics, with embossed fabrics as their star turn. Turkish exhibitors said they are still doing bulk, despite the emerging trend for short orders from near-shore providers. Fatih Eraslan of DILEK a producer of stretch fashion and sports stretch fabrics in Bursa, said that they produce 3.2 million metres per year and are are still doing bulk orders especially for Mango, from whom they got an order for 100,000 metres. Among big brands like H&M and Zara, they are using Turkish fabrics for Europe as they are paying a higher tag price. Turkish companies were supported by Istanbul Textile and Raw Materials Exporters Association iTHiB, who payed 50 per cent of the stand fee for exhibitors.
Towards sustainability
Sustainability was in focus at the trade show. Talking about new fabrics, Jason Body of Urban Fabric representing Italian fabric company Primatex and German company Kindermann, said they brought out new collections using wool and recycled cotton from denim, from old recycled denim garments. Jason said they are pushing the manufacturers to do recycle, or organic because demand for these products are increasing.
Carmen Pinto of Vilartex, one of 15 Portuguese fabric companies exhibiting, pointed out things are changing as this is the first time people are asking for organic items. Vilartex has specialist collections of indigo dyed and sustainable fabrics that attracted customers. Carmen feels if fabric producers do not take the initiative about producing sustainable fabrics, the market will change even more slowly.
In cotton, there is BCI certified fiber, which is more a social certification and big brands have goals till 2020 to get all their cotton from BCI, they are interested but the price is always a problem. The big problem for fabric producers, particularly in the UK market, is price.
Safexpress has opened a logistics park in Hyderabad spanning 4,00,000 sq ft. This is one of India’s largest supply chain and logistics facilities. The park will enable Safexpress to provide clients with cutting edge transhipment as well as 3PL services. It is strategically located and will serve as the nodal point for supply chain and logistics across Telangana and serve warehousing needs of companies.
The facility is a mix of environment-friendly initiatives and technology. Safexpress has invested in rainwater harvesting, developed a special green zone and robust IT systems to support operational efficiencies and inventory visibility.
Companies can resort to outsourcing their supply chain and logistics needs to a GST compliant 3PL service provider like Safexpress, while keeping their own warehousing and hub infrastructure to minimal levels. Keeping these factors in mind, Safexpress has hugely augmented its 3PL network by creating 32 ultra-modern logistics parks spread over 13 million square feet.
The logistics park at Hyderabad will be operational 24x7, 365 days a year to provide time-definite deliveries. Safexpress offers a wide range of innovative supply chain services including express distribution, 3PL and consulting. The firm provides value-added logistics services for eight different business verticals ranging from apparel and lifestyle, health care, hi-tech, publishing to automotive, engineering and electrical hardware, FMCG and consumer electronics.
United Apparel Fiji has become the first company in the Australasia region to attain platinum status as a Worldwide Responsible Accredited Production (WRAP) facility.
The company has been a WRAP gold certified facility for the past two years and had attained gold status at the first attempt. It is a strong believer in the continuous improvement process.
Platinum certifications are awarded to facilities that have demonstrated full compliance with WRAP’s 12 principles for three consecutive certification audits. A platinum facility has to successfully pass every audit with no corrective actions or observations and maintain continuous certification with no gaps between certification periods.
WRAP is the world’s largest independent certification program and mainly focuses on the apparel, footwear and sewn products sector. The WRAP certification program’s objective is to independently monitor and certify compliance with these standards to ensure that sewn products are being produced under lawful, humane and ethical conditions.
Participating facilities voluntarily commit to ensuring that their manufacturing practices will meet these standards and further commit to passing along, on their part, the expectation that their contractors and suppliers likewise comply with these standards.
United Apparel is one of Fiji's leading garment production facilities in the industry, equipped with the latest in advanced manufacturing technology.
Production of Tamil Nadu textile manufacturers is expected to reach Rs 75,000 crores by 2020 up from Rs 50,000 crores now. The state ranks third in textile production and exports in India. Spinning, handloom, powerloom and garments are the four pillars of textile sector in the state.
The industry in Tamil Nadu has seen highs and lows in the last few years. At one time it had to face a power problem. Adequate power is the lifeline of the industry. Utilization fell to about 70 per cent. In some of the smaller mills, without captive generation plants, it went down to even 60 per cent.
Currently India is looking to add around 3 to 3.5 million spindles a year against an average number of 2.5 million spindles over the past five years. The southern region is expected to contribute to about one million and more spindles every year.
Tirupur's textile industry does business worth over Rs 50,000 crores every year, including revenue earned from exports. The industry also employs over 1,000,000 people. Over 80 per cent units in the cluster are dependent on job work to carry out the various stages of garment manufacturing. The product is normally transported from one stage of processing to the other at least five to seven times before getting packed for shipment or for domestic sales.
Canadian brand Aldo is set to buy Vince Camuto, which sells men’s and women’s shoes, bags, clothing and accessories is part of the US-based Camuto. The Camuto Group produces shoes and apparel for brands including the Jessica Simpson Collection, Tory Burch and Lucky Brand Jeans.
The merger will create an impressive, large and scaled footwear operation. The takeover will give Aldo a bigger footprint at a moment when fashion brands are seeking growth through mergers and acquisitions.
Aldo was founded in 1972 by the son of a shoe merchant and the grandson of a cobbler. Aldo opened its first store in the United States in 1993 and now sells shoes in more than 3,000 locations worldwide. The company employs more than 20,000 people and has sales of about 1.5 billion dollars annually.
The brands will be kept separate, so there are no plans to sell Vince Camuto products in Aldo stores. Aldo’s takeover of the Vince Camuto brand is the latest transaction to reshape the fashion industry. Last week, Michael Kors said it would acquire Jimmy Choo for about 1.2 billion dollars. And in May, Coach agreed to pay 2.4 billion dollars to acquire Kate Spade.
Next year, global demand for cotton is expected to inch up three per cent over this year as yarn spinning mills in Bangladesh and Vietnam increase their production and China continues on a steady course as the world’s largest textile manufacturer. In the last four years, global demand has grown between one and 1.5 per cent per annum. With supply outpacing demand, cotton prices are expected to fall later in the year.
In the last few years, the cotton market has had a huge roller coaster, which makes it hard to plan and make commitments. China, the world’s largest cotton consumer and the second largest cotton producer, has gradually been selling off its huge stock of cotton it started warehousing in 2011 to support its farmers with premium prices. But cotton can’t be hoarded forever because it starts deteriorating. So, in late 2013, China started selling off its vast reserves, which peaked at 68 million bales and is now down to about 40 million bales but that is still about twice the annual production seen in the United States.
With China supplying most of its own cotton in the last few years, the two biggest export markets for US cotton have been Bangladesh and Vietnam as those countries increase yarn production.
