FW
Southern India Mills' Association (SIMA) has decided to partner with other textile associations to understand domestic demand for yarn and fabric regularly and to initiate measures to revive the market.
According to M. Senthilkumar, Chairman of the association, SIMA already had a meeting with members of Powerloom Development and Export Promotion (PDEXCIL) on Friday. The domestic yarn market is down for the last 18 months. As against the potential to produce 350 million to 352 million kg of yarn a month, the spinning sector was producing only about 345 million kg a month. Similarly, in weaving clusters such as Bhiwandi, the powerloom units were operating only 60 per cent to 70 per cent of the capacity.
Initially, the association would tie-up with PDEXCIL to study the yarn and fabric market in Tamil Nadu. This would be extended to handloom and knitting segments soon. In Tamil Nadu, most of the units were sending the yarn and fabric to the northern states for processing.
www.simamills.org
The second phase of China-Pakistan Free Trade Agreement (CPFTA) negotiation round was recently held in Beijing between Pakistan and China, which failed to reach its conclusion.
Sources claim that during the talks between both these countries, Pakistan expressed its concerns regarding insufficient utilisation of concessions given by China to Pakistan and competition faced by local industries due to cheap imports from China. Pakistan demanded exclusion of 20 per cent of total products from the concessions because of dumping of goods from China into Pakistan's local markets. However, China showed willingness to exclude only 10 per cent of total products in the second phase under the WTO rules.
The CPFTA on trade in goods was signed on November 24, 2006 and implemented from July 1, 2007. FTA on Trade in Services was signed on February 21, 2009 and is operational since October 10, 2009. Rising imports of Chinese goods into the Pakistani domestic market is adversely impacting the local manufacturers and they have been appealing to the Ministry of Commerce with complaints of under-invoicing and non-declaration with regard to imports from China.
Pakistan-China volume of trade that was in the region of $4 billion in the year 2006-07, reached an all-time high at $10.19 billion in 2013-14. Pakistan's exports have soared to $2.4 billion in 2013-14 from $575 million in 2006-07. Correspondingly China's exports to Pakistan have increased to $7.77 billion in 2013-14 from $3.5 billion in 2006-07. Pakistan's major exports to China are cotton yarn, fabric, rice, raw hides and skins, crude vegetable material, chemical material, etc. While major imports from China are machinery (all sorts) and its parts, yarn and thread of synthetic fiber, vegetable and synthetic textile fibre, among others.
Pakistan has secured market access on products of immediate export interest like cotton fabrics, blended fabrics, synthetic yarn and fabrics, knit fabrics and home textiles. During first three years of implementation of Phase-I, both sides reduced tariffs on almost 36 per cent tariff lines to zero duty.
Returning to Turkey for the first time in more than a decade, IWTO brought together 75 representatives of the global wool textile industry for its annual Wool Round Table in Istanbul on November 23-24, 2015.
Hosted by Yünsa, one of the world’s top producers of worsted wool fabric, at their headquarters in the Sabanci Center, attendees came from Argentina, Australia, China, France, Germany, Italy, New Zealand, South Africa, the United Kingdom, the United States, and Uruguay as well as Turkey for the two-day event. The Wool Round Table provides a platform to shre ideas and dig deeper into industry issues. Organised with the support of IWTO member the Turkish Textile Employers’ Association, this year’s edition drew inspiration from presentations by representatives of the Turkish wool industry before turning its attention to a workshop focused on developing a global industry vision for the next ten years.
Turkey is the world’s sixth largest exporter of textile and ready-to-wear, whose importance in the global supply chain has been growing exponentially. Benefitting from the upturn in the general global economy, especially in North America, IWTO President Peter Ackroyd in his opening remarks highlighted the current expansion of Turkey’s wool production. The Turkish industry is further keen to maximise its adjacent position relative to the EU, he noted, as retailers for environmental reasons increasingly seek proximity in the supply chain. The European market is one of the most important for Turkish wool fabric and apparel.
Taking inspiration from the opportunities for the Turkish textile and clothing sector, the focus of the remainder of the Wool Round Table turned to a collective examination of a longer term vision for wool. Part of an IWTO-led development of a wool textile industry roadmap to 2025, the workshop format IWTO generated lively discussions among industry members as they formulated recommendations and challenged assumptions. Initial outcomes highlighted the need for consumer education, further work to bolster environmental ratings of wool and stronger collaborations within the industry as key areas for future emphasis.
These outcomes will be further developed and reported in the coming months and will include the results of IWTO’s Wool Vision Survey, conducted earlier this year as part of the 2025 project. IWTO also announced that IWTO member the Turkish Textiles Employers’ Association will host the annual IWTO Congress in Istanbul in from May 15 to 17, 2017.
www.iwto.org
The two trade fairs for eco-conscious fashion, Greenshowroom and Ethical Fashion Show Berlin, will be presenting a high-calibre programme between January 19 and 21, 2016. Highlights of the two fashion shows include ‘Salonshow’ and ‘Ethical Fashion on Stage’. In addition, a showcase, talks, podium discussions and press tours will offer visitors innovative information and networking opportunities.
The line-up of exhibitors includes over 160 labels. More than 40 of these labels will be exhibiting in the Greenshowroom – a mix of popular names from the eco-fashion segment as well as newcomers. “We are particularly pleased with the strong support for the event from the high-fashion segment. This will enable visitors to experience a broad range of green fashion,” states Olaf Schmidt, Vice President Textiles & Textile Technologies for Messe Frankfurt.
After inauguration on January 19, 2016, the event programme will kick off with a podium discussion entitled: ‘Eco-fashion on the shop floor’. Among other topics, representatives of fashion brands and manufacturers will discuss how eco-fashion can be integrated into conventional retail ranges. The afternoon of the first day of the fair will be dominated by fashion shows, opening with the ‘Salonshow’ as the official offshoot event of the Mercedes-Benz Fashion Week Berlin. Designers at the Greenshowroom will present select high-fashion looks from their 2016/17 Autumn/Winter collections at the Postbahnhof. Part two of the fashion show programme will witness the ‘Ethical Fashion on Stage’ catwalk show, presenting streetwear and casualwear.
On Wednesday, further talks on current developments in sustainable fashion will be the focus. The podium discussion held as part of the “Create Green Breakfast” on Thursday, January 21, 2016 is dedicated to the topic of the circular economy. Guests including Michael Braungart, co-founder of the cradle-to-cradle design concept, Friederike von Wedel-Parlow, Director MA Sustainability in Fashion at ESMOD Berlin, and Brett Mathews from MCL Global will discuss the circular economy, cradle-to-cradle design and new techniques drawing on recycling and recycled materials.
As part of a special outdoor showcase, Ethical Fashion Show Berlin will highlight the recycling of textiles using innovative technologies. The showcase will be organised by GreenroomVoice. The Swiss company focuses on making the environmental and social efforts of outdoor fashion brands more transparent. Together with its partners, GreenroomVoice will present an insight into the state of the art in the outdoor fashion industry. Both established and up-and-coming outdoor labels will be featured.
www.messefrankfurt.com
While the production of polyester fabric faced critical situation amid the ongoing agitation by textile workers, flooding situation due to incessant rain in Tamil Nadu has further made a further adverse impact on the textile business in the state.
Industry insiders estimate the order cancellations to be worth Rs 300 crores by buyers in Chennai in the past fortnight because of the non-stop rains. Out of Rs 110 crores worth of daily supply of saris, home textiles and dress materials from Surat, textile products to the tune of Rs 30 crores are despatched to markets in southern India. Supply to Chennai has come down to 80 per cent in the last few days because of the situation.
Surat, which happens to be the major supplier of fabrics to the southern states is facing the worst with weak demand for polyester fabric and payment defaults to the tune of over Rs 150 crores coupled with the ongoing workers' agitation. Over 3.5 lakh powerloom machines have stopped work in over 12,000 units in Jolva, Palsana and Laskana in the last two weeks because of the workers’ demand for wage hike.
The UK Fashion & Textile Association (UKFT) has announced that Chief Executive Officer John Miln will be stepping down and Adam Mansell will step into his role as of January 2016.
Having held the position since 2011, Miln’s leadership has been instrumental in the growth and success of the association as it now stands and the businesses it has helped develop and grow. Prior to UKFT, Miln’s entire career has been in textiles and apparel, working in global multinationals, UK branded enterprises and SME’s in various senior executive board roles in the UK, Europe and internationally. Miln will stay on as a Consultant to UKFT.
Adam Mansell, current Director of Special Projects at UKFT, will succeed John Miln and assume the role in January 2016. As Director of Special Projects at UKFT, his focus has been on increasing the membership offer, including overseeing the introduction of a new Retail Partner Programme, as well as introducing the UKFT Masterclasses and running an environmental programme, which has seen UK dyers and weavers significantly reduce their CO2 emissions.
Along with his work at UKFT, Mansell is a Director of Wulff Consultancy; a consultancy for the fashion and textile industry and has recently been elected as President of Ginetex, the organisation that owns the trademarked care labelling symbols. Having previously worked in the accountancy and publishing sectors, Mansell joined the textile and clothing industry 20 years ago. With experience representing all aspects of the fashion and textile supply chain, he has links to every part of the industry from design, fabric and component suppliers, wholesalers, brands, manufacturers and retail.
www.ukft.org
The government is likely to concede to Congress’ demand to do away with the one per cent tax on interstate sales, which was proposed to compensate manufacturing states such as Maharashtra, Gujarat and Tamil Nadu who feared a loss of revenue in the new indirect tax regime. The government, however, is keen to keep rates reasonable so that any inflationary impact of the goods and service tax is contained.
The proposed GST seeks to replace excise duty, service tax, value added tax, entry tax and octroi with a single levy and create a unified national market in the country from April 1, 2016. GST has been touted as the most comprehensive reform of indirect taxes since independence. It’s estimated it could lift the country’s GDP growth by one to two percentage points.
The tax will be levied on manufacture, sale and consumption of goods and services. It will transform India into a uniform market by breaking the current fiscal barrier between states. GST will facilitate a uniform tax levied on goods and services across the country.
GST will facilitate a climate of improved tax compliance. It also offers a solution to multinationals as it breaks down the indirect tax structure into one single tax payable by the companies.
Andhra Pradesh government is planning to waive loans to the handloom and power loom sectors. Under this scheme, loans worth Rs 110.96 crores will be put off. The loan waiver would be implemented from January 2016. To be implemented at one go, the scheme will benefit 24,209 weavers whose total loans amounted to Rs 82.84 crores. Besides this loans worth Rs 11.83 crores availed of by 674 weaving clusters and Rs 16.27 crores borrowed by 584 power looms would be waived.
Loans against weavers’ credit cards and individual loans up to Rs 1 lakh, weavers’ group loans up to Rs 5 lakh, loans up to Rs 1 lakh availed of by power loom units with a below five HP power connection and availing of the 50 per cent power subsidy scheme will be eligible for the loan waiver under the scheme.
Andhra Pradesh is an important state for handloom. There are about 2,00,310 handloom weavers in the cooperative fold and 1,58,902 outside the cooperative fold. There are about 81,000 power looms working in the state. The handloom industry has the advantage of flexibility of small production quantities, being amenable to innovations, low investment, labour intensive and adaptability to market requirements. India has the world's largest installed base of looms.
"An estimated $48 million in duties are levied on US exports of textiles and apparel products in TPP markets including Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, every year and $835 million were levied in new TPP markets such as Brunei, Japan, Malaysia, New Zealand, and Vietnam in 2014. Certain textiles and apparel exports face tariffs as high as 34 per cent in new TPP markets however, the report indicates that the US would be able to report duty savings in year one under TPP and savings from the new TPP markets may be as high as $932 million."
A factsheet released by the US Department of Commerce reveals, the Trans-Pacific Partnership (TPP) will create exciting export opportunities for the US textile and apparel industry. The report highlights Vietnam and Japan as the two promising markets in TPP for certain textile and apparel products ‘Made in USA’.
New opportunities open up
Products from the US textiles and apparel sector include man-made fibres, yarn, knit and woven fabric, non-wovens, industrial and advanced textile materials, knit and woven apparel, carpets and rugs, and home furnishing products. The report states that Japan will eliminate import taxes on 99.2 per cent of US textiles and apparel exports immediately and Vietnam will eliminate import taxes on 98.4 per cent and 100 per cent within four years. Malaysia too will eliminate import taxes on 79.2 per cent and New Zealand – 50 per cent immediately with the latter increasing the limit to 100 per cent in seven years, on US textiles and apparel exports.
An estimated $48 million in duties are levied on US exports of textiles and apparel products in TPP markets including Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, every year and $835 million were levied in new TPP markets such as Brunei, Japan, Malaysia, New Zealand, and Vietnam in 2014. Certain textiles and apparel exports face tariffs as high as 34 per cent in new TPP markets however, the report indicates that the US would be able to report duty savings in year one under TPP and savings from the new TPP markets may be as high as $932 million.
Opportunities for select textile products
The United States is a globally competitive manufacturer of textiles. Textile industry workers are highly skilled and the industry is technologically advanced, with investments of $1.6 billion in total capital expenditures in 2013. In recent years, US textile companies have focused on retooling their businesses, finding more effective work processes, and investing in niche products and markets.
In 2014, the United States exported $394 million worth cotton fibre, yarn, and woven fabric to Vietnam, making the United States the second largest supplier of such products to Vietnam, behind China. US exporters hold 16 per cent of the Vietnamese market for these goods even though they face tariffs of up to 12 per cent. Under TPP, Vietnam will eliminate these tariffs immediately, giving US cotton textile manufacturers an opportunity to increase their already significant exports to the Vietnamese market.
Since 2009, US exports of synthetic fibres, yarns, and fabrics to Japan have grown by 61 per cent, and last year US manufacturers exported $91 million of these products to Japan. However, US exporters face tariffs on their goods ranging from 2.7 per cent to 10 per cent. However, under TPP, these tariffs will be eliminated immediately, further opening the Japanese market to US synthetic textile manufacturers.
In 2014, the United States exported $91 million of industrial and advanced textile fabrics to Japan, where the United States is the fourth largest supplier of these fabrics, behind only China, South Korea, and Taiwan. Similarly, in 2014, the United States exported $27.7 million of industrial and advanced textile fabrics to Malaysia, where the United States is the second largest supplier of these fabrics, behind only China. US exports currently face tariffs of up to 8.2 per cent in Japan and 20 per cent in Malaysia and under TPP, nearly all these tariffs will be eliminated immediately further benefiting the US exports.
Japan, Vietnam open-up opportunities
Vietnam has a vibrant and rapidly expanding textile industry. The Vietnamese market offers tremendous opportunity for all types of US textile businesses and workers, including producers of nonwoven fabrics used, for example, in filtration, surgical gowns, and protective apparel. Exports of non-woven fabric to Vietnam are an especially promising opportunity for US manufacturers. US exports of non-woven fabric to Vietnam grew an impressive 951 per cent from 2009 to 2014, to $23 million. The United States will continue to see export growth in this sector. Under TPP, Vietnam will eliminate its tariffs on non-wovens, which average 12 per cent, immediately.
The ‘Made in USA’ label has great appeal in the Japanese market. One segment with significant potential for US-made product is men’s and boys’ trousers and knit shirts. Japan is the fifth largest market for the United States in these product areas, behind Canada, Mexico, Honduras, and the United Kingdom. US exports of men’s and boys’ trousers and knit shirts totalled $32.6 million in 2014, an increase of 30.9 per cent from 2009. Under TPP, Japan will eliminate its tariffs on these products, which average 9.8 per cent, immediately. Since Japan is a fashion leader across Asia, success in Japan can significantly raise a brand’s visibility in other Asian markets.
One of the most important trends in the domestic textile industry is the growing role of industrial and advanced textiles, which are manufactured primarily for their technical performance and functional properties, rather than their aesthetic or decorative characteristics. Industrial and advanced textiles are used in the aerospace, industrial, marine, medical, military, public safety, and transportation fields. The global industrial and advanced textile industry has seen rapid growth in the past few decades, and Japan has become a prime location for the consumption of industrial and advanced textiles. US exports of industrial and advanced textile materials to Japan totalled $90.6 million in 2014, an increase of over 100 per cent from 2009. Under TPP, Japan will eliminate its tariffs on these products, which average 4.2 per cent.
Benefits for domestic manufacturers
The most sensitive products to domestic industry, such as sweaters, shirts, trousers, and industrial textiles, will be subject to lower up-front tariff cuts and longer tariff phase-out periods than other textile products, reflecting careful consideration of US domestic interests and helping to preserve commercial relationships with Western Hemisphere trading partners.
The “yarn-forward” rule will promote the use of fibres, yarns, and fabrics made in the United States and other TPP countries, ensure that domestic manufacturers have an opportunity to develop new business in the region, and incentivize foreign direct investment in regional textile manufacturing.
TPP includes a special textile safeguard mechanism which will provide for temporary re-application of tariffs if imports under the agreement are shown to be causing or threatening to cause serious damage to domestic industry. The report points out that significant cuts or duty-free treatment on all apparel tariffs, which can be as high as 32 per cent, on day one of the agreement will provide meaningful opportunities for brands and retailers to realise millions of dollars in cost savings. The TPP will give brands and retailers flexibility to source inputs from outside the TPP countries if they are not commercially available from TPP suppliers.
www.trade.gov
Traders and analysts expected the current cotton season from August 2015 to July 2016 in Pakistan to produce a record cotton output of nearly 15 million bales (155 kgs). However, the current situation indicates that the country will miss that projection by a wide margin. According to traders in Karachi, a toxic mixture of poor cottonseeds supply for sowing purpose, poor weather conditions and consequent pest attacks have adversely impacted this year's cotton production by nearly four to five million bales (155 kgs).
Thus the cotton output for Pakistan for the current season (2015/2016) is expected to be between 10 to 10.5 million bales (155 kgs) while the textile mills are projecting their consumption between 14 and 14.5 million bales. Imports of cotton this season may range from 2.5 to 3 million bales, while the exporters may ship anywhere from 300,000 to 350,000 bales.
On the other hand, manufacture and sale of yarns and other textiles continue to witness a downward trend. According to the cotton arrivals report of the Pakistan Cotton Ginners Association (PCGA) showing seed cotton (Kapas/Phutti) arrivals for the current season (2015/2016) in Pakistan till the 1st of December, 2015, at 8,631,933 lint equivalent bales (155 kgs) compared to 12,145,705 bales received for this period during the last season (2014/2015), or a decrease of 28.93 per cent. Domestic mills have picked up 6,289,826 bales. An unsold quantity of 1,989,708 bales is lying with the ginners in both pressed and loose form.
