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Vietnam sees Australia as a great market for garments, handbags and leather footwear. Australia boasts of great purchasing power although its population is less than that of the US and Europe. Vietnam is second among the countries exporting footwear products to Australia.
In the first quarter of 2017, two-way trade between Vietnam and Australia reached AUS$1.35 billion. Vietnam exported goods worth AUS$687 million to Australia, up 8.3 per cent, while importing products worth AUS$665 million, down 18.6 per cent compared to the same period last year. During the period under review, Vietnam earned AUS$50 million from footwear exports to Australia, up 24.6 per cent, and AUS$42 million from garment and textile products, up 13.6 per cent.
Australia has a project that teaches Vietnamese companies how to produce higher value products made from Australian wool. They are taught about what yarns to buy, how to dye wool, and finish fabrics or garments made from it. At one time Vietnamese companies had no idea about making garments from wool. They generally used cotton, acrylic and polyester.
The next step in the setting up of wool manufacturing supply chains in Vietnam as Australia is establishing wool spinning plants in Vietnam. The focus will be on raw wool scouring and top-making, enabling greasy wool to be sold and exported directly from Australia.
"Exhibitors, experts and media held discussions about upcoming trends and dynamics of global fashion industry at the ongoing Hong Kong Fashion Week. They exchanged views from different markets. In his opening remarks Byron Lee, Senior Exhibition Manager said, “Despite clouds on the global textile horizon, this fair and Hong Kong in particular is standing tall.” According to research, in first six months of the year, Hong Kong has grown modestly by approx. 5 per cent, exporters’ confidence index also, for the first time in last couple of years, is pegged above 50 per cent."
Exhibitors, experts and media held discussions about upcoming trends and dynamics of global fashion industry at the ongoing Hong Kong Fashion Week. They exchanged views from different markets. In his opening remarks Byron Lee, Senior Exhibition Manager said, “Despite clouds on the global textile horizon, this fair and Hong Kong in particular is standing tall.” According to research, in first six months of the year, Hong Kong has grown modestly by approx. 5 per cent, exporters’ confidence index also, for the first time in last couple of years, is pegged above 50 per cent.
Other speakers included Lawrence Leung, Chairman, HKTDC Garment Advisory Committee and Kaylie Kan, Vice Chairman, Hong Kong Apparel Society. Sharing their insights about the fair, Lawrence mentioned in this edition quite a few new forums/features have been added, viz., ‘The Urban Clothing’ & ‘Fashionable Sportswear’. Besides new countries like Saudi Arabia, Vietnam, Canada & Nepal, overall 20 countries are presenting their know-how.
Stabilising global economy
Talking exclusively to FashionatingWorld, Lawrence said the global economy is on a recovery mode on the back of US economy stabilising. “Moreover, the EU is likely to revisit the figure of how long quantitative easing is required. But no one alone can pull the global economy out of woods in this ever connected and collaborative economy; especially when purchasing power of an individual globally is under pressure and clearly there is under trading in quite a few categories in the ever changing and evolving consumer behaviour matrix.”
Lawrence pointed out there is a clear rebalancing of power and sourcing hubs. “Notably, manufacturing is shifting base to newer production hubs. Case in point is China, which had a great economic vision of investing heavily into infrastructure, isn’t cheap any more. More and more Chinese companies are taking offshore manufacturing route by exploiting the cost arbitrage of low cost production centres such as Cambodia, Vietnam, Bangladesh, Myanmar and other competitive Southeast Asian countries. Chinese state policy/ vision is very clear and increasingly textile & clothing sector is consciously moving to hi-tech, advanced technology and value addition where it is profitably sustainable.”
Hong Kong gaining stronghold
Experts felt with inherent advantages, Hong Kong will continue to sustain its position as a apparel sourcing hub in the future. These advantages include: low cost of financing/ funding; supportive banking system and highly competitive and advance fintech/financial service sector; use of global language both in communication and deep understanding of the global buyers’ needs especially the US buyers from where it generates bulk of business; global laws are followed, which are easy to interpret and execute. It has been able to provide unmatched designing and innovative inputs at a time when fashion cycles are shortening and the buyer is desperately looking to develop some cutting-edge solutions and services to outperform competition. Superior logistics support and easy access of Hong Kong makes it a gateway to the East and West.
Union textile minister Smriti Irani inaugurated the country’s largest apparel trade show, the 65th National Garment Fair in Mumbai and released the show directory. Also present on this occasion were Kavita Gupta, Textile Commissioner, Sanjay Lalbhai, Arvind Group and Kishore Biyani, CEO, Future Group.
Around 50,000 retailers from all over India are attending the three-day B2B fair. On display are 1,005 brands from 822 exhibitors spread across around 6 lakh sq. ft. covering all the halls of the Bombay Exhibition Centre. The stalls was categorised into four zones: men’s wear, women’s wear, kids wear and accessories.
The business networking sessions continued with three sessions comprising agents and distributors; high street retailers; national chain stores and e-commerce companies. Speaking on the occasion Rahul Mehta President, Clothing Manufacturers Association of India (CMAI) said despite welcoming GST in textiles and garments, the government should reduce GST on job work for garments and made ups from 18 per cent to 5 per cent. He also gave an insight on the ‘ADHIGAM’ the new software designed for the textiles and garment manufacturers, traders and retailers to ensure GST compliance. The software automatically converts regular invoices to GST compliant invoices sending reminders to vendors/suppliers who have not paid tax at any stage of the textile value chain.
"Exports of technical textiles outside EU-28 increased year-on-year. This sector is a pillar of textile exports outside the EU with a 38 per cent share in 2016. The growth translated into almost €10 bn of exports, an increase of more than 2.4 per cent in value. With 20 per cent of technical textile purchases from the EU-28, the USA the biggest client."
Exports of technical textiles outside EU-28 increased year-on-year. This sector is a pillar of textile exports outside the EU with a 38 per cent share in 2016. The growth translated into almost €10 bn of exports, an increase of more than 2.4 per cent in value. With 20 per cent of technical textile purchases from the EU-28, the USA the biggest client.
With a plus 2 per cent year-on- year increase, menswear exports outside the EU-28 still accounted for 23 per cent of total clothing exports amounting to more than €5 bn. The leading buyer of menswear, Switzerland, reduced its purchases in value (-3.9 per cent). There was noteworthy double-digit growth in the value of exports to South Korea, Australia, Mexico, Serbia, Israel and Ukraine. The three major menswear products for export were trousers (32 per cent of category exports), shirts (19 per cent) and coats (17 per cent). Purchases of all three were up, thanks to the weak euro (€). Furthermore, exports of rugs and carpets outside the EU-28 expanded again strongly in value by +5.5 per cent. This sector represented 4.3 per cent of all textile exports outside the EU. Customer-wise, the four main buyers (USA, Switzerland, Norway and Russia) absorbed 49 per cent of exports of rugs and carpets outside the EU.
EU imports surge in home textiles and clothing
Homebuilding activity varied widely depending on the member state, and purchasing of homeware. Nevertheless, imported home textiles took advantage of lower average unit prices, resulting in a rise of plus 3.3 per cent in value corresponding to an increase of €192 million. This growth was mainly attributed to bed and home linen. Import of home textiles from outside the EU reached €6 bn and mainly divided among four countries: China (33 per cent), Pakistan (25 per cent), Turkey (16 per cent) and India (11 per cent). Besides, there were remarkable gains in value for Vietnam, Morocco, Taiwan and Ukraine.
In 2016, EU’s menswear imports increased to more than €20 bn (25 per cent of total clothing imports), with a plus 0.5 per cent increase in value and +4.4 per cent in volume terms, leading to a -3.7 per cent fall in the average unit price. Of the five main imported menswear items (trousers, shirts, coats, underwear, jackets), only shirts suffered weak demand. China remained the main supplier of menswear. In value terms, its share of total imports stood at 28 per cent, representing another year of steady decline. The EU-28’s second ranked supplier, Bangladesh, continued its rise adding +8.5 per cent to improve its market share. A comparable situation was observed in imports coming from Pakistan, which added +5.8 per cent in value.
Imports of womenswear reached €29 bn (36 per cent of total clothing imports), with a +0.8 per cent increase in value. Imports rose for the five main imported items: trousers, skirts and dresses, coats, blouses and underwear. China continued to be the main supplier but its share is being eroded year-on- year. Due to continued annual expansion of its import share, Bangladesh was inevitably next in line, with value increasing by +13.7 per cent. In third place, Turkey continued to be a preferred traditional supplier even with a slight dip of -0.3 per cent. Among other clothing articles, EU imports of worn clothing achieved an outstanding growth while pullovers & cardigans have pointed down.
Pitti Filati’s autumn/winter 2018-19 show showcased developments in yarn designs for knitwear and their importance to the industry. All concerns of encompassed which include: sustainable development, color trends, new, innovative performance yarns, yarns developed specifically for needs, such as the rapid growth of athleisure, fashion which works for the individual.
Fluffy brushed looks were popular. Designers fluffed up and increased the volume of yarns for a soft, winter feel. Animal fibers with intrinsic qualities of knops, twists and individual structures were highly prized in knits.
In addition to wool, mohair and cashmere, this year’s choices included baby camel, yak, and alpaca, sometimes mixed together in various combinations. Alpaca is the fiber for the new winter season. It is being used in pure form or mixed with other fibers to enhance the natural hues which occur, putting alpaca firmly into the limelight for knitwear, knitted dresses and outerwear.
Special effects with fringing, printing, differential dyeing and brushing included metallic looks, sparkle, and the mixing of various colors in shiny yarns like mohair and silk. Dramatic color choices included dark navy and black. Surfaces were cosy and volume made greater by means of knops, bouclés and twists as well as by brushing and teasing in wool collections. Melanges and mixes were frequent in order to achieve unusual color effects.
The latest data released by Pakistan Bureau of Statistics reveals cotton yarn valued at $1.134 billion was exported during 11 months of last fiscal 2016-17 as against the corresponding period last year. During the period from July-May, 2016-17, about 4,13,749 metric tons of cotton yarn valued at $1.134 billion was exported as compared to exports of 3,92,302 metric tons valued at $1.176 billion during the same period last year. Exports of cotton yarn during the period under review decreased by 3.64 per cent, as against exports during the same period last year, however exports of cotton carded recorded an increase of 71.94 percent touching $2, 39,000 as against exports of $14,000 during same period last year. In last 11 months, 237 metric tons of cotton carded or combed was exported from the country as against the 143 metric tons during same period last year.
During the period from July-May, 2016-17, about 23,451 metric tons of raw cotton worth $40.169 million was exported as compared to exports of 48,961 metric tons valued at $75.996 million during the same period of last year.
Bed wear exports from the country grew 3.22 per cent and touched $1.922 billion, as against exports of $1.86 billion during the same period last year. In last eleven months of the fiscal 2016-17, about 3,18,070 metric tons of bed wear were exported as against the exports of 3,03,054 metric tons during same period last year.
However, textile group exports from the country during last 11 months of financial year 2016-17 had recorded 1.98 percent negative growth and were recorded at $11.234 billion as compared to exports of $11.46 billion during the same period last year.
India’s technical textiles industry is growing at a fast pace, with an expected compound annual growth rate of 9.6 per cent between 2014 and 2023. In addition, India accounts for roughly 14 per cent of the world’s production of textile yarns and fibers. It is the world’s largest producer of jute, second largest producer of silk and cotton, and the third largest of cellulosic fiber. The readymade garment sector is currently the largest contributor to India’s total textile and apparel exports, accounting for roughly 41 per cent.
India’s growth rate has been boosted by initiatives, including its recent establishment of 75 apparel training and design centers to improve technical skills and offer training. The vast majority of technical textiles comes from Asia-Pacific, which accounts for almost half of the global technical textiles market.
China is the largest producer of both woven and nonwoven technical textiles in the region, and is currently responsible for 30 per cent of global production. A large workforce, strong domestic market and the advances it has experienced in textile technology make the country a very strong competitor in the global industry.
China’s leading position is followed by the Americas with 19 per cent of global production, India with 18 per cent, the EU with 16 per cent and the rest of the world with 17 per cent.
Vietnam’s garment and textile revenue increased for the first half of this year but experts say growth has not yet become sustainable. The national garment and textiles export value in the first half of the year grew 11.3 per cent year-on-year to $14.58 billion, higher than the growth rate of 6.1 per cent year-on-year in the same period of 2016.
Le Tien Trưong, Deputy General Director of the Vietnam Garment and Textile Group (Vinatex), says the results were a praiseworthy effort in the context of the unstable global economy. The country earned $6 billion from exports to the US, surging nearly 9 per cent; $2.3 billion to the EU, up 8 per cent; and $1.5 billion to Japan, up 12 per cent. Vietnam outstripped its competitors in garment exports during the period. According to the Trade Map, China experienced a decline of more than 5 per cent year-on-year, while Bangladesh saw a drop of 3.5 per cent, and Indonesia was down 5 per cent.
However, trade protectionism policy of US President Donald Trump’s administration and interest rate adjustment from the US Federal Reserve will threaten sustainable export growth. There is a high possibility that Vietnam’s competitors will further devalue domestic currencies to support exports as they did in 2016, says Truong.
The biggest hurdle for Vietnamese garments is competitors, especially China with large scale production and low costs. Vietnamese enterprises need to join the global supply chain with fastidious requirements of quality, prices and time of good delivery. Moreover, the auxiliary industry for the textile and garment sector has not yet developed. Low capacity in weaving and dyeing has led to local demand for textile fabric being unsatisfied. The domestic garment industry must import 70 per cent of fabric, causing unbalanced development.
Meanwhile, Vietnamese garment enterprises are mostly small- and medium-sized limited ability in accessing domestic and foreign markets. If they do not link with some large enterprises, these firms will find it difficult to survive and never have the ability to compete internationally.
India’s garment exports are expected to register a 15 to 18 per cent growth in fiscal year ’18. Rebate on state levies have been introduced to encourage exports. There is an additional 10 per cent subsidy for the garment and made-up segments, which means the home textile industry will effectively get 25 per cent capital investment subsidy on new machines they bring in, leading to efficiency and modernisation of the sector.
Subsidies have proved be beneficial for the sector and led to an increase in employment and attracted huge investments. The industry is looking at entering into CIS, Africa and Far East markets to increase garment exports, apart from its traditional markets of US and Europe.
The 18 per cent GST is expected to be a major blow to the small manufacturers, most of whom follow the job work basis of manufacturing. India’s readymade garment exports registered a positive growth of just 8.06 per cent in May compared to the corresponding period last year. The decline in growth is attributed to many reasons. One, though exporters are happy with the new rates announced under GST, they need to ensure compliance with GST for input credit for the already existing stock on June 30, which has lead to curtailment in production.
India is facing deficient rainfall in major cotton growing areas. While the middle, northern and eastern parts of India received above normal rainfall, the western and southern parts remained deficient. So, farmers are fearing a decline in yield. They had achieved record productivity and got better prices last year despite lower acreage. Encouraged by last year’s realisation, farmers have slowed down the speed of cotton sowing after over 50 per cent increase in acreage early this season.
The crop is projected to get delayed by at least a month and the yield prospect has got affected due to a delay in sowing. A delay in upcoming crop may prompt immediate bargains. The demand for cotton has been good. Therefore, cotton prices may rise further and may sustain the prevailing range of Rs 42,500 to Rs 44,500 a ton.
Farmers have increased sowing of cotton. During most of last year, cotton prices remained above the minimum support price. Prompted by last year's realization, farmers have increased their cotton sowing area by a staggering 45 per cent so far this season. There may be re-sowing of cotton seeds in the areas where rainfalls remained have deficient so far this season and crops damaged thereupon.
