INTERNATIONAL
Textile Raw Material Price 2015-11-08
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1078.19 |
USD/Ton |
0% |
11/8/2015 |
|
VSF |
2285.25 |
USD/Ton |
0% |
11/8/2015 |
|
ASF |
2039.28 |
USD/Ton |
0% |
11/8/2015 |
|
Polyester POY |
1038.89 |
USD/Ton |
0% |
11/8/2015 |
|
Nylon FDY |
2514.72 |
USD/Ton |
0% |
11/8/2015 |
|
40D Spandex |
5343.78 |
USD/Ton |
0% |
11/8/2015 |
|
Nylon DTY |
2750.48 |
USD/Ton |
0% |
11/8/2015 |
|
Viscose Long Filament |
5859.3 |
USD/Ton |
0% |
11/8/2015 |
|
Polyester DTY |
1280.94 |
USD/Ton |
0% |
11/8/2015 |
|
Nylon POY |
2341.83 |
USD/Ton |
0% |
11/8/2015 |
|
Acrylic Top 3D |
2216.1 |
USD/Ton |
0% |
11/8/2015 |
|
Polyester FDY |
1104.12 |
USD/Ton |
0% |
11/8/2015 |
|
30S Spun Rayon Yarn |
2844.78 |
USD/Ton |
0% |
11/8/2015 |
|
32S Polyester Yarn |
1744.59 |
USD/Ton |
0% |
11/8/2015 |
|
45S T/C Yarn |
2703.32 |
USD/Ton |
0% |
11/8/2015 |
|
45S Polyester Yarn |
1901.76 |
USD/Ton |
0% |
11/8/2015 |
|
T/C Yarn 65/35 32S |
2310.4 |
USD/Ton |
0% |
11/8/2015 |
|
40S Rayon Yarn |
3017.66 |
USD/Ton |
0% |
11/8/2015 |
|
T/R Yarn 65/35 32S |
2593.31 |
USD/Ton |
0% |
11/8/2015 |
|
10S Denim Fabric |
1.1 |
USD/Meter |
0% |
11/8/2015 |
|
32S Twill Fabric |
0.93 |
USD/Meter |
0% |
11/8/2015 |
|
40S Combed Poplin |
1.01 |
USD/Meter |
0% |
11/8/2015 |
|
30S Rayon Fabric |
0.75 |
USD/Meter |
0% |
11/8/2015 |
|
45S T/C Fabric |
0.75 |
USD/Meter |
0% |
11/8/2015 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.15717 USD dtd. 08/11/2015)
The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
Textiles Secretary S K Panda today said the sector will be the driving force behind Skill India and Make in India campaigns as it has the potential to create 45-50 per cent of the direct jobs in rural India. He was addressing the Indian Cotton Conference 2015 organised by Indian Cotton Association Limited (ICAL) and Northern India Textile Mills Association (NITMA) here. Suggesting for branding Indian cotton against the world labels, Textiles Commissioner Kavita Gupta emphasised on technical R&D needed to increase productivity. She said that average cotton productivity in India is 528 kg per hectare wherein the same stands 2,196 in Australia and 963 in the US. President NITMA H S Cheema illustrated the China scenario and suggested that the government should provide direct subsidy to the farmers. At the event, Suresh Kotak Chairman Kotak and Company was presented a lifetime achievement award for his contribution of more than 60 years to the cotton industry.
SOURCE: The Economic Times
Textile sector has a potential to create 45-50 per cent of direct jobs in the rural India and this sector would be the driving force behind Skill India and Make in India initiatives, said S. K. Panda, Secretary Textiles.He was speaking at the Indian Cotton Conference 2015 organised in Gurgaon, by Indian Cotton Association Limited (ICAL) and co-hosted by Northern India Textile Mills Association (NITMA) on the topic of ‘Dynamics of Make in India’. Key participants, who addressed a gathering of around 1,000 people with representatives from 18 countries, included Kavita Gupta, Textile Commissioner, Mahesh Sharda – President ICAL, HS Cheema – President NITMA, Manikram Ramaswami, MD, Loyal Textiles, and many international representatives from Switzerland, Vietnam, Singapore, Bangladesh and China.Stressing the need for branding Indian Cotton against the world labels, Ms. Kavita Gupta emphasised on technical research and development to increase productivity. She said that average cotton productivity in India is 528 kg/hectare wherein the same stands 2,196 kg/hectare in Australia and 963 kg/hectare in the U.S. Technical sessions and panel discussions were taken by Thomas Paul Reinhart (Switzerland), Wang Shensi (China), Uday Gill (Indonesia), Nguyen Hota (Vietnam), Mehdi Ali (Bangladesh), Sandeep Hota (Singapore) and PK Singhal (MCX Mumbai) among others.
SOURCE: The Hindu
Manipur’s Commerce and Industries Department will organise the Sangai Princess and Sangai Queen beauty contests during the India International Trade Fair in New Delhi and the Manipur Sangai Festival in Imphal, scheduled on November 17 and November 27 respectively, according to the Manipur Information Centre, New Delhi. State Commissioner of Commerce and Industries Vivek Kumar Dewangan held a meeting with North East student communities in New Delhi on Saturday to discuss the employment generation potential in the sector of handloom, handicraft and sericulture, promotion of local products and fabrics by organising beauty pageants, and participation of youths in entrepreneurial activities. The Industries Commissioner said his department, under the aegis of the Exhibition Committee of the Manipur Sangai Festival, entered into a Memorandum of Understanding with the Miss India organisers on October 31 to organise the Sangai Princess contest on the Manipur Day during the India International Trade Fair at Pragati Maidan, New Delhi, as a precursor to the Sangai Queen and Campus Princess for Miss India North East contest in Imphal on November 27 and 28 during the Sangai Festival. “The contestants for the Sangai Princess contest will be the residents of the National Capital Region having domiciles in the North Eastern States. The participant should be less than 25 years of age. Top finalists will get direct entry into the Sangai Queen contest in Imphal,” he said. The last date of submission of online applications is November 14.
Grooming and screening will take place at the India International Youth Centre, Chanakyapuri, on November 15-16, followed by a fashion show at 6 pm at Hamsadhwani Theatre at IITF, Pragati Maidan, on November 17. On the other hand, the Sangai Queen Contest will be held on November 27 during the Manipur Sangai Festival. The contestants should have domiciles in the NE States residing anywhere in India. Grooming and screening for the contest will be held from November 22 to 25. The Commissioner stated that Manipur has the highest density of handloom, handicraft and sericulture weavers in the country and the Manipur Government is promoting local products and local fabrics by showcasing their potential in product diversification as well as developing marketing linkages by using e-commerce platforms. He also proposed to organise a 10-day entrepreneurship workshop for BA and MA final year students of Manipur in the national capital in December this year to make them aware of the employment generation potential in the textile sector.
SOURCE: The Assam Tribune
Exports of the top five sectors including engineering and petroleum fell by about 31 per cent to $13.6 billion in September due to a slump in global demand. Exports from these sectors stood at $19.7 billion in the same month of last year. They had accounted for about 65 per cent of the total merchandise exports in 2014-15. Engineering exports growth turned negative (—) 22.81 per cent), petroleum (—60.35 per cent), textiles (—12 per cent) and gems and jewellery (—18.81 per cent) recorded negative growth during the September, according to the provisional data of the Commerce Ministry. Only the pharmaceuticals sector managed to register a growth of 9 per cent in September, it stated. During the last financial year, exports of these segments stood at $202.15 billion while the total exports were $310.5 billion.
Expressing concern over the continuous dip in exports, the Federation of Indian Export Organisations (FIEO) said the Government should immediately announce steps such as extending interest subsidy benefits to contain the dip in exports. Decline in exports has been instrumental in dragging down India’s overall merchandise exports. Contracting for the 10th month in a row, India’s merchandise exports dipped 24.33 per cent in September to $21.84 billion, due mainly to a steep fall in shipments of petroleum products, iron ore, and engineering goods, amid tepid global demand.
The Parliamentary Consultative Committee of the Ministry of Commerce and Industry held a meeting in Goa recently to review India’s exports performance. In the meeting, Commerce Minister Nirmala Sitharaman highlighted the concern that China has been making efforts to stall India’s exports through non-tariff barriers such as phytosanitary stipulations and standardisation issues. She has assured the committee that the Government was fully geared up to meet the challenges through exports on account of a slowdown in the global economy. The total exports in the past four financial years have been hovering at around $300 billion. The continuous decline in exports is expected to impact jobs and put pressure on the current account deficit.
SOURCE: The Hindu Business Line
Union Minister Nirmala Sitharaman today stressed on innovation in packaging technology as a measure to boost exports. Sitharaman, Minister of State for Commerce and Industry, described packaging as a blend of art, aesthetics, science and technology and underlined the role played by the industry in economic development. She was speaking at the Annual Convocation of the Indian Institute of Packaging (IIP) in the city. "Asia is the biggest market for packaging material with a 41 per cent share, as compared to 22 per cent of Europe and 21 per cent of USA and the field offers immense opportunities for the students graduating from the Indian Institute of Packaging," she said. Sitharaman urged the graduating students to form start-ups and innovate new packaging designs. "Today is the age of start-ups. Groups of students can form start-ups, and with some support from government, can become entrepreneurs," she said. The minister added that the Centre attaches immense importance to innovation and Prime Minister Narendra Modi has already announced government support to provide a launch-pad for start-ups. She further said that while packaging was essential for all products, the wastage of packaging material was a matter of grave environmental concern. She supported use of jute for packaging instead of man-made fibres wherever feasible. Sitharaman pointed out that her ministry would consider positively the proposal to make IIP an institute of national importance. She also said that the government was fully geared to meet the challenges through exports on account of slowdown in the global economy.
SOURCE: The Economic Times
Majority of India Inc feels optimistic about the state of the economy improving in the next two quarters at the industry and firm level, although the last six months have not witnessed much of a change at the ground level, says Assocham’s Biz Confidence survey. “In the coming six months there seems to be growing optimism in terms of the economic performance with 80 per cent respondents feeling that the state of the Indian economy would be better,” the June-September round of the survey observed. The percentages of optimist respondents in the June 2015 round were close to about 54.8 per cent. As to tentative recovery in last six months, the survey noted that while there were signs of economic recovery underway, the situation is still far from robust. The underlying economic activity remains weak on account of the sustained decline in exports, rainfall deficiency and weaker-than-expected momentum in the industrial production and investment activity, the survey pointed out. “However, riding on hopes of some decisive actions expected after the Bihar elections, the industry respondents remain optimistic about improvement in the sentiment, though at the present moment, broad demand and investment activity remains subdued,” Assocham Secretary General D S Rawat said. He added that another reason for the positive outlook stems from the macro-economic stability that will help bring down interest rates further, less volatility in the foreign exchange market and improvement in ease of doing business. However, when it comes to the period between June and September this year, majority of the industry (60 per cent) feels that the present economic situation is more or less same vis-a -vis the situation six months back.
Coming to specifics, the firms felt that though sales volume would pick up going forward, a commensurate change may not be visible on the profitability. That means, the power with the producer to improve margins on increasing sales would remain limited. As many as 68 per cent of the respondents expect that during October to December 2015, their sales volume will further increase, the survey added. In terms of cost of credit, majority of the respondents (44 per cent) feel that there is no change in the cost of credit during July to September, which is a bit surprising, considering that the RBI has reduced the policy rates. “The possible explanation to this could be that the benefit of the rate cuts is not being passed onto the industry appropriately. However, the industry feels that there could be a decline in the cost of credit going forward,” the survey said. Moreover, the industry wants quick action on infrastructure development, clearance of projects, stability in prices, effective policy reforms and better coordination between states and the Centre, it added.
SOURCE: The Financial Express
Dismissing apprehensions of Mauritius being used to route black money as "misconception", its Prime Minister Anerood Jugnauth has termed the issue as an aberration in the "very special" ties with India and hoped that revision of their tax treaty won't harm its interests. Stating that Prime Minister Narendra Modi has assured him India will not do anything that would harm Mauritius, Jugnauth said the two countries are "sensitive to each other's needs" and the negotiations on the Double Taxation Avoidance Treaty were taking place in this context. When asked whether there was any timeframe for resolving this long-pending revision of the tax pact, Jugnauth said he has not insisted on any particular time limit. "I leave it (to India). There is full freedom to your country, your Prime Minister... to look into it. I have confidence in the Prime Minister (Modi) and I trust him. I will wait for it and then we can comment," he said. The proposed tax treaty amendments, hanging in balance for many years, are aimed at addressing India's concerns over the island nation being allegedly used to route illicit funds into the country. "It is wrong and a misconception (that Mauritius is being used for round tripping). You know we are close to India," Jugnauth told PTI in an interview here.
Emphasising that Mauritius has a "very special" relationship with India, he reiterated that he is ready to go the extra mile to erase the misconception and assured that everything would be normal soon. On whether the tax treaty issues are just an aberration in the otherwise strong bilateral ties with India, he replied in the affirmative. "Apart from the DTAA (Double Taxation Avoidance Agreement) dispute, there is nothing else. In the international field as I said we always stand by India and whatever stand India takes we support India," said Jugnauth who was here recently to attend India-Africa Forum Summit. During his visit, Jugnauth also met Modi. "Modi had assured us even when he was in Mauritius. He said India will never do anything that will harm Mauritius," he said. Modi had visited Mauritius in March.
To a query about flow of genuine money being impacted by uncertainties over the tax treaty, he said, "What has happened lately has raised doubts in the minds of people. What will happen soon may get rid of all these doubts and everything will go back to normal." India has concerns that Mauritius, which is one of the top sources of FDI into the country, is being used for round- tripping of funds. Round-tripping is usually referred to routing of domestic investments through Mauritius to take advantage of the DTAA between the two countries. "Let me start with the fundamentals. India has time and again reaffirmed that it will do nothing to hurt the economic interest of Mauritius. "In addition, India and Mauritius share a unique relation and are sensitive to each other's needs. It is in this context that the negotiations on the Double Tax Avoidance Treaty are taking place," Jugnauth said. He further said that the two countries have made important progress and "we must ensure that the treaty remains workable". "First, we must see that the final product addresses India's concerns about any potential abuse of the Treaty and second, we must see to it that the treaty remains commercially meaningful for Mauritius," he added. When told that the tax issues have been going on for many years, Jugnauth said, "I won't say many many years. Many many years means a century. I will say this is going on for about 12 years, the discussions and all that. It is very difficult for me right now to make more comments".
A significant number of global firms, including those from the US and Europe, have traditionally been using the island nation to route their investments in India to benefit from an Indo-Mauritius DTAA in force since 1983. "When it comes to money and profit people are very money minded and people are always greedy and whatever they get is not enough. That is natural among people all over the world but we should not go by that. "We should look at the general feelings that exists between Mauritius and India. I am confident that this general feeling will prevail over the greed of some people," Jugnauth said. Asserting that Mauritius was a clean and trusted jurisdiction, Jugnauth said he would "walk the extra mile" to ensure that its reputation as clean and trusted jurisdiction is upheld at all costs. "We will put in all the necessary efforts and walk the extra mile to ensure that our reputation as clean, proven and trusted jurisdiction is upheld at all costs," he said.
SOURCE: The Economic Times
The international crude oil price of Indian Basket as computed/published today by Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas was US$ 45.07 per barrel (bbl) on 06.11.2015. This was lower than the price of US$ 45.66 per bbl on previous publishing day of 05.11.2015.
In rupee terms, the price of Indian Basket decreased to Rs 2965.20 per bbl on 06.11.2015 as compared to Rs 2998.62 per bbl on 05.11.2015. Rupee closed weaker at Rs 65.79 per US$ on 06.11.2015 as against Rs 65.68 per US$ on 05.11.2015. The table below gives details in this regard:
|
Particulars |
Unit |
Price on November 06, 2015 (Previous trading day i.e. 05.11.2015) |
Pricing Fortnight for 01.11.2015 (Oct 14 to Oct 28, 2015) |
|
Crude Oil (Indian Basket) |
($/bbl) |
45.07 (45.66) |
45.55 |
|
(Rs/bbl |
2965.20 (2998.62) |
2958.93 |
|
|
Exchange Rate |
(Rs/$) |
65.79 (65.68) |
64.96 |
SOURCE: PIB
The European Commission has asked for input from industry, health and policy experts on a potential plan to restrict hazardous substances in textile articles and clothing used by consumers. While all citizens and organizations are welcome to contribute to this consultation, the EC is particularly has sought the views from companies and organizations potentially concerned with the proposed restriction. The period of consultation began October 22 will run till January 22, 2016. Under the European Regulation on Registration, Authorization and Restriction of Chemicals (REACH), the EC may use a simplified procedure to restrict substances classified as carcinogenic, mutagenic or toxic for reproduction (CMR) in articles that could be used by consumers. Textile articles and clothing were selected as a first test-case because of the high likelihood of a prolonged – or multiple short-term – exposure of consumers to CMR substances being potentially present in those articles. The EC believes the present public consultation is needed to target relevant chemicals and articles and to consider the proportionality and enforceability of a possible restriction in this area. The main objectives of the public consultation is to collect information on the presence or likelihood of presence of identified CMR substances in relevant consumer articles and in so far as is possible also gather information on their concentration, function and on the availability of alternatives, the potential socio-economic impacts and the enforceability of the possible restriction.
SOURCE: Fibre2fashion
Textile firms of China are expanding overseas and Vietnam is becoming the favourite destination to set up new facilities for textile manufacturers of China. The reasons behind the shift are increase production and labour costs in the country. Another reason is that the apparels produced in the Southeast Asian country for the United States market will be tariff-free post the last month’s Trans-Pacific Partnership agreement. One of the textile manufacturing firms of China, Huafang Co. – a textile business in Shandong Province, is planning to set up its first overseas unit, which will be engaged in producing high-end fabrics factory, in Vietnam with a US $ 110 million investment. Around 150 million yuan will be invested into a research and development centre to explore new technologies covering the whole gamut of industry chain, including cotton, spinning, weaving and dyeing.
Recently, China-based textile manufacturer Keer also set up its facility in Lancaster County, USA and reported that the cost of land is reasonable there and even the workers are ready to get trained at nominal wages. Keer’s mill spins yarn from raw cotton to sell to textile makers across Asia. But it still spins much of its yarn in China, importing the raw cotton from America. Zhu Shanqing, Chairman of the company said that Keer has moved to the US because of land, incentives, workers and best suited business environment here, as in China, yarn manufacturing sector is losing money. Luen Thai International Group, which is Hong Kong’s largest clothing company, Sanshui Jialida TextileCo, based in Guangdong Province, and Vietnam’s Vinatex Co. are planning to establish a textile industrial park.
SOURCE: The CCF Group
Morocco sets an ambitious strategy seeking to reach MAD 6.5 billion of textile exportations by 2020, the Minister of Industry, Trade, Investment and Digital Economy Moula Hafid Elamaly highlighted Wednesday in Marrakesh.This goal comes as part of the Industrial Acceleration Plan and responds to the professionalism of the sector’s operators, the minister asserted during the inauguration of the 13th fair “Maroc in Mode et Maroc Sourcing” held by the Association Maroccaine des Industries du Textile et de l’Habillement (AMITH). The textile sector employs 30 percent of labor force and it is of a particular interest to the Ministry of Industry which supports it through the Industrial Development Fund (FDI), Moulay Hafid Elalamy highlighted. “Maroc in Mode et Maroc Sourcing,” held Nov. 4-6received 350 exhibitors representing different trends of the textile sector, according to the minister. Mohame Tazi, Genreal, Director of AMITH, underlined that this fair is of a significant importance for textile’s operators.Public authorities support the textile sector through a wide range of measures, which are likely to make Morocco a top textile actor in Africa and the Mediterranean, Mohamed Tazi said.The sector represents 25 to 30 percent of Morocco’s exportations and 15 percent of the added value in industry.
SOURCE: The Morocco World News
Taipei IN Style is scheduled to kick off at a cultural park in downtown Taipei on Nov. 12 to showcase the latest fashion from Taiwan and abroad during the four-day event, the event organizer has announced. The show, expected to run until Nov. 15 at Songshan Cultural and Creative Park, will feature products from the apparel, clothing, lifestyle and fashion industries created by Taiwanese designers and foreign talents. During a press event to promote the upcoming show held on Nov. 6, model Silvia Wang joined a catwalk during which she wore a total of 14 sets of clothing in succession designed by Taiwanese designers and their foreign counterparts. The four-day show will feature 197 booths from 150 fashion design companies around the globe. A total of 15 fashion shows will also be staged during the span of the show. Five seminars, to be joined by experts from France and the Netherlands, will also be held where Taiwanese experts and their foreign counterparts can exchange views on the latest fashion industry-related issues, according to the event organizer.
First launched in 2006, the TIS is sponsored by the Bureau of Foreign Trade under the Ministry of Economic Affairs and is organized by the Taiwan Textile Federation. With the goal of bonding the apparel and textile industry from upstream to downstream, the TIS has successfully paved the way for numerous Taiwanese and foreign designers, brands and companies to make it onto the international stage. Since 2014, the show has been staged twice a year, once in spring and another in fall.
SOURCE: The China Post
Even as many countries are inking more and more free trade agreements (FTAs), about 70 per cent companies are not fully utilising such pacts and are likely paying more than necessary in tariffs and duties, says an international survey. According to the respondents, the biggest challenges they face are manual processes and disparate systems and managing complex and changing regulatory requirements. The survey by Thomson Reuters and KPMG elicited responses from 446 corporate trade specialists in 11 countries. "Many corporates are struggling to meet complex compliance requirements using inefficient manual processes that can expose their companies to risk, consume time and resources, and don't leave time for activities that directly impact the bottomline," says the survey. The survey therefore notes that right technology can eliminate redundant work and empower trade teams to better compare and contrast tariff schedules between countries and take on a more strategic role in planning and operating a global supply vision for their organisations.
For 79 per cent respondents their biggest FTA roadblocks are complex rules of origin and difficulty gathering documentation and the top three drains on their time and resources are import documentation and licensing, customs broker management, and product import classification. Import classification, documentation and licensing are seen as the trade-related activities that create that greatest risk of penalties, other government sanctions, or increased operational. Trade specialists said their main challenges are interpreting rules across borders, changing requirements with local government agencies, and dealing with antiquated processes. Two-thirds of the respondents expect global trade to become more complicated over the next three to five years, while 85 per cent consider product classification is problematic. The survey results point to the changing landscape in global trade and that global supply chain is being redefined. "The life cycle of today's products continues to shrink, the delivery of goods to customers is being redesigned and technology has the ability to further enable innovation in areas of global trade unthinkable several years ago," says the survey.
SOURCE: The Economic Times
It was the 80 seconds China and Taiwan had waited almost 70 years for. Chinese President Xi Jinping and his Taiwanese counterpart, Ma Ying-jeou, smiled in dark suits -Xi wearing a Communist red tie, Ma, a Nationalist blue one - as they shook hands for more than a minute before hundreds of reporters in Singapore. The first face-to-face encounter since 1945 between leaders of China's civil war foes provided a new high-water mark in efforts to resolve one of the last century's biggest unsettled conflicts. The handshake and the 50-minute closed door meeting that followed cap a seven-year effort by Ma to strengthen economic ties across the 180-kilometer (110 mile) Taiwan Strait before he leaves office next year. It may bring Xi one step closer to realising China's dream of reunification. While investment, tourism and trade have flourished between the two sides under Ma, they remain politically distant, one democratic, the other ruled by the Communist Party. Saturday's handshake is the closest they've come to bridging that divide.
Creating Precedent
"It's a major breakthrough because the real impact of this meeting is that it creates a precedent," said Hoo Tiang Boon, an assistant professor at the S. Rajaratnam School of International Studies in Singapore. "The real substantial thing is that they met and had a handshake. It's the first time. And when you have a first time you always have a possibility of a second time."
SOURCE: The Business Standard
China's trade figures disappointed analyst expectations by a wide margin in October, reinforcing views that the world's second-largest economy will have to do more to stimulate domestic demand given softness in overseas markets. While Beijing has repeatedly cut interest rates, the latest data showing an eighth monthly drop in net trade indicates persistent weakness in demand at home and abroad. October exports fell 6.9 per cent from a year ago, down for a fourth month, while imports slipped 18.8 per cent, leaving the country with a record high trade surplus of $61.64 billion, the General Administration of Customs said on Sunday. Economists polled by Reuters had expected dollar-denominated exports to fall 3.0 per cent and imports to decline 16.0 per cent, an improvement over September's drop of 3.7 per cent and 20.4 per cent, respectively. But the weak export reading shows that China might be getting less of a boost than hoped from overseas holiday shopping, while falling commodity import volumes highlight stubborn weakness in demand from key sectors like real estate and construction that Beijing has been trying to revive. China's services sector, which has been one of the few bright spots in the economy, also lost some steam in October. "We see that the trade will unlikely turn around the momentum in the near term, and the RMB exchange rate will be under downward pressure especially as Fed signals to hike soon," Commerzbank China economist Zhou Hao said.
The decline in October exports was led by trade with developed economies, according to customs data. Shipments to the United States dipped 0.9 per cent on the year. Exports to the European Union dropped 2.9 per cent and exports to Japan fell 7.7 per cent. Combined exports and imports are down 8.5 per cent for the first 10 months of the year, well below the full-year official target for growth of 6 per cent. Last week, the Ministry of Commerce said the value of China's exports this year was likely to stay similar to 2014 levels, while imports could drop sharply in the fourth quarter. For 2016, the ministry expects to see steady growth in combined exports and imports as policy measures to support the trade sector take effect.
Policy measures
In order to lower social financial costs for firms, the central bank cut interest rates in late October for the sixth time in less than a year, and again reduced the amount of cash that banks must set aside as reserves. It has also guided the yuan into weaker territory against the dollar, but few believe Chinese exporters would benefit from anything short of a drastic devaluation. In fact, Beijing wants to move away from its dependence on low-end export manufacturing to drive growth and move up the value chain into high-tech products and services. Keeping the exchange rate relatively strong is seen by many economists as a way to push the pace of upgrade after decades of coddling. Louis Kuijs of Oxford Economics noted that the yuan remained far stronger than it was a year ago even after the depreciation."China's trade weighted exchange rate was still 8.5 per cent stronger than it was a year ago in September, and by itself this is hurting exporters, although weak global trade growth is a bigger problem."The country's economic growth dipped to 6.9 per cent in the third quarter, dropping below the 7 per cent mark for the first time since the global financial crisis.
SOURCE: The Business Standard
