The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 25 APRIL, 2017

NATIONAL

INTERNATIONAL

 

FY17 witnessed recovery in polyester chain delta: RIL

FY17 witnessed recovery in polyester chain deltas with firm stable demand, higher operating rates in China and lower inventory levels. I n FY17, domestic polyester markets witnessed marginal growth of 3% Y-o-Y.

Strong textile demand and new applications are driving polyester demand growth and it continues to replace natural fibre. PET domestic demand increased 6% Y-o-Y, informed Reliance Industries Limited, here today.

During 4Q FY17, RIL said, PX prices firmed up Q-o-Q amidst healthy buying from downstream. Three consecutive contract settlements during the quarter and improved crude oil prices provided strength to PX market. Delta increased to $385/MT during the quarter onaccount of surge in PX prices.

PTA markets witnessed disciplined operation supported by stable downstream demand and bullish sentiments in futures market at the beginning of the quarter. Prices gained Q-o-Q tracking firm upstream PX prices. PTA – PX delta remained stable at $99/MT in 4Q FY17.

Functional PTA units in China continued to operate above 85% during the quarter. MEG prices during the quarter surged 19% Q-o-Q backed by tight supplies, unplanned outages and low inventories in Chinese ports. MEG delta over naphtha increased 24% Q-o-Q to $541/ MT and is above 5 year average delta, RIL informed.

Polyester market fundamentals, RIL said, witnessed strong demand prior to Lunar New Year holidays in China.  polyester producers kept plant utilization rates high in order to maintain inventory for the peak season demand. Operating rates of polyester fibre and yarn plants in China were in the range of 82- 84% during the quarter. Polyester filament yarn prices improved by 9% and staple fibre prices gained 14% Q-o-Q respectively. PFY  elta continued to remain strong and was around 5 year average level. PSF market fundamentals remained stable amid tight supply & support from firm cotton prices. PSF delta surged to $210/MT, gain of 20% Q-o-Q and is  bove 5 year average levels.

Global PET markets continued to remain subdued owing to soft seasonal demand from beverage segment. However, the market witnessed pre buying from end users in order to build inventories  or peak spring/ summer season. PET prices improved 13% Q-o-Q owing to firm raw materials cost. Delta irmed  p Q-o-Q at $149/MT MEG production during quarter was lower due to scheduled plant shutdown at Dahej and  racker shutdown at Hazira. Fibre intermediate production during 4Q FY17 gained 5.8% Y-o-Y to 1.9 MMT while Polyester output was marginally lower at 0.6 MMT, RIL informed.

SOURCE: Tecoya Trend

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Rupee in sideways range

The rupee continued to consolidate for the second consecutive week. The currency has been trading between 64.26 and 64.74 over the last two weeks.

Within this range, the rupee fell to a low of 64.72 on Thursday. However, the currency managed to recover from this low and closed at 64.43 on Monday.

Interestingly, the rupee has not gained much in the past week despite a sharp 1.5 per cent fall in the dollar index, from around 100.5 to 98.95.

The British Pound surging over 2 per cent last Tuesday (April 18) after Prime Minister Theresa May called for an early election in June dragged the dollar index below the psychological 100 mark last week.

The pressure on the index increased further on Monday as the euro surged over a per cent following the outcome of the first round of French elections.

The dollar index is hovering around the 200-day moving average. Inability to bounce from current levels can take it lower to 98.65, which is the next key support. A break below this level will increase the likelihood of the index falling to 98.20 or even 98 thereafter. Such a fall in the dollar index may help limit the downside for the rupee. The level of 99.5 is a key resistance, which may cap the upside in the near term. The dollar index should surpass this hurdle for the downside pressure to ease.

Rupee outlook

Since the rupee retains its sideways range, there is no change in the outlook. The currency can continue to consolidate in a sideways range between 64.25 and 64.80 for some more time.

Within this range the possibility is high of the rupee strengthening to 64.30 or 64.25 in the coming days on the back of a weak dollar.

A breakout on either side of 64.25 or 64.80 will decide the next leg of the move. A break below 64.8 can take the rupee lower to 65.15 initially. Further fall below 65.15 may drag it lower to 66 levels once again.

On the other hand, if the rupee breaks the current range above 64.25, it can strengthen further to 64. The presence of the 200-week moving average at 64 might restrict the strengthening of the rupee in the short term.

Also, even if the rupee manages to break above 64, the upside could be capped at 63.85 where a strong trend-line resistance is present. So the strength in the rupee is expected to be limited to the 64-63.85 resistance zone.

As such, a subsequent reversal from this resistance region can take the rupee lower to 66 levels once again over the medium term.

SOURCE: The Business Line

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Rupee up 10 paise at 64.34 on increased dollar selling

The rupee strengthened by 10 paise to 64.34 against the US dollar in early trade on increased selling of the American currency by banks and exporters.

Forex dealers said that apart from sustained selling of the greenback by banks and exporters, a firm equity market supported the rupee sentiment at the Interbank Foreign Exchange market today.

However, the US dollar’s strength against other currencies overseas capped the rupee’s gain, they added.

Yesterday, the rupee had closed at a nearly two-week high of 64.44, up 17 paise against the US currency on heavy selling of the dollar by exporters.

SOURCE: The Business Line

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Arvind launches ready-to-wear apparel for men

The Arvind Store, part of the Arvind Group, on Monday, announced the launch of a new vertical, “Arvind”, offering ready-to-wear fashion apparel for men.

Announcing the launch, Kulin Lalbhai, Executive Director, Arvind Ltd, said these garments will be priced upwards of Rs. 1,299.

These will include blazers, bundis, kurtas, polos shirts, shorts, suits and bandhgalas. These will be available at all The Arvind Stores in Gujarat, Karnataka and flagship stores in other states, he added.

Arvind Ltd, one of India's largest integrated textile and apparel companies with a presence in branded garments, is one of the largest manufacturers and exporters of textiles products. It had a turnover of nearly US$ 1.3 billion in FY 2015-16.

Arvind has a portfolio of owned and licensed brands. Its own brands include Flying Machine, among others, while its licensed product brands include big global names, such as Tommy Hilfiger, Calvin Klein, Arrow, Gant, Nautica, IZOD, US Polo Assn, Hanes, Sephora, The Children's Place and Gap, and Aeropostale.

SOURCE: The Business Line

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India, Kazakhstan to increase cooperation in textiles

Indian and Kazakhstan are deliberating upon increasing cooperation in textiles sector and exploring export of raw cotton from South Kazakhstan to India for processing in Indian enterprises. The issues were discussed by the Kazakh-Indian Joint Working Group for cooperation in textiles during April 20-21, 2017 in the southern Kazakhstan city of Shymkent. 

It was the fourth meeting of the joint working group on textile. The talks were organised with the support of the Embassy of Kazakhstan in India and the Mayor’s office of the South Kazakhstan region, according to an agency report.

The two sides also exchanged views on the possibility of India’s participation in strengthening and development of light industry in the region. The Indian delegation also interacted with businessmen of the South Kazakhstan region, the report said.

The five-member Indian delegation was led by Subrata Gupta, joint secretary in the ministry of textiles and co-chair of the JWG. The 11-member Kazakh side was led by B Jamalov, deputy Akim (governor) of the South Kazakhstan region, and co-chairman of the JWG.

SOURCE: Fibre2Fashion

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Indonesia’s Textile Export Reaches $2 Bn in Early 2017

In the two months of early 2017, Indonesia’s textile and textile product (TTP) export have touched United States (US)$2 billion, or up by 3% compared to the same period in the previous year.

"The TTP industry, which is also an export-oriented labor-intensive sector, can be a social safety net because it employs a lot of workforce, up to now, estimated at three million workers," said Airlangga Hartarto, Minister of Industry on Monday (4/24).

The Ministry of Industry noted that TTP industry’s investment value in 2016 reached IDR7.54 trillion, with a significant foreign exchange gain from the export value of $11.87 billion, as well as employing as much as 17.03% of the total workforce in the manufacturing industry.

According to Airlangga, the national textile industry industry during the last three years has experienced a contraction in growth, one of which is driven by new investments and factory expansion in order to increase production capacity, one of which is Sritex.

"For that, we express our appreciation to Sritex for increasing its investment by IDR2.6 trillion to bolster production capacity in spinning mills and finishing, which will absorb the new workforce of 3,500 workers," he explained. This certainly has a positive impact on tax revenues for the state and at the same time can meet some of the needs of domestic raw materials that are still imported.

Iwan Setiawan Lukminto, President Director of Sritex, revealed that the expansion of the factory provided a rise in the company's production capacity.

"With the expansion, Sritex Group currently has 24 spinning mills, seven weaving plants, 5 finishing plants and 11 garments, with a total employee of over 50,000 people," he said. Therefore, the development and improvement of human capitals becomes the company's priority.

"Human capitals are the company's leading assets formed by structured training. In addition, we apply the corporate culture with an integrated and innovative so as to get a tough human resources, skilled, competent and character, "he explained.

In order for the national textile industry to improve its competitiveness, which required not only the capital and technology aspects, but also competent human capitals are absolutely necessary.

Therefore, the Ministry of Industry is making efforts to facilitate the improvement of human resources through a program of cooperation that links and match between industrial companies with vocational high schools (SMK).

The Ministry is able to invite 117 companies to sign a cooperation agreement with 389 vocational high schools in an effort to run industrial vocational education programs in the region of Central Java and Yogyakarta.

This program is a continuation of which has been launched in Mojokerto, on 28 February 2017

SOURCE: netralnews.com

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Incentives for Kenya's textile industry

Kenya has started offering tax incentives to clothing companies, a key part of its under-performing manufacturing sector, to create jobs and provide affordable new clothes for shoppers.

Executives in the textiles industry said the changes included allowing them to sell 20 percent of their annual production locally without sales taxes and without paying import duties on the materials and equipment used to produce the garments.

The advent of cheap, second-hand clothes imports from the US and Europe, locally known as mitumba, in the 1980s, put local apparel firms out of business and killed production of raw materials like cotton.

Mwangi Kiunjuri, planning minister, said it was dealing with some difficulties by implementing new policies to encourage firms to boost production and hire more people.

SOURCE: Reuters

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Textile, clothing exports rise 6pc to $1.064bn

ISLAMABAD: Textile and clothing exports rose 6.2 per cent year-on-year to $1.064 billion in March, mainly driven by value-added products such as garments, the Pakistan Bureau of Statistics said on Monday. The increase in export proceeds was also evident in rupee terms.

The data for the month shows that exports of value-added products grew during the month, both in terms of value and quantity.

Product-wise details show that exports of readymade garments rose 19.5pc while that of knitwear grew 5.4pc in March. Exports of bedwear edged up by 5.4pc while those of towels 15.8pc during the month.

In primary commodities, exports of cotton yarn witnessed a year-on-year increase of 5pc while those of cotton cloth and yarn (other than cotton’s) dropped 5.5pc and 26.9pc, respectively.

Exports of made-up articles, excluding towels, increased 16pc, and that of tents, canvas and tarpaulin grew 71.8pc. Proceeds from art, silk and synthetic textile increased by 2.7pc while those from raw cotton dropped 2.9pc year-on-year.

One reason why textile exports are in decline is that the preferential access to the European Union under the GSP+ scheme hasn’t helped boost proceeds due to slump in demand.

In the nine months through March, the value of exported textile and clothing products fell 0.89pc year-on-year to $9.278bn. Overall export proceeds in July-March were down 3pc to $15.118bn.

Last year, the government announced a textile policy involving 4pc rebate on the exports of readymade garments on a 10pc incremental increase over the preceding year, 2pc on home textiles and 1pc on fabric. However, no support was announced on raw material or yarn exports.

Under this policy, the government paid out Rs2.5bn to exporters in the preceding fiscal year. This shows the policy worked to some extent and promoted exports of value-added textile products.

From Jan 15 onwards, the government has not only increased the rebate to 7pc for readymade garments, but it has also allowed cash support of 4pc on yarn and grey cloth under a Rs180bn package announced by the prime minister.

One reason for the textile package — announced for January 2017 to June 2018 — was the need to counter the rising cost of production.

Source: DAWN

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