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MARKET WATCH 09 AUGUST, 2017

NATIONAL

INTERNATIONAL

Importers' unhedged currency positions rise with strong rupee

The appreciating rupee may reflect the strength of India's economy, but an unintended consequence is the complacency setting in among importers and borrowers. The level of unhedged foreign currency positions has risen substantially and poses a substantial risk if global conditions turn adverse.  With the local currency strengthening, Indian companies have stayed away from covering their foreign exchange liabilities because it would reduce their repayment costs. When the rupee appreciates against the dollar, fewer units of the local currency are needed to pay back each dollar.Unhedged or uncovered positions may have increased by as much as 60 per cent, according to industry estimates.  “With a rise in the rupee's value, many importers are now comfortable to keep their payables open,“ said Abhishek Goenka, founder of IFA Global, a Mumbai-based forex consulting firm“The rupee's outlook has sig nificantly changed over the past six months as the local unit is now expected to rise against the dollar amid the country's economic optimism.“  Unhedged bets have increased at least by 50-60 per cent as import ers have drawn com fort from the ru pee's latest rally against the green back, Goenka said.  Unhedged posi tions help compa nies save on costs, adding to their bot tom line when the econ omy is on the cusp of growth, bur nished by the gov ernment's reform policies.  The rupee has gained more than 6 per cent this calendar year. About a year ago, the hedging ratio, which the Reserve Bank of India insists upon in a volatile currency market, was much better.Companies now pay about 4.3 per cent as hedging cost for a one-year maturity.  “With external borrowingsloans, im porters as well as companies that were worried over a falling rupee a year ago are now clearly in the driver's seat,“ said KN Dey, managing partner at United Financial Consultants, a Mumbai-based forex advisory firm.

Source: Economic Times

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Exporters brace for further rise in Rs.

Exporters are bracing for tough times in the shorter term, with the rupee continuing to appreciate against the dollar, making India’s exports less competitive and reducing exporters’ margins. “The worst is yet to come. With the currency appreciating at a fast clip, the competitiveness of Indian goods will go down,” said Ajay Sahai, director-general of the Federation of Indian Export Organisations (FIEO). Major exporting sectors such as engineering goods, apparel and automobiles were expected to come under pressure, he added. The rupee has risen by 6.8 per cent against the dollar in 2017 to close at 63.64 on Tuesday. A stronger currency hurts exporters and makes imports, foreign travel and education cheaper. Economists have predicted a further strengthening of the rupee. “India is a net importer and a stronger rupee will help in reducing the trade deficit and keep inflation in check. The focus should be on specific sectoral intervention,” said Devendra Pant, chief economist at India Ratings & Research. The FIEO estimates the rupee will continue to rise in value over the next six months because of large foreign portfolio investment inflows and will finally settle at ~62-60 to a dollar. This is due to the dim investment outlook for most developing nations, while global capital pours into India at an unprecedented rate. Foreign portfolio investors’ ownership of Indian equities reached a record during the quarter ended June as overseas funds continued to invest aggressively. Foreign portfolio investors own 27.5 per cent of the top 75 companies listed on Indian bourses, according to Morgan Stanley. Since the currencies of competing nations like Bangladesh, the Philippines and Vietnam had depreciated, India’s exports would continue to lose competitiveness in the global market, exporters warned. The forward premium on many commodities has decreased in the past year. However, with merchandise exports from the India Scheme covering nearly 8,000 product categories, further tariff support by the government was unlikely, an official said. The introduction of the goods and services tax (GST) and the ensuing confusion over the operation of export-promotion schemes are worsening the prospects for exporters. “Several government schemes for exporters have been turned upside down,” said T S Bhasin, chairman of the Engineering Exports Promotion Council. These include duty-free imports of inputs under the “advance authorisation” scheme. Supply of goods to export-oriented units from the domestic tariff area are not considered “deemed exports” under the GST, Bhasin added.  An analysis of the 10 largest export-oriented sectors from CRISIL’s rated portfolio showed in late July that leather, textiles, meat, seafood and basmati rice were the most vulnerable to a stronger rupee. “A majority of exporters have weathered the storm. Any significant rise in the rupee will affect the credit profiles of exporters in vulnerable sectors,” said Anuj Sethi, senior director, CRISIL. Exporters rated below ‘BBB-’ (moderate safety) are vulnerable to challenges on both the demand and supply sides.

Source: Business Standard

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Textile industry cheers lowering of GST rate on job work

The Confederation of Indian Textile Industry (CITI) today welcomed the GST Council's move to slash the rate on job work like weaving, cutting, knitting and embroidery to 5 per cent from 18 per cent decided earlier. The GST Council, headed by Finance Minister Arun Jaitley comprising representatives from all states, last week decided to tax all job works in the textile sector at 5 per cent. This 5 per cent rate will be applicable for job works in apparel, shawls and carpets. In a statement, CITI Vice Chairman Sanjay K Jain described it as a big breather to small job work manufacturers in all segments of textile value chain which will allow the free flow of business across the value chain. "A common rate across the chain would also avoid confusion. All textile job works being manufacturing activities were exempted from service tax in pre-GST regime. But job workers could not avail input tax credit that had been increasing the cost of the products and affecting the export competitiveness and also the domestic consumers," Jain said. He said the 5 per cent GST rate on job works would enable the industry to claim full input credit and also avoid any inverted duty and strengthen the global competitiveness of the textile sector apart from benefiting the domestic consumers. However, Jain said the reduction of GST rate for manmade fibre and synthetics from 18 to 12 per cent being postponed is disappointing. He claimed that imports are now cheaper than domestic products as the countervailing duty (CVD) and special additional duty (SAD) on imports have become Integrated GST. "Earlier the additional duties, namely, CVD & SAD were a protection against imports. Hence, industry would need some safeguard measures to ensure the Make in India initiative does not wash away in the avalanche of imports (which have post GST become 12 to 16 per cent cheaper). "We have apprehensions that Indian market would get flooded with imports from China, Bangladesh and Sri Lanka, which would end up in huge job losses," Jain said. He urged to the government and GST Council to accommodate the textile industry's demand of 12 per cent GST rate on MMF and synthetic yarn or refund of duty under inverted duty incidence at fabric stage as prescribed in GST Act.

Source:  PTI

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CITI hails GST rate reduction for textile job work

 (CITI) has welcomed the reduction of service tax rates for job work services in respect of textiles and textile products (including MMF yarn, garments, made-ups, etc falling in Chapters 50 to 63) from 18 per cent to 5 per cent. The GST Council decided to reduce GST rate at its 20th meeting this month. Sanjay K Jain, vice chairman, CITI thanked finance minister Arun Jaitley, GST Council and textiles minister Smriti Irani for considering the representation and bringing all the textile job works under the service list of 5 per cent GST. He explained that the step will come as big breather to small job work manufacturers in all segments of textile value chain and will allow the free flow of business across the value chain. A common rate across the chain would also avoid confusion. Five 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, according to Jain. He said that such a proactive response from government would enable the textile industry to become a true global player and encourage Make in India. He also explained that reduction in tractor spares would help the cotton farmers as tractor spare parts would be now cheaper. He further added that the much-expected reduction of GST rate for MMF and synthetics from 18 to 12 per cent being postponed is disappointing as the production for the forthcoming quarters was eagerly waiting for this. “We have apprehensions that Indian market would get flooded with imports from China, Bangladesh & Sri Lanka, which would end up in huge job losses. Imports are cheaper than domestic products as the CVD & SAD on imports have become IGST. Earlier the additional duties, namely, CVD & SAD were a protection against imports. Hence, industry would need some safeguard measures to ensure the Make in India initiative doesn’t wash away in the avalanche of imports (which have post GST become 12 to 16 per cent cheaper),” he said in a CITI press release. He urged the government and GST Council to accommodate industries demand of 12 per cent GST rate on MMF and synthetic yarn or refund of duty under inverted duty incidence at fabric stage as prescribed in GST Act, as it would facilitate the industry’s growth.

Source: Fibre2Fashion

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Industry welcomes cut in GST rates on textile job work

The textile industry has welcomed the Government’s move to cut the Goods and Services Tax (GST) on job work or the third-party services, but said some more leniency in cost is needed. In its meeting last week, the GST Council, chaired by Finance Minister Arun Jaitley consisting of representatives from all the states, had taken the decision to bring down the tax on all the job works such as weaving, knitting, cutting, and embroidery in the textile sector at from 18% to 5%. The 5% rate will be applied on job work in apparel, carpets and shawls. “We welcome this move of the government but it would be better if it is zero percent,” P M Shah, President, Southern Gujarat Chamber of Commerce and Industry (SGCCI) told The Dollar Business.  “The thing is that the Government has decreased the GST on all the job works of the textile sector from 18% earlier to 5% but we still have to pay it and it is a cost burden for us, he said. Input tax credit which the industry gets is the best option and is beneficial for us, Shah said, while adding, “We’re demanding full and timely refunds of input tax credit.” He further said that SGCCI has submitted a representation to the Commerce Ministry on behalf of the textile industry, demanding imposition of import duty on the Chinese fabrics to safeguard the SME segment, which has been under lot of pressure due to heavily under-invoiced fabric imports from China. In a statement, the Confederation of Indian Textile Industry (CITI) Vice Chairman Sanjay K Jain said, “A common rate across the chain would also avoid confusion. All textile job works being manufacturing activities were exempted from service tax in pre-GST regime. But job workers could not avail input tax credit that had been increasing the cost of the products and affecting the export competitiveness and also the domestic consumers,” he added.

Source: The Dollar Business

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Texprocil welcomes cut in GST for job work in textile sector

The Cotton Textiles Export Promotion Council (Texprocil) today welcomed the government’s decision to reduce GST rate for job work in the textile sector. The Goods and Services Tax (GST) Council, in its meeting last week, decided to cut the tax rate for job work for the entire value chain of textiles sector to 5 per cent. Earlier, the GST for job works related to textile yarns, other than manmade fibres and textile fabrics, was 5 per cent, while for manmade fibres yarns and made ups/ garments, it was 18 per cent. "The reduction in the GST rate for job work in the made ups and garment sectors is welcome and a positive measure which will bring down the costs for the textiles sector across the value chain," Texprocil Chairman Ujwal Lahoti said. "A majority of the manufacturing activities in the textiles sector take place through job work and the reduction in the GST rate has come as a huge relief for the sector," he said. With regard to exports, Lahoti said, "Merchant exporters cannot benefit from the facility of exports under bond/ Letter of Undertaking (LUT). There is no enabling document prescribed so far by the government under which goods can be cleared by a manufacturer without charging IGST meant for exports by a merchant exporter against bond/LUT." The chairman urged the government to introduce similar facility at the earliest so that the merchant exporters exporting under Bond/LUT can get IGST-free goods from the manufacturers. The Foreign Trade Policy allows fulfilment of export obligations under various schemes though "third party exports". Such a provision of getting exports goods without payment of IGST from the textiles manufacturers will lead to ease of doing business and also seamless flow of credits, according to Lahoti. Further, to operate under the facility of Bond/ LUT, a bank guarantee is required to be furnished by the exporters. Lahoti urged the government to exempt those exporters holding a valid membership with an Export Promotion Council (EPC) from furnishing bank guarantees as it increases costs for the exporters. In the Central Excise regime, merchant exporters who were members of an EPC were exempted from furnishing bank guarantees while executing B-1 Bond, he said.

Source: India today

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Weavers demand GST exemption for handlooms, subsidised yarn supply

Over 30,000 looms were in operation across Prakasam district a few years ago providing employment to over 1.20 lakh handloom weavers with a majority of the looms concentrated in and around Chirala town which gets its name for Chira (sari). Now the number of looms has come down to about 10,000 with a majority of weavers quitting their traditional profession unable to compete with power looms, which produced cloth at a much cheaper rate. Adding to their woes is the new Goods and Services Tax (GST) on raw material and finished handloom products. “Who will buy the costly clothes produced by us now,” ask a group of weavers who took part in the National Handlooms Day fete here on Monday. They urged Union Finance Minister Arun Jaitley to reconsider the GST on yarn, dyes and cloth as the same would prove to be a death blow to the crisis-ridden handloom sector as they are not in a position to pass on the GST to customers in the wake of declining patronage for hand-woven clothes. “With weaving proving to be unremunerative, more and more weavers are forced to eke out a living by working as masons and waiters in hotels in cities and towns,” laments Macharla Gourishankar of the Sitaramaraju Handloom Weavers Cooperative Society from Janarpeta.

Cluster development

Weavers had not at all benefited by the Centre's Rs. 70-crore handloom clusters development scheme as even 60-year-old weavers were enrolled defeating the purpose of imparting skills to members of the GenX to carry forward the glorious tradition, said another weaver Katuri Venkateswarlu from Epurupalem. “What we need is subsidised yarn, modern compressed looms, motorised jacquards, modern design studio and worksheds to survive in the era of globalisation,” added another weaver K. Lakshma Rao from Desaipeta. “We don't have sufficient work for our deft hands now,” lamented yet another weaver K. Vijaykumar from Chirala while pressing for revival of the service centres in operation during the NTR regime which supplied raw material and took care of marketing as well. The governments should take the responsibility for supply of subsidised yarn and dyes and market handloom products ensuring decent returns for weavers who toil along with other family members for 12 to 16 hours each day, explained weavers’ leader Jwala Narasimham.

Source: The Hindu

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Why Surat textile industry is unhappy with GST rate

The Centre has revised the goods and services tax (GST) on textile from 18% to 5% in last meeting on Saturday. However, textile industry in Surat seems unhappy with the decision and considering to resume the protest against GST. The GST Council had on Saturday decided on a cut in rates on job work, from 18% to 5%. However, this has brought cheer to only the garment industry, not to the synthetic and fabric-based textile industry that largely located in Surat. Tarachand Kasat, president of GST Sangharsh Samiti of Surat, said, “Surat is a hub of synthetic and fabric-based textile. The recent decision on GST rates will not impact us in a large scale. Moreover, we had demanded removal of 5% tax and easy filing of return. The samiti will meet and interact with the traders on Tuesday or Wednesday to decide strategy to recall the protest.” The traders in Surat had called off their two-week-long strike on July 18 against the imposition of 5% GST on textiles following the Centre’s assurance to look into their demand. Thousands of textile merchants in Surat had shut their shops to protest the new tax structure. The trade has also demanded 18-month time for implementation of GST. However, the council has refused the demand. Surat’s textile industry employs about 1.5 million people, spread in spinning, weaving, dyeing and processing, trading and garmenting, through nearly 20,000 manufacturers, including power looms, 75,000 traders and 150 wholesale markets. Of this, garmenting forms a small portion. The bulk is in spinning, weaving, dyeing and processing, as well as trading of fabrics, sarees and dress materials.

Source: Financial Express

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Surat's textile transporters won’t accept delivery of uninsured goods

SURAT: Following an increase in the incidents of thieves targeting transport trucks on the National and State highways in Maharashtra and Gujarat, the Surat Textile Goods Transporters' Assocition (STGTA) has asked the textile traders for insuring their textile goods, before sending the parcels to other states.  In a meeting held on Monday, the transporters have unanimously decided not to accept the uninsured textile goods. Transporters stated that most of the traders are not taking insurance on their goods and thus the transporters have to bear the losses at the time of theft and loot of the parcels on highways. Transporters stated that around 12 incidents of loot have been reported in the last 10 months. Majority of the incidents have been reported from the Bardoli-Dhulia and Songadh-Vyara state highways. The thieves target the moving transport truck and escape with the parcels of saris and dress material being supplied to Maharashtra and other states. Goods worth over Rs 6 crore has been looted in the last 10 months and that the incidents are increasing.  The country's largest man-made fabric (MMF) wholesale market has around 165 textile markets housing more than 65,000 textile shops. The daily turnover of the saris and dress material is pegged at Rs 115 crore. There are around 1,500 transport trucks that transport the textile goods to various destinations across the country. President of STGTA, Yuvraj Deshle said, "Only 5 per cent of the traders in the markets take insurance on the goods in transit, while majority of the traders do not take insurance. When the loot incidents occur, the transporters are being held responsible and that the traders demand re-payment."  Deshle added, "The transporters are at risk as they can't bear the losses. We have asked the traders to either insure their goods or they will not accept the delivery."

Source: Times of India

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Transhipment facility at Tuticorin port set to ease raw cotton sourcing pressure

COIMBATORE: A special facility for handling imported raw cotton at Dakshin Bharat Gateway Container Terminal at VO Chidambaranar Port in Tuticorin has come as a welcome relief for the spinning industry in the South. The industry will now be able to use this transhipment facility to source its raw material requirement without too much of a lead time, said industry sources.

Price stability

Hailing the Ministry of Shipping’s initiative, the Chairman of the Southern India Mills Association M Senthilkumar said the provision of the facility would bring stability in cotton prices as imported fibre would be available on demand, which in turn would help mills prevent loss on account of price volatility and currency fluctuation. MSME units will now be able to have direct and daily access to the raw material, he said and recalled the difficulty the industry faced in procurement of cotton. The state’s annual requirement of cotton is around 120 lakh bales, but the production is just about 5 lakh bales a year. The mills here, therefore, depend on upcountry and imported cotton for processing into yarn. Cotton prices tended to move in a volatile band following the removal of the fibre from the Essential Commodities Act in 2007. The past two years proved tough as the demand for imported cotton soared and with it, the prices moved north as mills faced some quality issues in domestic cotton. Import of the fibre was also not easy. Only the large mills with financial strength and volume requirements managed. Further longer lead time and currency fluctuations impacted the unit’s operating profit.

Coastal shipping

The association tried its best to facilitate coastal movement of cotton to reduce transport cost as also impress upon the need for creation of a Free Trade Zone (FTZ) facility at Tuticorin. A direction was issued for coastal movement of cotton between Gujarat and Tamil Nadu. “We envisaged a volume of 25 lakh bales, but could manage only 10 lakh bales as quality issues arose in the last two years,” Senthilkumar said. A VOC Port Trust release said that the facility would accommodate around 500 TEUs of 40-feet container. In the second phase, a Free Trade Warehousing Zone (FTWZ) will be established with world-class infrastructure for warehosuing of raw cotton, transportation and handling facilities, commercial office space, water, power, communication and connectivity with one stop clearance of import and export formality to support the integrated zones as “international trading hubs.” it said.

Source: Business Line

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Global Crude oil price of Indian Basket was US$ 51.60 per bbl on 08.08.2017

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$ 51.60 per barrel (bbl) on 08.08.2017. This was higher than the price of US$ 51.04 per bbl on previous publishing day of 07.08.2017. In rupee terms, the price of Indian Basket increased to Rs. 3288.77 per bbl on 08.08.2017 as compared to Rs. 3253.35 per bbl on 07.08.2017. Rupee closed unchanged at Rs. 63.74 per US$ on 08.08.2017 as compared to 07.08.2017. The table below gives details in this regard:

 

Particulars

Unit

Price on August 08, 2017 Previous trading day i.e. (07.08.2017)

Crude Oil (Indian Basket)

($/bbl)

51.60               (51.04)

(Rs/bbl)

3288.77           (3253.35)

Exchange Rate

(Rs/$)

63.74               (63.74)

 

 Source : PIB

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Profitability remains a challenge for branded apparel companies

Despite good revenue growth, profitability has remained subdued for apparel companies such as Arvind Ltd, Aditya Birla Fashion and Retail, and Raymond. Graphic: Naveen Kumar Saini/Mint Investors’ wait to benefit from good revenue growth at leading apparel companies just got longer. Arvind Ltd, Aditya Birla Fashion and Retail Ltd (AB Fashion), and Raymond Ltd reported double digit growth in revenues in the June quarter (Q1). But that did precious little for earnings. Earnings per share at Arvind fell 19%. AB Fashion and Raymond reported losses. In fact, profitability at Arvind has been steadily falling over the last one year. In the June quarter it dropped about three percentage points, hit by high raw material prices and a strong rupee. AB Fashion, which reported an improvement in profitability in the January-March quarter, saw its margins soften again in Q1. Raymond’s margins improved, but that is largely driven by the engineering or the non-garments businesses. Some analysts have pared earnings estimates for these companies for the current fiscal. “In view of lower margins in the textile business, we have reduced our earnings estimates for FY2018 by 7% (already had a 7% reduction in FY2018 estimates prior to announcement of Q1FY2018 results) and have broadly maintained our FY2019 earnings estimates,” Sharekhan Ltd said in a note on Arvind. ICICI Securities Ltd has reduced its earnings estimates for AB Fashion citing continuing losses in the fast fashion or new business. The earnings cuts, however, are not altering analysts’ views on the stocks. Given that the established brands businesses continue to do well, most expect these companies to report good revenue growth. And as the retail channel transitions to the goods and services tax (GST) and new businesses break even, analysts forecast these companies’ earnings to get a leg-up from the next fiscal year. Nevertheless, the ongoing trends and headwinds pose challenges to that assumption. The established brands businesses, despite delivering good growth, are yet to demonstrate a sustainable improvement in profitability. Profitability at Arvind’s so called “power brands” for instance softened from 9.1% a year ago to 8.9% in Q1. Similarly margins at AB Fashion’s lifestyle brands business are little changed. Further, of late the garments sector is seeing an increasing number of “end-of-season” sales, which could have an impact on realizations. Stagnant profitability would not have been much of a bother as the incremental revenue growth will anyway add to operating profits in absolute terms. But that doesn’t offer much solace. The case in point is AB Fashion. Operating profits at the established “lifestyle brands” business rose 17% last quarter. But as losses at the new investments expanded, the earnings at the brands (Madura) business slumped by one-fifth. Worryingly the losses at the new investments showed no signs of easing. While this makes breaking even at the new businesses crucial for revival in profitability, much also depends on the consumer demand and input costs trajectory.

Source: Livemint

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1190 acres acquired for mega textile park in Warangal

A mega textile park will be coming up in Warangal City soon with an estimated outlay of ₹1,150 crore and it is expected to provide direct employment to 13,000 people, Deputy Chief Minister Kadiam Srihari said. The textile park would attract investments of over ₹ 11,000 crore and it would have ginning, spinning, weaving, dyeing and other units all at one place. Once completed the industrial cluster would bring back the weavers and textile workers who migrated to distant places like Sholapur, Gujarat, Bhiwandi and others, the Deputy Chief Minister said.

Saplings planted

Taking part in Haritha Haaram programme at the Textile Park site, Mr. Srihari said it was decided to plant 20,000 saplings and already 10,000 were planted on the site. The state government has acquired 1,190 acres of land for the proposed textile park with consent of farmers. Later, he inaugurated the additional classrooms at Government Junior College at Sangem mandal headquarters. MLA C. Dharma Reddy, district collector Mr. P. J. Patil and RDO Mahendar were present.

Source: The Hindu

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Global Textile Raw Material Price 2017-08-08

Item

Price

Unit

Fluctuation

Date

PSF

1190.24

USD/Ton

0%

8/8/2017

VSF

2355.19

USD/Ton

-0.13%

8/8/2017

ASF

2201.94

USD/Ton

0%

8/8/2017

Polyester POY

1191.73

USD/Ton

-0.19%

8/8/2017

Nylon FDY

3139.26

USD/Ton

0%

8/8/2017

40D Spandex

5058.52

USD/Ton

0%

8/8/2017

Polyester DTY

2380.48

USD/Ton

0%

8/8/2017

Nylon POY

1502.68

USD/Ton

0%

8/8/2017

Acrylic Top 3D

3243.4

USD/Ton

0.46%

8/8/2017

Polyester FDY

5653.64

USD/Ton

-0.52%

8/8/2017

Nylon DTY

1420.85

USD/Ton

0%

8/8/2017

Viscose Long Filament

2856.58

USD/Ton

0%

8/8/2017

30S Spun Rayon Yarn

2975.6

USD/Ton

0%

8/8/2017

32S Polyester Yarn

1782.38

USD/Ton

-0.58%

8/8/2017

45S T/C Yarn

2774.75

USD/Ton

0%

8/8/2017

40S Rayon Yarn

1919.26

USD/Ton

0%

8/8/2017

T/R Yarn 65/35 32S

2306.09

USD/Ton

0%

8/8/2017

45S Polyester Yarn

3139.26

USD/Ton

0%

8/8/2017

T/C Yarn 65/35 32S

2291.21

USD/Ton

0%

8/8/2017

10S Denim Fabric

1.38217

USD/Meter

0%

8/8/2017

32S Twill Fabric

0.84953

USD/Meter

0%

8/8/2017

40S Combed Poplin

1.18726

USD/Meter

-0.13%

8/8/2017

30S Rayon Fabric

0.671

USD/Meter

0%

8/8/2017

45S T/C Fabric

0.69331

USD/Meter

0%

8/8/2017

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.14878 USD dtd. 8/8/2017). The prices given above are as quoted from Global Textiles.com.  SRTEPC is not responsible for the correctness of the same.

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Jeanologia guiding Indonesian textile industry

The Spanish company specialising in garment finishing, Jeanologia, is guiding the Indonesian textile industry in its transformation to efficiency and sustainability by establishing its presence as an expert technology partner for production centres looking for products that are equally innovative and ecological. The company has clients in five continents. The Spanish company at a press meet at Bandung presented their revolutionary combination of laser, ozone and e-flow technology that replace traditional processes producing large amounts of contaminants and dangerous for workers and the environment. With the introduction of these global solutions based on clean technologies along with Jeanologia’s know-how, production centres are able to increase productivity, efficiency and reduce production costs. Currently, Indonesia generates two per cent of global jeans production and wants to be equipped with the innovation and technology that attracts big fashion brands, allowing competitive advantage over other Asian countries. Jeanologia specialises in identifying needs, finding solutions and supporting brands, manufacturers and laundries during the transformation process. The sustainable use of water is one of the company’s priorities and in Indonesia they have presented their revolutionary One Glass, One Garment. For the finishing of a pair of jeans, traditionally 70 liters of water is needed, with this new technology it is dramatically reduced to only one glass of water. According to Fernando Pérez-Narbón, area manager at Jeanologia, it is possible to have a sustainable production thanks to innovation and technology. He highlights “in the automotive industry they have managed to reduce fuel consumption and emissions of carbon dioxide due to innovation and the same is happening in the textile industry: with new technology, it is becoming possible to reducing water consumption and pollution”. He adds “we are living a revolution and giving added value to everyone involved: laundries, brands and final consumers”. One of the objectives of the press conference was to promote the Green Kosambi Mall, the shopping mall is dedicated to the textile industry and aims to become the hub for all companies of the industry. Local textile companies can come here to learn about and experience Jeanologia’s technology as they already have one of their lasers installed. The Green Kosambi Mall is located in the city of Bandung, the historical heart of the country’s textiles known for its denim. The Spanish firm is consolidating its presence in Indonesia where it has increased its post-sales services, providing the country with a technical team and consulting and training services from their brainbox experts. This allows them to accompany production centres throughout the process of transformation to sustainability and efficiency. Since 1993 their mission has been to improve the industry of garment finishing through their technology and know-how. Their laser, G2 ozone and e-flow system have revolutionised the textile industry. They offer endless design possibilities and garment finishes, while saving water, energy and chemicals, eliminating waste and toxic emissions. Currently the Spanish company has clients in five continents. The export of its machines and services represents 90 per cent of its total billing, reaching 60 countries including: Indonesia, the USA, Mexico, Columbia, Brazil, Germany, Italy, Portugal, India, China, Russia, Japan, Morocco, Bangladesh, Pakistan, Turkey, Tunisia and Vietnam.

Source: Fibre2Fashion

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Pakistan : FBR withdraws zero-rating of textile unit

KARACHI: The Federal Board of Revenue (FBR) has withdrawn zero-rated sales tax on the consumption of gas on the misuse of facility by a textile unit, sources said on Tuesday. The FBR had withdrawn the facility that was allowed to Lakhany Textile International located at SITE Industrial Area Karachi, they added. The FBR directed the chief commissioner of Corporate Regional Tax Office, Karachi to coordinate with the Sui Southern Gas Company to stop the facility and start charging normal rate of sales tax on supply of natural gas, the sources said. The FBR also directed the chief commissioner to initiate legal proceedings against the textile unit and report the board regarding recovery action against the misuse of the facility. The sources said the unit had been registered at the income tax since February 6, 2001 and the entity was registered with the sales tax since April 13, 2000. The unit has been registered as manufacturer, spinning, weaving and finishing of textile. The FBR allowed sales tax facility on gas and electricity consumption to the textile entities in order to reduce the cost of manufacturing and make the exports competitive in the international market, they said. The revenue body recently launched a drive against the misuse of the facility and withdrawn zero-ratings allowed to many textile units. The FBR is conducting physical examination afresh of all textile units, which are enjoying the facility. The tax offices observed that many textile units were only available on papers and the energy was being used for commercial purposes.

Source: The News International

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Pakistan : Wide technology divide stands in the way of textile revival

LAHORE: Muhammad Pervaiz Malik, Minister for Commerce and Textile, who himself is a veteran industrialist from the crisis-hit basic textile sector, is very well alive to the fact that it will be a daunting task for his ministry to manage massive subsidies needed to narrow the yawning technological divide that continues to widen further, owing to a total absence of upgrade. Ali Pervaiz, the son of the commerce minister, is central vice chairman of All Pakistan Textile Mills Association (APTMA). The APTMA claims that 40 percent of its capacities are closed due to high cost of doing business. There was 30 percent cut in power rates, 40 percent reduction in energy rates plus export rebates to recapture the basic textile market they lost in past four years. Pakistan’s textile exports have declined from $13.50 billion in 2013 to $12.1 billion in the last fiscal. The overall decline in the last four years is only $1.4 billion, whereas the fall in non textile stood at $3.5 billion. On average, textiles account for 55 percent of Pakistan’s total exports; however, its share rose to 60 percent last fiscal. The lower decline in textile exports and higher in non textiles shows that there is definitely something wrong with the government policies. The non textile exporters claim that the smaller decline in textile exports was more due to facilitations, the government provides to textile sector over other sectors. They added that for instance textile mills are given priority in the supply of power and gas. They are also preferred by the financial sector. An interesting point in this regard is that the exports of value-added apparel textiles have not been affected by export decline. This sub sector was probably boosted after Pakistan was awarded GSP Plus status four years back. The point to ponder is that what type of support each sub sector of textiles requires. Ten years back Pakistani basic textiles were the most efficient amongst its competitors. Today they are not efficient as most of the sector is operating on 10-year old technology. The government support is provided if any sector comes under stress from external pressures. However it is not prudent to subsidise sectors that are inefficient. Subsidies to inefficient sectors go down the drain. Basic textiles need a new beginning and government support to upgrade the technology. Many big textile houses have had the opportunity and resources to go for new technology but they waited for the government to provide some support. During this wait and see policy Bangladesh, Vietnam, India and China imported huge quantity of basic textile machinery. These four countries in fact were the main importers of yarn and fabric from Pakistan. Now these countries, particularly India and Vietnam are exporting yarn. The yarn imports from India to Pakistan have increased tenfold in last four years and yarn exports from Pakistan to India have declined to zero.

Source: The News International

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Karl Mayer Rotal unveils Prodye-R indigo dyeing machine

Karl Mayer’s Italian subsidiary, Karl Mayer Rotal, involved in the manufacturing of machinery for the textile industries including parts, attachments, and accessories, is making a name for itself with the new Prodye-R, an indigo dyeing machine for stylish denim production of brand manufacturers, and a huge project in the rope dyeing sector. The Prodye-R indigo dyeing machine can deliver all these benefits and can also be used in the genuine/standard segment. The Prodye-R increases efficiency and reduces costs in rope dyeing. The indigo rope dyeing machine operates with just eight dyeing units to produce deep, pure shades with a dye application of up to 5.5 per cent of the yarn weight. The short wet zone reduces the bath volume by up to 25 per cent. Furthermore, when changing the ball, the warp length remaining in the machine, which is unusable, can be reduced by 20 per cent. Overall, the machine uses less energy and water and fewer chemicals. In fact, the water consumption can be reduced by roughly 30 per cent. The programmable cans, into which the dyed ropes are laid in a precise arrangement, also make the long chain beaming process more efficient. The Prodye-R complements Karl Mayer Rotal’s product portfolio. With the new dyeing machine, the Ball Warper, The Long Chain Beamer, and the Prosize, the company is the only global manufacturer involved in the one-stop provision of highly innovative rope dyeing technology. One of the biggest companies involved in making-up denim clothing in Turkey, the Taypa Group, is cooperating with Karl Mayer Rotal on a huge project in Algeria. A textile complex for producing textiles and apparel is to be built on an area of 250 hectares in this North African country, which will create 25,000 new jobs. The planned annual output is 60 million metres of fabric per year. In December 2013, Taypa set up a joint venture with two state-run Algerian textile companies to implement these ambitious plans. In the first stage of this project in the province of Relizane, eleven integrated factories, mainly for producing jeans and other apparel fabrics, will be set up by the spring of 2018. Karl Mayer Rotal will supply the warp preparation technology for producing the denim. The first large shipment left for Algeria in the middle of May 2017.

Source; Fibre2Fashion

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Bangladesh : Textech 2017 to focus on technological trend in textiles

The 18th Textech Bangladesh 2017, the biggest international exhibition on textile and garment sector, will focus on the emerging technology for the textile and garment industry. The four-day event will kick off from August 9, 2017 along with two concurrent fairs, 12th Dhaka International Yarn & Fabric Show 2017 and 28th Dye+Chem Bangladesh Expo 2017. Around 1150 companies with 1400 booths from 25 countries will participate in the programmes. It will be a one-stop single platform to showcase the latest developments and emerging technology for this industry. Textech will be the biggest meeting place in Bangladesh for buyers and suppliers and will also provide an interactive platform for exhibitors to generate business through displays and direct interaction. The yarn & fabric show will be the biggest networking place for buyers and manufacturers and suppliers of equipment & technology of international yarn & fabric industry while the Dye+Chem expo will focus on the entire textile and garment industry of the world as well as the entire export sector of Bangladesh. The exhibitions hosted by (Conference & Exhibition Management Services) CEMS Global will also organise a seminar titled ‘Chemical Safety and Management: Bangladesh Perspective’ on August 10, 2017.

 Source: Fibre2Fashion

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