image rotation

MARKET WATCH 10 NOV, 2017

NATIONAL

INTERNATIONAL

Textile sector upbeat after Centre hints at GST relief

Surat: Textile entrepreneurs and traders in Surat are pinning hopes on Goods and Service Tax (GST) Council to take proactive decision to resolve their pending demands for simplification and tax relief under the GST when they meet on Friday. After the representatives from textile sector met Union minister of textiles Smriti Irani in New Delhi on Wednesday, it is believed that the central government has seriously started working in the direction to resolve the pending demands of the textile sector.
"We had an exhaustive meeting with Irani. Looking at the kind of response, there are ample reasons to believe that the government is in mood to resolve the GST issues faced by the sector. Almost 70% of our demands will be accepted," chairman of Federation of Indian Art Silk Weaving Industry (FIASWI) Bharat Gandhi said.  "Some of the key demands include the accumulation of tax credit, opening stock credit, simplification under ITC-04, 18 per cent GST on job-work for unregistered firm, reduction of 12% GST on velvet fabric," he said. The meeting with Irani took place at a time when Congress vice-president Rahul Gandhi had interaction with textile traders and entrepreneurs in the city, while BJP president Amit Shah organized a series of meetings with the representatives from power loom weaving sector, traders and textile processors over GST issues. President of Pandesara Weavers' Cooperative Society Limited Ashish Gujarati said, "The meeting with Rahul Gandhi, Amit Shah and Smriti Irani in last two days went off well. We are hopeful that the GST Council will announce key decisions on Friday." Leader of the textile sector asking anonymity said, "We asked Irani why the government took late decision to invite the textile community. She stated that the government was working on the demands from the past one month. However, I feel that the model code of conduct due to elections in Gujarat and Himachal Pradesh will delay the implementation in GST bill."

Source: Times of India

Back to top

Centre likely to announce procedure to address GST-related issues promptly

A day ahead of the GST Council meeting here, Congress-ruled states have sought a complete overhaul of the indirect tax regime with the highest slab at 18% instead of 28%. Congress-ruled states have written to union finance minister Arun Jaitley demanding “nothing less than a complete overhaul of GST structure.” “The highest rate should not be more than 18%,” said Karnataka minister Krishna Byre Gowda who is a member of the GST Council, said on Thursday. 

The government may not be averse to the revamp.

“The key agenda to be taken up is revamp of the 28% slab and the composition scheme for businesses as well as restaurants,” said Bihar finance minister and deputy chief minister Sushil Modi. “Most of the issues will be addressed.” “The Congress is in favour of inclusion of petroleum into GST,” Punjab finance minister Manpreet Singh Badal said at a press conference called by Assam Pradesh Congress Committee. Kerala finance minister Thomas Issac however is not in favour of including petroleum and real estate in GST till the time new tax regime settles down. Gowda said Congress had earlier said the GST rate should not be more than 18% but the government still went ahead and raised the slab. “There are many luxury and sin goods which would be taxed at a higher rate and under that premise, a rate of 28% was agreed upon by the council. But we find that a lot of items of mass consumption are also in the 28% slab,” he said. Many materials used for building a house such as tiles, bricks, cement, sanitary ware and taps are in the 28% slab and it is proving to be a burden for individuals building their homes, he said. “A builder is different because the builder gets input tax refund whereas a common person does not get any refund. So it is proving to be a costly affair and there is no justification in keeping construction materials in the 28% tax slab,” he said. Barring real goods of luxury or of sin nature, GST slab should be brought down to 18%, he said. “That has been our general position for a while. So we hope there will be a positive and a resultoriented discussion on this issue tomorrow... Over time, 12% and 18 % slabs should converge and only a few items should remain in the 28% slab,” he said. Puducherry chief minister V Narayanasamy said that handicrafts should be exempted from GST and compliances should be reduced. He claimed Congress-ruled states had been demanding a revamp in the GST structure, but the Centre never paid any attention and was now taking steps in view of the assembly elections in Gujarat. The GST Council is likely to review items in the 28% slab, some of which could be moved to 18% and 12% slab. It is also expected to simplify compliances for small and medium enterprises as well as large businesses. GST, a single tax that subsumed as many as 43 taxes and cesses, was rolled out on July 1. The government has been since trying to address hiccups through periodic GST Council meetings.

Source : The Economic Times

Back to top

Congress states seek full GST revamp, highest tax rate at 18 per cent

The GST Council is likely to review items in the 28% slab, some of which could be moved to 18% and 12% slab. A day ahead of the GST Council meeting here, Congress-ruled states have sought a complete overhaul of the indirect tax regime with the highest slab at 18% instead of 28%.Congress-ruled states have written to union finance minister Arun Jaitley demanding “nothing less than a complete overhaul of GST structure.” “The highest rate should not be more than 18%,” said Karnataka minister Krishna Byre Gowda who is a member of the GST Council, said on Thursday. The government may not be averse to the revamp. “The key agenda to be taken up is revamp of the 28% slab and the composition scheme for businesses as well as restaurants,” said Bihar finance minister and deputy chief minister Sushil Modi. “Most of the issues will be addressed.” “The Congress is in favour of inclusion of petroleum into GST,” Punjab finance minister Manpreet Singh Badal said at a press conference called by Assam Pradesh Congress Committee. Kerala finance minister Thomas Issac however is not in favour of including petroleum and real estate in GST till the time new tax regime settles down. Gowda said Congress had earlier said the GST rate should not be more than 18% but the government still went ahead and raised the slab. “There are many luxury and sin goods which would be taxed at a higher rate and under that premise, a rate of 28% was agreed upon by the council. But we find that a lot of items of mass consumption are also in the 28% slab,” he said. Many materials used for building a house such as tiles, bricks, cement, sanitary ware and taps are in the 28% slab and it is proving to be a burden for individuals building their homes, he said. “A builder is different because the builder gets input tax refund whereas a common person does not get any refund. So it is proving to be a costly affair and there is no justification in keeping construction materials in the 28% tax slab,” he said. Barring real goods of luxury or of sin nature, GST slab should be brought down to 18%, he said. “That has been our general position for a while. So we hope there will be a positive and a resultoriented discussion on this issue tomorrow... Over time, 12% and 18 % slabs should converge and only a few items should remain in the 28% slab,” he said. Puducherry chief minister V Narayanasamy said that handicrafts should be exempted from GST and compliances should be reduced. He claimed Congress-ruled states had been demanding a revamp in the GST structure, but the Centre never paid any attention and was now taking steps in view of the assembly elections in Gujarat. The GST Council is likely to review items in the 28% slab, some of which could be moved to 18% and 12% slab. It is also expected to simplify compliances for small and medium enterprises as well as large businesses. GST, a single tax that subsumed as many as 43 taxes and cesses, was rolled out on July 1. The government has been since trying to address hiccups through periodic GST Council meetings.

Source: The Economic Times

Back to top

Why compliance is low in GST

It’s more than four months since the Goods and Services Tax was introduced, and while consumers have learned to live with this, businesses are still struggling to adapt. The Government has been on its feet, tweaking rules periodically in an attempt to assuage sentiments. The GST Council that meets today is again expected to announce a slew of changes to the new tax regime. One aspect that could figure in the deliberations is the lower number of GST returns being filed when compared to the number of taxpayers registered on the GSTN. This issue is, however, expected to be addressed over the coming months. The mismatch could be partly due to the low level of computer literacy in the country, poor internet connectivity, glitches in the GSTN and the complex return filing mechanism. But the Government also needs to take a closer look at the denominator (number of eligible taxpayers registered with GSTN). Many of the registered taxpayers could be below the threshold limit for GST and hence not required to file returns. As these businesses de-register from GSTN, the gap can reduce. Also, lack of awareness about the need to file return in every State or to file nil returns could also account for the lower compliance rate. These issues can be addressed with better outreach. The CBEC has reported that only 64 per cent of eligible taxpayers filed the summary return, GSTR-3B, for July. This number fell further to 55 per cent for August GSTR 3B returns. The number of GSTR 3B filed for July, August and September were 42.91 37.63 and 38.38 lakh respectively. Even after accounting for composition dealers and those who have not completed the registration formalities, the gap appears large. Figures for the number of taxpayers who have filed the GSTR-1 and 2 for July are not available, but the press release of CBEC indicates that around 30 lakh taxpayers could be filing GSTR 2 returns for July.

The registrations

These numbers appear quite inadequate when compared to the number of registrations on the GSTN. According to CBEC, total GST registrations as on August 29, 2017 were 72.33 of whom 13.8 lakh were yet to complete procedural formalities. Almost 19 lakh new taxpayers are reported to have registered with the GSTN by August.  While the registration number is impressive, a closer look at the manner in which this was achieved will also help explain the lower compliance statistics currently being seen. The revenue department was under immense pressure to roll out GST in the early part of 2017 and to do that it had to focus on two aspects — one, getting the technology platform for GST ready and two, ensuring that there were enough taxpayers ready to start filing returns under the new system. The easiest way to ensure that there were enough taxpayers was to migrate the existing taxpayers registered for sales tax, VAT, excise duty and service tax to GST. So all of them were given a provisional GST number and migrated to the GSTN. There were about 65 lakh VAT dealers or traders, 26 lakh service taxpayers and 5 lakh excise duty assesses in the earlier regime, before July. It is possible that some taxpayers were registered for both VAT and service tax or excise duty. If overlaps are removed, the number of indirect tax assessees before July could be around 75 lakh. The revenue has claimed that migration of the older taxpayers was almost 100 per cent completed by July.

Hasty step

But in the haste to migrate the taxpayers, many businesses below the ₹20 lakh threshold for GST have also been migrated from earlier tax regime to the GSTN. The threshold limit for VAT dealers was ₹5 –10 lakh and it was ₹10 lakh for service providers. Recently, a provision has been made allowing these taxpayers below the threshold to de-register themselves. Since VAT and sales taxpayers accounted for around two-third of the indirect taxpayers under the old regime, it is highly likely that the registrations on the GSTN will come down in the following months, reducing the gap to some extent. There could be other reasons why GST returns are not being filed. But these can be addressed by increasing the outreach programme and educating taxpayers. Under GST, a taxpayer has to file GST returns even if he does not make any supplies in a month. Many taxpayers could be ignorant of this rule, thus not filing returns. Some taxpayers with operations in multiple States might not have filed returns in States where there was no business conducted. Businesses that were paying service tax under the earlier regime are finding it especially difficult to cope with the new system where they have to register in each State they operate in and file monthly returns for every State. This is a significant jump from earlier system where one centralised return was filed once in six months. Also, the GSTN does not allow simultaneous filing of GSTR 1 and 2. So those who wish to file GSTR 1 for July have to wait till the window for GSTR 2 is closed, as both the returns cannot be filed simultaneously. This could also have led to fewer returns being filed.

Not a worry, though

The tax collections between July and September, of ₹2,75,102 crore, is not bad, implying that the larger taxpayers, accounting for a bulk of the collections, are already compliant. That said, the issues faced by smaller taxpayers in meeting the increased compliance burden cannot be ignored. The revenue department needs to increase the staff employed to answer queries of taxpayers and to address their issues. Once a cycle of GSTR-1, 2 and 3 returns are filed, things can ease for most taxpayers.

Outreach needs to be strengthened so that the new taxpayers below the threshold limit who have voluntarily signed up for GST, do not de-register due to the complexity of the process or system glitches. Registrations should be allowed in windows of a month every year, in the first five years of GST, to help expand the tax base gradually.

Source : Business Line

Back to top

As crude prices rise, govt may cut excise on petrol, diesel: Pradhan

With global crude oil prices breaching the $60-a-barrel mark, the Centre on Thursday indicated it could examine the possibility of a further cut in excise duty on fuel. “Let us see,” Petroleum Minister Dharmendra Pradhan said when asked about the scope of a further cut in excise duty. On October 3, the Centre had lowered the excise duty on petrol and diesel by ₹2 a litre to cushion the impact of high prices on the common man. However, the cut was not easy for the Exchequer, which faces a revenue loss of ₹13,000 crore in the second half of the financial year. The Finance Ministry had taken $60/barrel as the price point to work out the numbers in this year’s Union Budget. Sources said any decision on a further cut in excise duty would be taken after discussions with the Finance Ministry. “We are monitoring the prices at present,” said an official source.

Back to top

Source : Business Line

PM to take stock of RCEP deal during Manila visit on Nov 12-14

Prime Minister Narendra Modi will be travelling to Manila to attend the India-ASEAN meeting and East Asia Summit from November 12-14 and is expected to take stock of the progress made and discuss ways to move forward on the China-led mega trade deal — Regional Comprehensive Economic Partnership (RCEP). During his visit, the Prime Minister will also discuss bilateral trade and investment issues with some countries within the 10-member ASEAN (Association of South-East Asian Nations) bloc consisting of Thailand, Singapore, the Philippines, Vietnam, Cambodia, Laos, Myanmar, Brunei, Indonesia and Malaysia, said Preeti Saran, Secretary (East), Ministry of External Affairs (MEA), here on Thursday. In his bilateral meetings with ASEAN countries, Modi will focus on taking stock of the progress being made and also the stumbling blocks at the ongoing RCEP talks being discussed among China, India, ASEAN, Australia, Japan, South Korea and New Zealand, sources told BusinessLine. RCEP talks were launched officially in 2012. However, since then they have faced several challenges and the countries are yet to finalise the products or tariff lines on which duties will be eliminated to boost greater trade in goods and services within the member countries. The talks have moved at a snail’s pace due to India’s reluctance to offer greater duty cuts to Chinese goods. During the last round of negotiations held in South Korea, member countries failed to arrive at a definitive mandate to set the ball rolling during the Manila meet, sources said. The summit-level meeting of RCEP leaders was preceded by a meeting of Trade Ministers from member countries. Sources said during the Summit, Modi is expected to come under tremendous pressure to commit to deeper tariff cuts. The objective of having the RCEP is to eliminate duties on about 90 per cent of the traded tariff lines within the member countries.

Under pressure

Modi is also expected to raise the issue of tapping the full potential of the India-ASEAN goods Free Trade Agreement (FTA), which was implemented in 2010 and the pact on services and investment that came into effect in 2015.

Source: Business Line

Back to top

Rupee extends gains against US dollar

The rupee today firmed up by a modest two paise to end at 64.94 against the US currency in a quiet trade on mild dollar selling by banks and exporters in the face of subdued overseas sentiment. Forex market sentiment remained cautious as participants preferred to stay on the sidelines while awaiting cues from US President Donald Trump's diplomatic tour of Asia. Heavy offloading by foreign portfolio investors and funds also weighed on the trading front as they sold shares worth a net Rs 3,838.27 crore yesterday. Domestic equity markets showed some stability after a two-day selloff and managed to end in a positive terrain ahead of the outcome of the GST Council meet tomorrow. The BSE Sensex recovered 32 points to settle at 33,250.93, while Nifty added 5.80 points at 10,308.95. In the meantime, crude prices seesawed as conflicting catalysts stoked volatility on the back EIA inventory data. At the Interbank Foreign Exchange (FOREX), the rupee opened a tad higher at 64.95 from overnight close of 64.96 with lack of catalysts for strong momentum buying. After trading in a narrow range of 64.85 and 65.00 most part of the session, the local unit eventually ended at 64.94, showing a small gain of 2 paise. The rupee ended higher by 7 paise yesterday after a two- session fall. The RBI, meanwhile, fixed the reference rate for the dollar at 64.8967 and for the euro at 75.3061. On the global front, the greenback slipped lower against other major currencies as uncertainty over the fate of a major US tax reform bill continued to weigh. The dollar index, which measures the greenback's value against a basket of six major currencies, was down at 94.47 in early trade. In cross-currency trades, the rupee strengthened against the Pound sterling to settle at 85.14 from 85.28 per pound. The home currency, however, continued to decline against the Japanese yen to finish at 57.31 per 100 yens from 57.21 and also dropped further against the euro to close at 75.53 from 75.35 yesterday. Elsewhere, European forex market witnessed lacklustre activity and remained relatively uneventful ahead of Brexit talks and also autumn economic forecast from European Commission later in the day. In forward market today, premium for dollar drifted further due to sustained receiving from exporters. The benchmark six-month premium payable in April declined to 132-134 paise from 135-137 paise and the far forward October 2018 contract moved down to 272-274 paise from 275-277 paise on Wednesday. On the international energy front, crude prices held steady after falling late in the previous session in the face of higher US supplies and some indicators of a demand slowdown, though fall was capped, supported by ongoing supply cuts led by OPEC and Russia.

Source: Financial Express

Back to top

I challenge Rahul Gandhi to debate on textile industry: Smriti Irani

 

GANDHINAGAR: Smriti Irani, Union textiles and I&B minister and Rajya Sabha MP from Gujarat has alleged that though small businessmen and traders in Surat are ready to embrace GST, Congress leaders are trying to "incite" them against the BJP government. Irani was in Ahmedabad to campaign in Vejalpur constituency. Later, addressing reporters, she said, "I challenge Rahul Gandhi to debate with me either in the Parliament or outside about technicalities and issues of textile industry in Surat and Gujarat, as well as on the development done by NDA government and UPA regime for this sector," said Irani. Irani sharply contested the Congress vice president's charge that the GST and note ban "broke the legs" of Surat, India's textile hub.
"Traders and businessmen are ready to be tax compliant and my ministry is doing everything to solve problems they are facing in shifting to the new indirect tax regime," said Irani. She said during her previous visits to Surat, traders, weavers, small businessmen and women working in the industry brought up before her some system-related issues and all possible help was extended to help make them tax compliant. "But as polls are approaching, Congress leaders are trying to incite people," Irani told reporters here. She said, "Yesterday, a delegation from Surat's textile industry came to Delhi and gave a public statement that they are ready to embrace GST. They want to be tax complaint. They just want solution to some of the challenges posed by the new system." Irani said issues faced by them were conveyed to the GST Council for resolution. On Wednesday too, the GST council was told about their concerns. "The process was going on for the last 2-3 months and several issues have already been resolved," Irani said.

Source: Times of India

Back to top

Manipuri weavers showcase their talent at Handwoven Garment Fair

Imphal (Manipur) [India] November 9 (ANI): The handloom industry of Manipur has played a pivotal role in supporting the state's economic sustenance. The traditional skill of handloom weaving employs a large part of the state's population directly or indirectly. However, often the full potential of this industry remains untapped as the products of these weavers often don't go beyond the local markets. To enhance the growth of the handloom industry and to attract more investors to tap the immense potential of the state and the region as a whole, the state government has undertaken an initiative to roll out the end products, produced in the Apparel and Garment Centres in Manipur's Lamboikhongnagkhong to the world market to create a business hub in the state. The garments produced by these weavers were showcased at the Handwoven Garment Fair, held recently in Imphal. "We are trying to emphasize more on the hand woven fabric of Manipur. So basically we are trying to promote the state's weavers and the tailors who are being employed from Manipur. Basically, it will be totally made in Manipur product," Roslyn Khongsai, Design Expert at Apparel and Garment making centre. Traditional outfits ranging from kurtas, khadi waistcoats, hand-woven Manipuri outfits like Phanek and Innaphi were sold at the fair. People from all walks of life thronged the fair and were visibly smitten with the intricate work that goes into making these garments. Manipur's Minister for Commerce and Industry, Thongam Biswajit Singh, was the chief guest at the event. Singh said that the government was also considering cotton plantation at Jiribam and Kwatha as a pilot project and revival of the spinning mill was very much on cards. "The arrangement made by the principal adviser to Chief Minister is that the material will be coming from Myanmar at the lowest rate and what we need to do is only stitching and threading," Biswajit Singh said. It is worth mentioning that this fair is the first such initiative by the Manipur Government in collaboration with the Centre to make the 'Make in Manipur' concept a reality at the grassroots level.

Source: ANI News

Back to top

MP promises support to Brandix Apparel Park

Anakapalle MP Muttamsetti Srinivasa Rao on Thursday said the State government would extend its full support to bring investments to the Brandix Apparel Park developed at Atchutapuram near here. He was speaking after inaugurating the second phase of solar power plant to generate 40,500 KWH units per year, LED street lights in non-processing area and a modern gym along with Yelamanchili MLA Panchakarla Ramesh Babu and Zilla Parishad Chairperson Lalam Bhavani Bhaskar. All the three facilities cost around ₹1 crore. Speaking on the occasion, the MP said Brandix Apparel Park set up by Brandix India Apparel City (BIAC) had been helping locals, mostly women, in getting employment and pointed out that the establishment of 14 units in BIAC had provided jobs to 18,000 and asked the management to give top priority in providing non-technical jobs to displaced persons and people from neighbouring villages.

Source: The Hindu

Back to top

Farmers will lose Rs 36k-cr due to prices falling below MSP: Farmers' body

A mass assembly of farmer associations is planned in Delhi on November 20. The charge is that market prices have gone below the government-set minimum support price (MSP) for major kharif crops. As a result, farmers estimate they would lose about Rs 36,000 crore due to lack of government action. It could be as much as Rs 200,000 crore if the loss is estimated from the actual cost of production plus 50 per cent profit as assured by the ruling party in its election manifesto of 2014. The allegation and stir plan is from the All India Kisan Sangharsh Coordination Committee (AIKSCC), describing itself as a conglomeration of at least 150 small and big farmer bodies. “The number (of monetary loss) would be much more if more crops, including perishable items such as potatoes and onions, are considered,” said Yogendra Yadav, president of Swaraj Abhiyan and part of the AIKSCC. The loss estimates have been arrived at by multiplying the projected arrivals of seven main kharif crops in wholesale markets (mandis) in major producing states with the difference between the average mandi price and the MSP. The average mandi price has been arrived at from 100 major ones for each crops over a period of time. The crops taken for the Rs 36,000-crore loss calculation are paddy, maize, bajra, soybean, groundnut, cotton and urad dal (black gram). The amount to be sold (marketable surplus) was arrived at by deducting estimates of own consumption from the production estimates. “When compared to the comprehensive cost of production, the current mandi price of most kharif crops is much below, showing that farmers aren’t getting a decent return on their investment,” Yadav said. The plan for November 20 is for 50,000-100,000 farmers to assemble at a day-long ‘parliament’ of their own (kisan sansad). A simillar gathering was held some months earlier. “Farming today is in crisis and multiple efforts are needed to address it,” said Hanna Mollah, head of the Left-affiliated All Indian Kisan Sabha.

Source:  Business Standard

Back to top

CCI aims to procure 100 lakh bales this season

The Cotton Corporation of India (CCI) is prepared to procure some 100 lakh bales of cotton either at Minimum Support Price (MSP) or market prices this season with the cotton arrivals beginning in full swing, according to CCI chief MM Chokalingam. So far this season CCI has already purchased some 62,000 bales of cotton at Minimum Support Price (MSP). MSP purchase has already begun in Telangana and some parts of Gujarat, prices are ranging between Rs 37,000 and Rs 38,500 per candy. In a couple of states, cotton prices are going down below MSP. In Maharashtra, after November 15, prices are expected to decline as well. Last week, the India Cotton Federation had written to Prime Minister Narendra Modi estimating a record 400-lakh-bale output for the cotton season 2017-18 due to a 20 percent increase in the acreage urged the government to direct the CCI to procure 100 lakh bales. Gujarat, daily arrivals of raw cotton (kapas) have touched about 28,000 bales and are expected to rise significantly in the next fortnight. Daily arrivals at key cotton growing regions across the country are currently 1.30 lakh bales on a daily basis. CCI has entered the market in Gujarat to procure cotton from 17 out of 22 centres in the state. Normally, the CCI establishes at least 340 purchase centres across the country. Procurement has started in some parts of Gujarat because of low prices. CCI is paying MSP plus the Rs 500 per quintal bonus announced by the state, thereby effectively putting the procurement prices at Rs 4,750. Procurement in other states, including Maharashtra, Andhra Pradesh and Karnataka, will begin once the arrivals pick up. As per the Centre’s first advance estimate, cotton production is likely to reach 3.22 crore bales, while the trade estimates the output to cross 4 crore bales. Gujarat is likely to produce about 25% of the country’s overall production. Cotton acreage in the state has increased to 26.4 lakh hectares against 24 lakh hectares last year. Nationally, the acreage is estimated to be higher by 10% at about 111.55 lakh hectares (92.33 lakh hectares). Internationally, prices may remain under pressure as higher crop is expected. A latest estimate put out by the International Cotton Advisory Committee projected 2017-18 global cotton production at 255.7 lakh tonnes against 230 lakh tonnes in 2016-17. Maharashtra cooperation minister Subhash Deshmukh had directed Agriculture Produce Market Committees (APMC) to commence online registrations of farmers for the purchase of cotton from October 18 for the cotton season of 2017-18. The government to extend the necessary marketing support to the cotton growers in selling their cotton produce at most competitive prices in the various market yards in all cotton-growing states has appointed two agencies CCI and Nafed. Cotton MSP has been raised by Rs 160 per quintal to Rs 4,020 per quintal for medium staple cotton and Rs 4,320 per quintal for long staple cotton.

Source: YarnsandFibers

Back to top

Global Crude oil price of Indian Basket was US$ 62.42 per bbl on 08.11.2017

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$ 62.42 per barrel (bbl) on 08.11.2017. This was lower than the price of US$ 62.83 per bbl on previous publishing day of 07.11.2017. In rupee terms, the price of Indian Basket decreased to Rs 4060.91 per bbl on 08.11.2017 as compared to Rs. 4071.49 per bbl on 07.11.2017. Rupee closed weaker at Rs. 65.06 per US$ on 08.11.2017 as compared to 64.81 per US$ on 07.11.2017. The table below gives details in this regard:

Particulars

Unit

Price on November 8, 2017 (Previous trading day i.e. 07.11.2017)

Crude Oil (Indian Basket)

($/bbl)

   62.42                         (62.83)

(Rs/bbl)

  4060.91                   (4071.49)

Exchange Rate

(Rs/$)

   65.06                         (64.81)

 

Source: PIB

Back to top

Global Textile Raw Material Price 2017-11-09

Item

Price

Unit

Fluctuation

Date

PSF

1353.82

USD/Ton

0%

11/9/2017

VSF

2246.32

USD/Ton

0%

11/9/2017

ASF

2653.38

USD/Ton

0%

11/9/2017

Polyester POY

1354.58

USD/Ton

0.17%

11/9/2017

Nylon FDY

3542.86

USD/Ton

0%

11/9/2017

40D Spandex

5955.02

USD/Ton

0%

11/9/2017

Polyester DTY

3708.70

USD/Ton

0%

11/9/2017

Nylon POY

5698.73

USD/Ton

0%

11/9/2017

Acrylic Top 3D

1582.98

USD/Ton

0%

11/9/2017

Polyester FDY

3331.80

USD/Ton

0%

11/9/2017

Nylon DTY

2789.06

USD/Ton

0%

11/9/2017

Viscose Long Filament

1688.51

USD/Ton

0.45%

11/9/2017

10S OE Cotton Yarn

2222.96

USD/Ton

-0.03%

11/9/2017

32S Cotton Carded Yarn

3508.19

USD/Ton

-0.02%

11/9/2017

40S Cotton Combed Yarn

4041.88

USD/Ton

-0.02%

11/9/2017

30S Spun Rayon Yarn

2924.74

USD/Ton

-0.51%

11/9/2017

32S Polyester Yarn

2068.43

USD/Ton

0.37%

11/9/2017

45S T/C Yarn

2879.52

USD/Ton

0%

11/9/2017

40S Rayon Yarn

2201.10

USD/Ton

0%

11/9/2017

T/R Yarn 65/35 32S

2442.31

USD/Ton

0%

11/9/2017

45S Polyester Yarn

3075.50

USD/Ton

-0.49%

11/9/2017

T/C Yarn 65/35 32S

2487.54

USD/Ton

1.23%

11/9/2017

10S Denim Fabric

1.41

USD/Meter

0%

11/9/2017

32S Twill Fabric

0.87

USD/Meter

0%

11/9/2017

40S Combed Poplin

1.21

USD/Meter

0%

11/9/2017

30S Rayon Fabric

0.67

USD/Meter

0%

11/9/2017

45S T/C Fabric

0.72

USD/Meter

0%

11/9/2017

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.15076 USD dtd 9/11/2017). The prices given above are as quoted from Global Textiles.com.  SRTEPC is not responsible for the correctness of the same.

Back to top

Meeting on TPP deal between eleven nations kicks off

Ministerial meeting on the Trans Pacific Partnership free trade agreement between 11 signatory countries kicked off Wednesday and expected to run depending on the progress of negotiations. The meeting aims to reach a broad agreement for the pact to take effect without the United States, which has pulled out of the deal. At a breakfast meeting held on the first day, Toshimitsu Motegi, minister in charge of economic revitalization, called on the participants to sort out the issues to be addressed to reach an agreement, as well as specific points to be discussed. The countries are yet to reach a broad agreement on some issues, such as which agreed-upon regulations should be frozen until the United States returns. Through talks by chief negotiators of these countries and other means, decisions have been made on about half of the approximately 50 items suggested for freezing. The remaining are set to be decided politically. Motegi plans to hold bilateral talks with ministers from almost all the countries and urge them to work toward a broad agreement to be reached as soon as possible. Vietnam is also the focus of attention. It disagrees with other countries over such issues as relaxing rules for eliminating tariffs on textile products, a field in which it is strong, and securing the free flow of data used in e-commerce transactions.

Source: YarnsandFibers

Back to top

Brazilian textile firms to assess raw materials in Egypt

Backed by the Arab Brazilian Chamber of Commerce and the Consulate of Egypt in Sao Paulo, three Brazilian companies — textile maker Fiama, yarn maker Círculo and elastic band manufacturer Damenny — have been invited by the Egyptian Government to the November 11-12 textile industry expo Destination Africa in Cairo to assess Egyptian raw materials. The three enterprises will be involved in a textile industry purchasing project carried out by the government of Egypt, according to a news agency report. The expo will feature 100 companies from 15 African countries and over 300 international buyers. About 1,300 tonnes of Egyptian cotton and yarn were imported to Brazil till September this year, with sales amounting to $6 million. In September, a Mercosur-Egypt free-trade agreement entered into force that covers cotton and textiles.

 

Source : Fibre2fashion

Back to top

Apparel Imports Increased in September, Led Largely by Vietnam

U.S. apparel imports rose in September, reversing a three-month trend of declines, but the increase was below that of overall goods and services imports, according to data released late last week by the U.S. Census Bureau. Total apparel imports increased by 2.6% in the month to $8.5 billion on a CIF basis, while total U.S. goods and services imports increased by 4.7%, to $196.5 billion. Apparel exports dropped by 1.4% to $482 million. Total U.S. goods and services exports increased by 2.6%.Year-to-date apparel imports have fallen compared to last year, according to OTEXA, the International Trade Administration’s Office of Textiles and Apparel. Total apparel imports declined by 1.4% on an MFA basis in the first nine months of the year, to $60.8 billion from $61.6 billion in the same period in 2016. Among the top 10 U.S. apparel trading partners, only Vietnam, India, Nicaragua and Mexico have grown their apparel shipments to the U.S. this year. On a square meter equivalent (SME) basis, imports have edged up by 1.1% this year, continuing the trend toward lower-cost goods, despite upward pressure on labor and raw material prices. The average cost per unit of an imported garment fell by 2.4% in the first three quarters of the year. The average cost per SME increased by 12.5% from Mexico and 4.2% for El Salvador, and was flat from Honduras, but dropped for all other key trading partners, with the cost per SME from China suffering the biggest drop, down by 6.2%.Vietnam’s apparel shipments to the U.S. continued to grow, increasing by 6.5% to $8.7 billion in the year-to-date period, gaining over a percentage of U.S. apparel import market share so far this year, to 14.4%.Mexico’s apparel exports to the U.S. increased by 6 percent to $2.7 billion, helped by near-sourcing efforts on the part of many U.S. brands. Mexico’s share of U.S. apparel imports increased by 0.3 percentage points. China has lost the most share of U.S. apparel imports in the period, down 90 basis points to 31.8% of the total, to $20.4 billion. Bangladesh also lost share, with apparel shipments to the U.S. down by 5.6% year-to-date, to 6.8% of total U.S. apparel imports.

Source: Sourcing Journal Online

Back to top

Pakistan :Textile sector’s spinning dilemma

 

LAHORE: Things are getting worse for the basic textile sector having lost sizeable domestic market due to closure of thousands of power looms and slow yarn exports. To top it all, now smog is damaging the quality of the cotton crop. In the current scenario, even the efficient mills are finding it difficult to operate at optimum capacity. Quality cotton is simply not available in the market; those having some stocks are charging commercially unviable rates. Cotton imports from India have been effectively stopped due to non-tariff barriers like quarantine and testing of quality of the commodity at places far away from the Wagah border. Going is getting tough with every passing day, a spinner said. The spinning industry has become unviable not only due to high power and energy cost but also due to its inability to operate at full capacity. Spinning mills, according to experts are designed the world over to operate 24/7 at full installed capacity. Operating a spinning mill substantially below its capacity increases its cost, as the high fixed charges are then divided on the operating capacity. Experts point out that besides the closure of over a hundred mills; the remaining mills are finding it hard to operate at full capacity. Even after reducing production, most of the surviving mills are sitting on huge unsold stocks. The production cost has also increased substantially due to high power cost and higher cotton rates. If the situation persists, many more mills will go out of production. The mills that are surviving are mostly composite mills that produce yarn and convert it into fabric. The firms that are thriving are those that process their fabric and convert it into apparel. It is interesting to note that most of these composite units have also upgraded their technology. These mills are operating at optimum capacity and their costs are much lower than the mills that are in trouble. The mills that are producing yarn from inefficient technology have unfortunately lost their main local consumer; the small power loom owner.

 

Hundreds of thousands of these looms are closed after the export of fabric declined. These looms also lost the domestic market to the high value brands that have emerged in the domestic market in recent years. Unfortunately, this cyclic process has played havoc with both the spinners and the power loom sector. If we look at big names in the basic textile industry they are on recovery path after a brief period of recession. These big textile houses soon realised that they will not only have to upgrade their technology but also find a solid footing in the domestic market. Two years back the share of domestically produced textiles was 20 percent in the domestic market, while 80 percent was exported. Now 35 percent of the textiles produced in the country are consumed locally and only 65 percent is exported. In value terms, the sales of textiles sold in the domestic market has reached Rs800 billion (nearly $8 billion) while the exports are down to $12 billion only. It is worth noting that the basic textile exports have declined across the board affecting both the inefficient and efficient mills and the composite mills. The composite mills have made up the export loss by increasing value-added apparel exports. The efficient mills belonging to big houses created a loyal domestic market. They opened hundreds of brand outlets across the country and have raised their rates substantially much more than what they used to get when they disposed their fabric through dealers. Another interesting point is that the sales in terms of value have increased substantially, though the sales in terms of quantity have declined. The earnings however are higher than before. These brands have gone into stitching to cater to both domestic and foreign markets. They are expecting to make a mark in value-added exports instead of yarn and fabric export. The future of inefficient mills is bleak. Their main consumers were power looms that no more exist in large numbers. In fact Faisalabad that used to be the major producer of power loom fabric has turned into a junkyard of these looms, which are being sold at or below the rate of steel to the junk dealers.

 

Source: The News

Back to top

Pakistan : Encouraging the produce of export-worthy apparel

KARACHI: Fashion Pakistan, one of the leading platform for Pakistani fashion designers, announced its partnership with the Trade & Development Authority of Pakistan (TDAP), for its upcoming Made in Pakistan fashion showcase, scheduled to be held today (Friday) until Sunday in Karachi. The Made In Pakistan fashion showcase is being held to produce export worthy collections by established designers and as a stepping stone for eminent designers under Millennial Fashion Platform who then will be linked with the industry to produce the collections for the export markets if the orders are procured. Besides providing them solid experience and mentoring in their field, and a chance for their work and talent to be recognised, the aim is to provide and encourage production of value added products as it is the way forward making our fashion industry competitive in international markets by building on relationships with buyers, both overseas and domestic, and establishing and strengthening ties with international businesses. Made In Pakistan is the first event of its kind, providing premium exposure to established and emerging fashion designers in the industry. The event will showcase collections by Amir Adnan, Aamna Aqeel, Fnk Asia, Nova Leather, Hassan Riaz, Tena Durrani, Deepak Perwani, Jafferjees X Wardha Saleem, Zuria Dor, Rizwanullah, Adnan Pardesy, Nauman Arfeen, The Pink Tree Company and Gulabo by Maheen Khan. This year, Fashion Pakistan will also be launching 10 emerging designers under Millennial Fashion Platform that will be happening Sunday, which will be the Day 3 of the Made In Pakistan Event. Designers showcasing are Farah Usman, Sundus Talpur, Salman Javed, Zainab Khalid, Amna & Rida, Shahmir Ansari, Farah Asad, Sobia Halar, Naina Bhagwati and TIP Collective Showcase. Commenting on the event and partnership with TDAP, Fashion Pakistan CEO Feri Rawanian said, “As Pakistan is a textile based economy and largely dependent on exports, this year the numbers have shown that due to competitive markets the export have dropped by $2 billion. Most of the manufacturing has moved to countries like Bangladesh, Cambodia, Sri Lanka and Vietnam. Some due to internal challenges and constraints but also largely due to lack of value-addition. We at FP want to develop our designers and provide them a stage so they have the right market insight and the tools to get in to this value added segment in-line with International trends and consumer demands and this collaboration with TDAP also aims to just do that.” Nubain Ali will be taking the role of the show director/choreographer for the event. Backstage and event management will be done by Production 021. Hair and Make-up will be handled by Nabila’s N-PRO & N-GENTS and Tehmina Khalid’s Take II will serve as the official PR for the event. Established in 2007, Fashion Pakistan’s objective is to foster and promote the Pakistani fashion industry both locally and internationally, encourage excellence in design, and build alliances with associations both within and outside Pakistan. The TDAP, which was established on November 8, 2006, under a Presidential Ordinance, shall have Ministry of Commerce as its administrative ministry. TDAP is the successor organisation to the Export Promotion Bureau and is mandated to have a holistic view of global trade development rather than only the ‘export promotion’ perspective of its predecessor. Designated as the premier trade organization of the country, TDAP shall be a dedicated, effective, and an empowered organization, which shall be professionally managed.

Source: Daily Times

Back to top

Pakistan : Textile industry seeks withdrawal of restrictions on cotton import

LAHORE - APTMA Chairman Aamir Fayyaz has urged federal government to immediately withdraw restrictions on import of cotton to let the industry meet the export requirement of quality textile products by the international buyers. The industry is badly in need of contamination-free fine and medium staple cotton to produce goods meant for exports. The government should immediately announce withdrawal of 4 percent Customs duty and 5 percent Sales tax as per the announcement made by the prime minister vide an initiative of export led growth package, he stressed. Also, he stressed, the government must withdraw non-tariff measures (NTM)/restrictions on import of cotton from India and Brazil, which was restricted to import uptil 30th May 2017 since these cottons are being exported at all destinations without any such restriction. He said the local cotton production is estimated at 12 million bales for the current cottoncrop season. The industry has so far procured only around 40-50 percent of its requirement till date. Persistently hot weather in October 2017 has badly affected quality of cotton crop. Resultantly, cotton-dependent textile value chain has been exposed/forced to procure quality cotton to meet its demand for international buyers. He said the above restrictions were imposed despite promises to the contrary under PM Export Package to ensure right price to the cotton farmers and now that over 70% of the crop is out of the hands of farmers, the government must withdraw duties/restrictions (NTMs) immediately as an emergency like situation has developed to protect our international export orders. If this is not done swiftly, it is feared our textileproducers weighed down by unfair restrictions would not be able to compete with regional competitors. He has urged both the Prime Minister Shahid Khaqan Abbasi and the Federal TextileMinister Pervaiz Malik to enable the industry to procure raw materials at competitive price. The future exports of the industry are heavily dependent on producing quality products, he added. It is worth noting that 30 – 35 percent textile capacity has already been impaired and a continuity of these restrictions would prove detrimental across the textile value chain.

Source: The Nation

Back to top

Bangladesh Gets $457 Million in World Bank Financing to Aid Garment Industry and Infrastructure

Bangladesh is getting a financial boost from theWorld Bank to improve infrastructure and obtain long-term financing for industries ranging from container terminals to the garment industry. The financing will come from two different programs. A total of $357 million will come from an Investment Promotion and Financing Facility Project II from the World Bank, approved in April, which aims to increase long-term financing for infrastructure and to build capacity of the local financial institutions for promoting private sector-led infrastructure financing in container terminals, land ports, roads and bridges, as well as power and energy, information and communication technology, waste management, water treatment and energy saving equipment. The remainder of the funding will come from World Bank’s $100 million Export Competitiveness for Jobs Project, which promises to help create 90,000 jobs by focusing beyond the ready-made garments sector. It will help firms access international markets, overcome technology, infrastructure and skills shortfalls, plus enable those in the garment industry in Bangladesh to comply with international quality standards. The bank approved the Export Competitiveness for Jobs Project in June to help the country diversify export and create better jobs in targeted sectors. “Bangladesh is the world’s second largest garments exporter after China and it can boost growth by diversifying its exports, and repeat the garment sector success story in other sectors,” Qimiao Fan, World Bank country director for Bangladesh, Bhutan and Nepal, said when the deal was approved. “The project will help the economy to integrate further into the world trading system, and provide better jobs to Bangladeshi youth entering the labor market in the next decade, with a particular focus in improving female labor participation.” The project will help firms to access international markets and enhance their ability to comply with international standards through awareness building and matching grants. The project will also support marketing and branding efforts to strengthen linkages to existing and new markets. It will also address the shortage of skills development, especially in industrial training for women, as well as in infrastructure and technology. Although the garment sector constitutes 82 percent of exports, employment growth in the sector has stalled. The credit from the World Bank’s International Development Association, which provides grants or zero-interest loans, has a 38-year term, including a six-year grace period, and a 0.75% service charge. The World Bank has committed nearly $26 billion in grants and interest-free credits to Bangladesh overall, and in recent years, Bangladesh has been the largest recipient of the World Bank’s interest-free credits. Financing for both projects was formally delivered this week in the capital of Dhaka.

Source: Sourcing Journal Online

Back to top

Cotton production to exceed the rate of consumption

Global cotton stocks, outside of China, are expected to lift to a record 53 million bales for in 2017-18. Global cotton stocks, outside of China, are expected to lift to a record 53 million bales for in 2017-18.This is up from 41 million bales last season, according to a recent US Department of Agriculture report. The USDA report is also tipping 15% expansion in cotton production, which is outpacing rising global cotton use. China’s stockpile peaked at 67 million in 2014 and there was speculation a lot of what remained was poor quality. The USDA said 2017-18 cotton production in the US was forecast to decline by 643,000 bales from last year, but globally the drop would be offset by production increases in Argentina, Brazil and Greece. The US crop was affected by hurricanes Harvey and Irma and frosts.The USDA said major exporters in Central Asia, Africa, the US and the southern hemisphere would all “bear the brunt of the burden of high stocks.US exports are forecast to decline by 400,000 bales, “more than offset by higher exports from India, Brazil and Australia”, the USDA report said.

Source: India Infoline News Service

Back to top

Pakistan : Moderate cotton trading witnessed amid firm physical prices

Moderate cotton trading witnessed amid fine grades of lint in focus, during trading session in Sindh and Punjab stations. Demand for better grades of cotton remained on the higher side during trading session and spinners purchased the commodity for blending purposes as well as to reinforce their long positions. Buyers made deals for all grades of cotton that kept market’s bottom line prices firm. Buyers also made forward deals for second grade of lint at around Rs 6,425-Rs 6,450 per maund. Secondary buyers made deals for all grades of lint at around Rs 6,100-Rs 6,175 per maund, during trading session at Punjab and Sindh stations. Private sector commercial exporters made deals at Rs 6,000-Rs 6,100 per maund. Raw grades of lint changed hands at Rs 5,975 per maund, depending on trash level during trading session. Around 3,600 cotton bales changed hands while ex-gin price of cotton remained firm at Rs 6,400 per maund. In kerb market, trading took place in the range of Rs 6,000-Rs 6,200 per maund. Buyers also made one month forward deals at around Rs 6,175-Rs 6,200 per maund. Paucity of better grades kept buyers selective while sellers kept maintaining their price level on the higher side, amid shrinking of better grades at the ginneries. In the next coming trading session due to less availability of better grades, would likely keep prices firm at around Rs 6,400-Rs 6,575 per maund.

Source: YarnsandFibers

Back to top

Cotton production in Burundi faces a decline [Business Africa]

Cotton production in Burundi has witnessed a decline following a reduction in prices. Its impact on the economy helped in sparking growth in cotton cultivation areas like Cibitoke, Bubanza, and Bujumbura after cultivation was made compulsory in 1925.

In the following report Bridget Ugwe and Michael Odour take a look at the root cause of this decline and how farmers are handling the situation.

Source: Business Africa

Back to top

South  Africa : A cotton industry revival

The demise of the cotton industry along with the rest of the South African textile industry as a result of cheap imports from the East has been well documented. In the late 1980s the country produced about 80 000 tons of cotton fibre, but in 2013 it was only 5 200 tons. The turnaround has however started and is gathering momentum, with an output of 17 000 tons this year, and 40 000 tons projected for next year. Local beneficiation has grown from 7% in 2013 to 42% currently. The turnaround already benefits the whole supply chain from farmer – some small-scale and some commercial – to retailers like the Mr Price Group, Woolworths, Ackermans, and Edcon. It is a direct result of the Department of Trade and Industry’s (dti) Clothing & Textiles Competitiveness Programme (CTCP) that was developed in response to the crisis that cost the industry 101 000 jobs between 2002 and 2010. It started in 2013 when the dti approved a plan, submitted on behalf of Cotton SA, to fund an industry forum representing role players in the land based textile industry, says Heinrich Schultz, spokesperson of the Sustainable Cotton Cluster as this forum is now known. The Sustainable Cotton Cluster is a multi-stakeholder initiative, and the first cluster in the SA textile industry that is operating nationally. The aim of the Cluster is to create an enabling environment along the whole supply chain for the entire industry to grow. To that end, the stakeholders include suppliers of agricultural inputs, small-scale as well as commercial farmers, agro-processors, textile and clothing manufacturers, retailers and consumers. The manufacturing phase includes ginning and spinning to process the cotton fibre to yarn, then knitting or weaving to produce fabrics, then dying, printing and cut, make and trim to finish the product. The success so far is the result of a number of interventions at different stages of the supply chain, says Schultz. In one such intervention, the Cluster researched and demonstrated cotton stripper harvester technology to farmers to improve dry-land cotton production yields. This enabled the revival of dry-land commercial cotton farming, which used to be the backbone of cotton production in the 1980s, but became all but non-existent due to the high cost of harvesting. Other interventions include the innovation of business processes to ensure the industry continuously improves its competitiveness, the introduction of a cloud-based IT platform to ensure traceability of the product and the development of financing and insurance products. Each intervention is contracted with clearly defined key performance indicators. The Industrial Development Corporation (IDC) manages the financing for these Cluster interventions on behalf of the dti. One of the Cluster’s key successes is that it is able to obtain a legal commitment from the retailer to purchase the cotton fibre 12 to 18 months in advance. On the basis of these retailer commitments, the whole supply chain is contracted right back to the farmer, who has a buyer for his product before he has planted or completed his harvest.

This legal commitment unlocks new financing options, especially for small-scale farmers who do not own the land they cultivate, Schultz says. It works as follows: The farmer plants his cotton around October/November. During this period or in the preceding months, the retailer issues his promissory note, which is his legal commitment to buy the end-product and confirms the quantity of cotton needed. The cotton is harvested in April and the ginning process follows from May. Spinning takes place from June and July typically follows with the knitting and weaving processes. By August and September, the final product is manufactured and in October it should be in the retailer’s distribution centre. The full cycle takes 12 to 18 months, which means the Cluster is able to integrate retailers’ 18-month trend forecasting into the supply chain. The Cluster develops the integrated supply chain plan for the retailer and ensures costing at every stage in order to ensure a competitive price point. The Cluster has so far concluded 11 such integrated supply chain programmes and has contracts with the Mr Price Group, Ackermans, Woolworths and Edcon. Each programme is ring-fenced to ensure the retailer’s confidentiality. The product range includes underwear, sleepwear, general knitwear; including T-shirts, toweling and jeans and chinos. In fact, if all the cotton currently in the supply chain is expressed in T-shirts, the industry is now producing R2.4 billion worth of T-shirts per annum and the target by 2018 is to produce R4.2 billion per annum. Schultz says the market potential in South Africa is 300 000 tons of cotton, compared to the 17 000-ton fibre production this year. Cotton supply chains can later be expanded into the region, he says. He says cotton is a known cash crop for small-scale farmers. It is drought resistant and serves as a valuable nitrogen-fixer in crop rotation. In fact, in commercial production the maize and wheat yield increase by about 10% if it is preceded by planting cotton, he says. It is therefore one of the Cluster’s objectives to stimulate cotton production among small-scale farmers. The early legal commitment of retailers has unlocked off-balance sheet financing for farmers and other stakeholders in the supply chain. Schultz says while traditional financial institutions initially gave “the glazed doughnut look” when we asked for off-balance sheet financing, the Gro-Capital division of Afgri made a revolving facility available that currently stands at R25 million, but will total R75 million over five years. The Cluster facilitates the financing agreements and has also developed insurance products with underwriters such as Swiss RE and Guard Risk to mitigate the finance risk. The Cluster has also facilitated the financing of the investment in new capacity at one of the gins to accommodate the growing harvest. The four spinning plants (down from 22 in 2000) are currently operating at almost full capacity and represents the biggest industry bottleneck, Schultz says. The Cluster is currently investigating options to address the expansion of spinning capacity. “If only 50% of the T-shirt, towelling, chino and underwear market is localised, there will be an interim capacity gap, but with the potential to create 75 000 jobs,” he says. The current five-year agreement with the dti Cluster funding continues until March 2019, but indications are that it could be extended for a further five years. Antoinette has a passion for journalism, is incurably curious and loves asking questions for a living. She has specialised knowledge about the construction and energy sectors.

Source: Antoinette Slabbert

Back to top

The Apparel Industry is Ramping Up Its Apparel Recycling Efforts

On Nov. 15, events will be held throughout U.S. schools, workplaces and communities to raise awareness about recycling, as well as collect millions of pounds of materials that would otherwise clog the country’s landfills. While many might immediately think about glass, plastic and paper refuse, there are programs in place to help those who want to recycle apparel, too. But beyond America Recycles Day, salvaging clothes for other uses is a growing concern in the apparel industry. “Momentum is growing amongst sector leadership to align initiatives and join forces for scale and impact in this area,” says Ted van der Put, consultant and former executive advisor of IDH, Sustainable Trade Initiative, a public/private partnership for sustainable development. Among other things, IDH works on recycling programs with organizations like Fashion for Good, Cradle-to-Cradle, and Fair Fashion. “Most leading brands are active in this space.” IDH also collaborates with apparel labels that include C&A, Kering, Nike, Gap and H&M. But recycling clothing is a concern that is growing throughout the industry, from Patagonia and The North Face to American Eagle Outfitters and Madewell. The burgeoning need for apparel recycling has grown along with Americans’ appetite for trendy clothes. According to the Environmental Protection Agency, textile waste increased 38 percent between 2000 and 2011—a rate more than three times the overall waste volumes for all materials. The agency says the production, use and disposal of more than 19 billion garments per year is causing significant environmental and health problems. The Council for Textile Recycling reports that an sizeable 85 percent of America’s used clothes go to landfills. Just 15 percent are recycled or donated. Of the clothes that are recycled, 45 percent go to secondhand clothing stores, 30 percent are cut down and used as rags, and 20 percent are ground down and reprocessed (5 percent is considered unusable). For its part, Cotton Incorporated started the Blue Jeans Go Green denim recycling program 11 years ago, an initiative the firm describes as a “call to action to give old denim new life” by recycling it into natural cotton fiber insulation. Since its inception, the program has collected more than 1.5 million pieces of denim, enough to make a denim path the length of California. This also means 750 tons of textile waste—about the weight of 400 cars—was diverted from landfills. Instead, 2.7 million square feet of UltraTouch Denim Insulation—enough to line 46 football fields—has been produced. This year, various colleges throughout the country are participating in the Blue Jeans Go Green program, as are Rag & Bone and Madewell. The retailers are offering $20 or 20 percent off new denim purchases in exchange for the worn items. Low-priced, trendy fast fashion has been largely blamed for the rapid increase in apparel waste. That’s led H&M to attempt to combat the problem with a number of initiatives. It has in-store drop-offs for used apparel and it’s created collections from recycled clothes. Additionally, H&M’s Conscious Foundation began the Global Change Award a few years ago to challenge fashion innovators to create breakthroughs that will make the industry more “circular,” as in sustainable, especially with regard to recycling. H&M said in 2016 that just 0.1% of all apparel that’s collected by charities and recycling programs is turned into new apparel textiles. Van der Put says the sustainability message is resonating more than ever. “The story of the high environmental footprint and enormous end-of-life landfill consequences in apparel is gaining traction with the growing group of consumers that are aware of the need to transition to sustainable development models,” he says. Currently, 82 percent of Americans recycle cans, bottles and paper, while 65 percent recycle apparel or textiles, according to the Cotton Council International (CCI) and Cotton Incorporated 2017 Global Environment Survey. When asked why they recycle their used clothes, most respondents said, “Simply because it is the right thing to do.” Van der Put says, though, that the impact of these programs is still limited, even though the number of initiatives is growing. That’s because “the business scale versus ‘conventional’ materials is still very limited, hence the impact, too. However the sector will continue to find economically viable ways to scale these practices,” he says. “Before some of these initiatives have economic and replicable scale, a lot of early stage innovations need to be encouraged and explored.” On America Recycles Day, those consumers looking to recycle their used apparel can bring them to locations listed on the AmericaRecyclesDay.org site. Whether the clothes are reused or turned into another product, the industry’s recycling efforts will help consumers feel better about clearing so many items from their closets and drawers. One of the latest actions comes with the launch of the Apparel Impact Institute. The new collective includes the Sustainable Apparel Coalition, the Sustainable Trade Initiative, Target, PVH Corp., and Gap, among others. The aim is to work with brands and manufacturers “to select, fund, and scale projects that dramatically improve” the sustainability impact of the apparel and footwear industries. Increased participation by retailers and brands that join forces is key to growing sustainability momentum, Van der Put says. “And initiatives like the newly launched ‘Apparel Impact Institute’ can play an important role in that.” This article is one in a series that appears weekly on sourcingjournalonline.com. The data contained are based on findings from the Cotton Incorporated Lifestyle Monitor Survey, a consumer attitudinal study, as well as upon other of the company’s industrial indicators, including its Retail Monitor and Supply Chain Insights analyses. Additional relevant information can be found at CottonLifestyleMonitor.com.

Source: Sourcing Journal Online

Back to top

Taypa Tekstil to invest $800mn on its Algeria textile facility

Turkish denim manufacturer Taypa Teksil headquartered in Istanbul, one of the largest producers of denim in Turkey and supplier to brands including Levi’s and Calvin Klein, will be investing $800 million in its Algeria textile facility as interest and investment in African textile and apparel manufacturing is growing.The company hopes to begin construction of its facility in Algeria in 2019. The project will be undertaken in three phases, with completion expected by 2025. The site, in the Relizane region of Algeria, will be a fully integrated facility producing a variety of yarns, fabrics and finished product. The annual production capacity of the integrated facility is expected to be 30 million pieces, half of which will be for the Algerian market, and the remainder for export to the European Union and U.S. Tyapa having facilities in Turkey, Egypt and Algeria, said that the action is a bid to double production capacity in North Africa and diversify its product offering. Taypa exports 80 percent of its production to around 50 countries. It is also setting up a ready-to-wear facility in the Balkans, which it hopes to commission by the end of 2018. Taypa’s has already invested $20 million in ready-to-wear production in Egypt, where its annual production capacity is about 6 million units. The company is planning to open an office in New York at the Turkish Trade Center, where it will conduct the marketing for its Egypt operations. An office is also planned for London, which will host marketing, as well as departments such as showrooms and a design unit. According to Rand Merchant Bank’s recent investment report “Where to Invest in Africa 2018” states that Investment Attractiveness Index saw Algeria fall to 13th place from 10th on the list of countries with the most desirable investment environment.

Source: YarnsandFibers

Back to top

Bangladesh plans to set up six new denim mills in 2yrs

Bangladesh with an investment of $100 million is planning to set up at least six new denim mills which will become operation in the next two years as presently local suppliers can meet only 40 percent of Bangladesh's annual demand for denim fabrics and the rest is met through imports from China, India and Pakistan Currently, Bangladesh has 30 denim mills with a capacity to produce 435 million yards of fabrics a year, said Mostafiz Uddin, organizer of Bangladesh Denim Expo, who is also the managing director of Denim Expert Ltd. The increasing demand for denim fabrics from garment makers has encouraged the investors to establish new factories here. Existing investment in the denim sector is more than $1 billion and every year more people are showing interest to invest in the sector, Mostafiz said. He further added on the sidelines of the Bangladesh Denim show at International Convention City Bashundhara in Dhaka, the response they are getting from both the local millers and foreigners is huge. A total of 65 exhibitors from 12 countries are participating in the seventh edition of the two-day event. However, he requested the investors not to make new investments in basic denim fabrics as they are already strong in basic denim products. Now what they need is very fine fabrics to produce very high-end denim products. He also said that the prices of fabrics declined in Bangladesh due to the price war among the local fabrics producers. Six months ago, a yard of denim fabrics was sold in Bangladesh at $2.5, which came down to $2 now. As a new hub for denim products, many foreign companies are now coming to open offices or factories in Bangladesh . Landes, a German denim accessories maker, is the latest on the list to start production in its new factory in Savar on November 1. Manfred Slowik, chief operating officer of Landes, at his stall at the expo said that they opened the factory in Bangladesh as they think this is the hub for denim business and there are a lot of business prospects here. The company has already invested $500,000 in the new factory that has 30 employees. By the end of next year, the total workforce in their new plant will be 120 as they are going for new recruitments. Landes has a target to annually produce 500 million pieces of leather patches—an accessory for making denim trousers—at its Savar plant, Slowik said. Such accessories will be supplied to the whole Asian region. All big brands like H&M, VF and Walmart are their customers. Similarly, Nezahat Boni, senior accounts manager of Orta, a Turkish denim maker, said that her company now supplies three million metres of denim fabrics to Bangladesh every year, which was only 800 metres in 2011. They opened an office in Bangladesh in 2011 as they cannot ignore the importance of this country as a denim hub. Md Mujibul Hoque, sales director for Bangladesh at China's Prosperity Textile, said that his company opened an office in Dhaka last year. Hoque's company sells four million yards of denim fabrics a year in Bangladesh and targets to increase the amount to 40 million yards. With the higher demand for denim, Bangladesh has overtaken China to become the largest denim supplier to the European Union – a development that would give confidence to the country's garment sector as it looks to hit $50 billion in exports by 2021. In the January-June period of 2016, Bangladesh exported €567.97 million worth of denim products to the 28-nation bloc with a 21.18 percent market share. While in the last fiscal year, Bangladesh exported denim goods worth $2 billion. Annually 2.1 billion pieces of denim are sold globally and by 2020, the global denim market will reach $64.1 billion, while Bangladesh's denim export is forecasted to reach $7 billion by the end of 2021. Bangladeshi entrepreneurs supply denim products to major global retailers, including Levi's, Diesel, G-Star RAW, H&M, Uniqlo, Tesco, Wrangler, s.Oliver, Hugo Bos, Walmart, and Gap.

Source : Yarns and fibres

Back to top

Pak textile exporters want reduced gas, electricity tariff

Exporters of textile products in Pakistan want the government to reduce the tariff of electricity and gas for them to bring down the cost of business. The demand was conveyed during a recent meeting of the Federal Textile Board chaired by commerce and textile minister Muhammad Pervaiz Malik and Haji Akram Ansari, junior minister for the same portfolios. The meeting was attended by representatives from the All Pakistan Textile Mills Association (APTMA), the Pakistan Readymade Garment Manufacturers and Exporters Association (PRGMEA), the Pakistan Textile Exporters Association (PTEA) and the All Pakistan Textile Processing Mills Association. Malik informed the meeting that the government had allocated Rs 14 billion till now for the implementation of Phase-I of the prime minister’s package of incentives for the textile sector, according to Pakistani media reports. An additional 2 per cent will be allowed for exports to non-traditional markets, like Africa, Latin America, non-EU European countries, Commonwealth of the Independent States and Oceania, the minister said. The textile associations raised issues like withdrawal of tariff rationalisation surcharge, disparity in gas prices across Pakistan, sales tax and customs refunds and extending zero-rating facility to packing material and power looms.

Source: Fibre2fashion.

Back to top

Subscribe to SRTEPC mailing list

Exchange Rates