Union Minister of Commerce & Industry and Civil Aviation chaired a meeting of different exports stakeholders and Commerce Ministry officers to discuss a strategy for revitalizing India's exports and doubling the country's exports by 2025. The Minister said that this is necessary in view of challenges like uncertainty of global trade, rigid approach of banks affecting availability of credit, high logistics cost and productivity standards and qualities. Exports create jobs, bring in foreign exchange and validate India's international competitiveness. Minister of State, C R Chaudhary will be the chairperson of this mission and will regularly review the work of different export promotion councils and divisions of the Ministry of Commerce. The Commerce Minister has already held two meetings with key Ministries for preparing sectoral export strategies which are being finalized. Federation of Indian Export Organisations (FIEO) has done a study identifying 100 billion exports in traditional, new markets and products. EXIM has conducted market research and draft export strategy is being prepared. India had acceded to WTO's TFA (Trade Facilitation Agreement) in April, 2016 and action plan containing specific activities to further ease out the bottlenecks to trade has been prepared. To facilitate transparency through Ease of Doing Business and IT initiatives DGFT and SEZ have been online integrated with customs ICEGATE and mandatory documents required for exports and imports have been reduced to 3 each. Import Export Code (IEC) has been integrated with PAN and MoU signed with GSTN for complete integration. Electronic bank realization certificate (eBRC) system has been shared with 14 State Governments for quick tax refunds and MoU signed with GST Network for integration of e-BRC with GSTN. State Governments have been provided access to DGCI&S export data in real time. Union Cabinet has approved the proposal of Department of Commerce to give focused attention to 12 identified Champion Services Sectors for promoting their development, and realizing their potential. Suresh Prabhu emphasised that special strategy is being prepared for the services sector in order to achieve broad-based growth instead of the existing pre-dominance of IT-ITeS, diversification of services exports across geographical territories, ssensitization of the States to formulate new structures, policies and action plans for services sector and promotion of India as a services hub. The Agricultural Export Policy is in the process of being finalized, after incorporating stakeholders' comments. Commodity and territory specific strategy is also being prepared for items like gems and jewellery, leather, textile & apparel, engineering sector, electronics, chemicals and petrochemicals, pharma, agri and allied products and marine products. Territory specific strategy will cover North American Free Trade Agreement (NAFTA), Europe, North East Asia, ASEAN, South Asia, Latin America, Africa and WANA, Australia, New Zealand, and CIS. The Commerce Minister said that apart from traditional markets India must also look at boosting trade with smaller countries and explore new territories like Africa which has 54 countries but accounts for only 8 % of exports from India. The Minister exhorted exporters to not miss the opportunity presented by China's consumer market and make the most of the world's mega import expo being held in China in November, 2018.
Source: Business Standard
India is now "seeing good momentum in manufacturing. Corporate results for April-June quarter have corroborated the improving demand conditions. India likely grew 7.6 percent in the April-June quarter, propelled in part by an improvement in manufacturing and exports, a Reuters poll showed. The median consensus in a poll of 50 economists put annual economic growth just a touch lower than the near two-year high of 7.7 percent in the January-March quarter. Forecasts for the $2.59 trillion economy ranged between 7.0 and 8.0 percent. The poll results suggest domestic demand was strong, driven primarily by manufacturing activity that remained solid despite elevated oil prices and a weakening Indian rupee. "India is a domestic-driven economy – so a recovery in private consumption can outweigh external headwinds," said Charu Chanana, economist and market strategist at Continuum Economics. In the April-June 2017 quarter, India reported relatively weak annual growth of 5.6 percent, as manufacturing activity contracted. The Indian economy was hit by the November 2016 government decision to withdraw over 80 percent of cash. The transition to a national goods and services tax, effective in July 2017, also impacted the economy. If the median prediction for the April-June quarter proves correct, it was will be the third period in a row with 7 percent or higher growth. India is now "seeing good momentum in manufacturing. Corporate results for April-June quarter have corroborated the improving demand conditions in the economy," said Shubhada Rao, chief economist at Yes Bank. "Corporate earnings data, the PMIs have corroborated the expansion and the recovery story," Rao added. Still, a few economists expect a slight slowdown in growth due to greater global economic uncertainty and domestic political risks from national elections scheduled for May 2019. The Indian government's preferred growth measure, gross value added (GVA), is predicted to have marginally declined to 7.5 percent from 7.6 percent the previous quarter, hampered by weak agriculture growth. India's fiscal deficit widened in the April-June quarter to 68.7 percent of the budgeted target for this fiscal year, a concern but an improvement 80.8 percent for the same period of 2017. This should provide some comfort to the Reserve Bank of India which raised its key rate to 6.5 percent at its Aug. 1policy meeting to try and rein in above-target inflation. The retail inflation rate slowed in July to a four-month low of 4.17 percent, slightly above the central bank's 4 percent medium-term target. The consumer price index has been above-target for nine consecutive months due to higher oil prices and a depreciating rupee. Although the RBI remains concerned about inflation, policymakers there still expect economic growth of 7.4 percent in the current fiscal year, which ends in March 2019.
Source: The Economic Times
MSMEs play a vital role in contributing to our economic growth, with these essential changes, they will prosper. With a contribution of as high as 45 per cent towards the country’s GDP, Micro, Small and Medium Enterprises (MSMEs) have a vital role to play in the Indian economy. The sector has faced many challenges both regarding the economies of scale, the lack of high-end technology and other benefits enjoyed by its larger counterparts. Earlier, at the 28th GST Council meeting, it was pointed out that close to 93% of the total taxpayers filing GST returns, have turnover below Rs 5 crores and their contribution to total GST revenue is less as compared to large companies. This gives scope for Government to look into means for reducing the compliance burden in this sector. This will, in turn, reduce the administration cost incurred and will provide a level-playing opportunity for MSMEs. The principal issues faced by the sector was adapting to the new regime of indirect tax, GST. The online submission of the GST returns has now been made simpler to suit the sector. To further reduce compliance efforts, quarterly SAHAJ and SUGAM returns have been proposed for those with turnover upto Rs 5 crores. Those with turnover upto Rs 1.5crores, will become eligible to opt for composition scheme, the earlier limit was Rs 1 crore. Adding to this, the Income Tax Act was amended in the last fiscal where steps were taken to ease the MSME sectors’ tax burdens; through a change in the threshold of Section 44AD. Businessmen with turnover up to Rs 2 crore could opt for presumptive taxation. Businesses with turnover in excess of Rs 2 crore are mandated to maintain detailed accounting records. Recently, amidst ample curiosity and anticipation, the 29th GST council on the 4th of August converged to address the issues and challenges surrounding the future of Micro, Small and Medium Enterprises. A special committee has been put in place to expedite the addressing of these concerns. With the setting up of this committee, further reforms in input tax credit claim, the limit for registrations, the reverse charge mechanism etc are expected to take place. With these changes, there will be more employment opportunities created in the sector, helping with overall economic growth. The MSME sector has been particularly affected by GST filing due to complexity and newness of the structure of the tax regime. These businesses which were not paying excise duty in the earlier regime are severely impacted. The committee is likely to take up whether such units must be exempted from CGST collection and deposit. This will further relax the load caused to them due to GST. Working capital issues have been one of the top issues. Availability of Input tax credit on time and in an unambiguous manner is very important for this sector as it will affect their working capital cycle. Since these businesses are small, free flow of ITC is critical to keep the working capital in rotation. Delay in filings or compliance by their own suppliers or delay in release of payments from their buyers, have severely impacted their day to day functioning. Delayed GST Refunds is something that has always been a cause of concern for this sector. The government has taken measures to ensure that the pending sanctions are cleared to unclog the working capital plugs that sector is currently witnessing. Ensuring timely refund is of critical importance as the heart of their survival lies in operating with an effective working capital. Another vital discussion was the suggestion for a one-time settlement scheme for legal and litigation issues pertaining to Central Excise and VAT. Implementing this will save resources for MSMEs by unlocking the disputed payments for the government. MSMEs play a vital role in contributing to our economic growth, with these essential changes, they will prosper.
Source: The Economic Times
While the rupee’s depreciation against the dollar in recent times could offer some respite to home textile majors, the near-term outlook for the sector as a whole is far from promising. India's export-oriented home textile companies have been caught amid a myriad of challenges of late. This fact was clearly visible in their weak financial performance in the quarter gone by, as seen in the tables below: While the rupee’s depreciation against the dollar in the recent past could offer some respite to these companies, the near-term outlook for the sector as a whole is far from promising. Here’s why:
Competition
Stiff competition from other home textile exporting nations such as China, Vietnam, Pakistan and Turkey is expected to continue. Barring the yuan, currencies of other countries currently trade at a steep discount to the dollar. The rupee, despite its current weakness vis-a-vis the dollar, is on a much stronger footing versus currencies of most developing nations. Consequently, it can be hard for India's home textile players to compete against foreign counterparts in terms of gaining market share in the US. What adds to Indian companies' woes is the relatively low electricity, labour and fixed overhead costs in competing countries.
Cost inflation
Raw material (cotton) prices have been on an uptrend in India since quite some time, and no price respite may be visible in the foreseeable future. According to the Cotton Association of India, cotton production is likely to decline by 3-4 percent this year to 350 lakh bales. The reduction is attributable to low rainfall in key cotton growing states such as Gujarat (which affects sowing patterns), a decline in acreage, outbreak of pink ballworm infestation on crops, and focus on other cash crops by farmers (especially in Andhra Pradesh, Maharashtra, Karnataka and Punjab).
For home textile majors, passing on such cost hikes to importers is difficult because products, more often than not, are commoditised in nature.
Weak offtake
In the US, which is the biggest market for home textile exports from India, financial position of some offline retailers hasn’t been too encouraging. This is predominantly because of heightened threat from e-commerce players out there, which has forced many brick-and-mortar outlets to shut shop and file for bankruptcy. As a result, demand for home textile products from their end may remain sluggish for quite some time. Contract renegotiations may get trickier for India's home textile majors in view of the ongoing tough market conditions. Established US-based retailers are realigning and restructuring business models by cutting down inventory. Instead of following the erstwhile policy of receiving monthly consignments, they are moving to the weekly orders system, which eventually increases working capital costs of suppliers (ie. India's home textile companies).
Outlook
Leading home textile markets for Indian exporters (primarily North America and Europe) witness strong demand traction in H2 of a fiscal due to the onset of the festive/wedding/holiday season. Hopefully, this will help Indian textile companies offset existing subdued scenario. From a company-specific perspective, a lot would depend on the pace at which utilisation levels at manufacturing centres scale up. This factor, besides being a key indicator of the order book strength and probable demand trajectory, is extremely crucial in terms of aiding margin expansion.
An equally important aspect to look at is how quickly funds invested in capex start translating into cash inflows. Home textile majors, historically, have been investing heavily in building capital assets for a wide variety of purposes.
These include achieving the benefits of backward integration (manufacturing yarn/fabric), increasing existing product manufacturing capacities, adding capacities to manufacture new products, saving power costs, facilitating technological upgradation, undertaking equipment maintenance or a combination of these.
Regional diversification is also the need of the hour given the high degree of dependence of Indian home textile companies on the US market.
Any stock that merits attention?
The undemanding valuations and inability to deliver significant price returns over an extended period of time is indicative of the bearish sentiment harboured by D-street towards home textile majors. Notwithstanding the challenges mentioned above, in our view, Himatsingka Seide appears better placed to tackle industry headwinds compared to its peers and has good fundamentals to back its plans. Himatsingka manufactures bed sheets, pillow covers, fabric (drapery and upholstery variants) and ultra-fine count yarn (constitutes a very nominal percentage of the annual turnover). The company’s retail and distribution arm caters to private labels of major retailers across North America, Europe and Asia. To explore the bath linen space, Himatsingka will commence operations at its 25,000 metric tons per annum terry towel manufacturing factory from Q4 FY19. A gradual increase in efficiency at its expanded 23 million metres per annum (mmpa) bed sheet manufacturing unit, which was commissioned back in H2 FY17, should provide an added impetus to the company’s top-line. An uptick in utilisation rate at Himatsingka’s ultra fine count yarn spinning facility (set up in H2 FY18), coupled with higher contribution of private label and premium brands to overall revenue, will be critical in boosting margins. The company is also involved in talks with new European retailers for export orders. However, interest and depreciation costs are anticipated to be higher in FY19 because of investments directed towards establishing the terry towel unit. GST-induced blockage of funds is another bottleneck that ought to be addressed. Realistically, a noticeable increase in earnings will be seen only starting FY20. The stock, after witnessing a sharp correction of 37.3 percent from its 52-week high, trades at 9.8 times its 2-year forward earnings. Investors may, therefore, consider keeping this on their radar.
Source: Moneycontrol.com
New Delhi: The Reserve Bank expects India's economic growth rate to accelerate to 7.4 per cent in the current financial year on pick up in industrial activity and good monsoon. In its annual report released today, RBI also said that its monetary policy will continue to be guided by the objective of achieving the medium-term target for retail inflation of 4 per cent, within a tolerance band of +/- 2 per cent, while supporting growth. It cautioned that India's external sector will have to confront global headwinds, but expressed confidence that the Current Account Deficit would largely be financed by foreign direct investment. Several experts, including largest lender State Bank of India, expects the CAD to widen this fiscal on account of persistent high oil prices and large trade deficit. The CAD was estimated at 2 per cent of the GDP in fiscal year ending March 2018. The report notes that agricultural production is likely to remain strong, growth impulses in industry are strengthening (propelled by a sustained pick-up in manufacturing and mining activity), corporate are reporting robust sales growth and improvement in profitability, and services sector activity is also set to gather pace. Also, revenue-earning freight traffic of railways has picked up, driven by stepped-up movement in coal, fertiliser and cement. "Over the rest of 2018-19, the acceleration of growth that commenced in 2017-18:H2 is expected to be consolidated and built upon. "Keeping in view the evolving economic conditions, real GDP growth for 2018-19 is expected to increase to 7.4 per cent from 6.7 per cent in the previous year, with risks evenly balanced," said the RBI's Annual Report. The report has maintained the projection regarding GDP growth for the current fiscal as estimated in the third bi-monthly monetary policy of 2018-19 announced earlier this month. Going forward, it said the up-tick in credit growth is likely to be supported by the progress being made under the aegis of the Insolvency and Bankruptcy Code (IBC) in addressing stress on balance sheets of both corporates and banks, recapitalisation of state-owned banks, and a positive outlook on the economy. "The prevailing negative credit-to-GDP gap indicates that there is sufficient scope for credit absorption and expansion in bank lending on a sustained basis," the report said. On inflation which averaged 4.8 per cent during Q1:2018-19, is likely to face upside risks over the rest of the year from a number of sources, warranting continuous vigil and a readiness to head off those pressures from getting generalised, it said. Rising global commodity prices, especially of crude oil, and recent global financial market developments are firming up input cost pressures. The RBI has cautioned that global headwinds are likely to confront India's external sector in 2018-19. Even though exports have gathered momentum in April-June quarter of 2018-19, the worsening global trade environment as a result of "protectionist policies" may impinge upon external demand, it said. Elevated crude oil prices and the strengthening of domestic demand may push up the import bill. As per the report, over the medium-term, the pace and quality of growth will be anchored by progress on the unfinished agenda of structural reforms in -- resolution of banking and corporate financial stress; taxation; agriculture; liberalisation of the economy's external interface, especially with FDI; and galvanising the business environment. "The hard-earned gains of macroeconomic stability that have defined the recent period as its greatest achievement need to be preserved as an imperative within this endeavour," it said. The Central Statistics Office will release the GDP estimate for the April-June quarter (Q1 of 2018-19) on August 31.
Source: ET EnergyWorld
India will not completely halt Iranian oil imports and will finalise its strategy on crude purchases from Tehran after a meeting with top US officials next week, a senior government official said. US Secretary of State Mike Pompeo and Defense Secretary Jim Mattis will hold high-level talks with India's Foreign Minister Sushma Swaraj and Defence Minister Nirmala Sitharaman on Sept. 6, in what is known as a 2+2 dialogue. "Definitely we are not going to zero" (purchases), said the official, who has direct knowledge of India's oil purchase policy and did not wish to be identified. When asked if more clarity on India's Iranian oil purchases would emerge after the dialogue, the official said "yes, that is the highest level of meeting we will have with the US." United States is pushing all countries to halt oil imports from Iran after President Donald Trump withdrew from a 2015 deal between Iran and six world powers and ordered a re-imposition of sanctions on Tehran. India, Iran's top oil buyer after China, has so far not decided on the size of any cut to Iranian imports and continues to seek a waiver from the United States. Trump has threatened that anyone trading with Iran will not do business with America. US sanctions on Iran's energy sector are set to be re-imposed after a 180-day "wind-down period" ending on Nov. 4. Several countries that were involved in the 2015 nuclear deal had attempted to lessen the blow of fresh sanctions on Iran, and urged their firms not to pull out. But that has proven difficult: several European companies have cut ties with Iran, arguing they cannot risk losing their US business as the sanctions deadline approaches. India has already asked its refiners to prepare for a drastic reduction in imports of crude from Tehran from November, sources told Reuters in June. New Delhi has so far not committed to complying fully with the new US sanctions, but is prepared to cut Iran oil imports to protect its wider exposure to the US financial system. During the previous round of sanctions, India was one of the few countries that continued to buy Iranian oil, although it had to reduce imports as shipping, insurance and banking channels were choked off due to the European and US sanctions.
Source: Economic Times
Rupee remained under pressure on Wednesday, as the currency closed at a fresh lifetime low of 70.59 by falling 49 paise against the dollar on robust demand for the American currency. Sustained demand for the dollar from banks and importers, mainly oil refiners, following higher crude oil prices, kept the rupee under pressure. Rushabh Maru, Research Analyst, Anand Rathi Shares and Stock Brokers said, “The rupee depreciated on account of month-end dollar demand from importers. Crude oil prices have also increased in the international market in the last couple of sessions. This has pressurised the rupee. Focus will now shift to India’s GDP and fiscal deficit data due to be released on Friday. Near term range for the rupee is 70.20 and 70.75.” The dollar strengthened on Wednesday as some relief on US-Mexico trade deal gave way to concerns that the conflict over trade between the US and China was not ending soon. A sharp surge in trade deficit too impacted the rupee. Soaring trade deficit is also keeping the local currency on its toes. Meanwhile, domestic equity markets snapped two-day winning run on Wednesday on account of profit booking in index heavyweights including Reliance Industries, HDFC and Infosys. The 30-share Sensex settled 173.70 points, or 0.45 per cent, down at 38,722.93, while the 50-share Nifty pack closed 46.60 points, or 0.40 per cent, down at 11,691.90.
Source: Economic Times
India needs a modified industrial ecosystem in a tech-driven world
Twenty-seven years after the watershed industrial policy of 1991, a new avatar is before the Cabinet for its consideration. This comes as an extension of the ‘Make in India’ programme, which was essentially meant to direct FDI inflows —so far concentrated in a clutch of services sectors such as finance, electronics and telecom — into manufacturing. A draft version of the industrial policy was placed in the public domain a year ago, which rightly identifies core concerns — infrastructure, labour market constraints, slow technology adoption, inadequate R&D spending and fallouts of free trade pacts. The policy aims at creating global brands and raising FDI inflows to $100 billion annually (from $60 billion levels at present). Having moved up several ranks in the ease of doing business index, the idea is to become a key player in the global digital scene. The creation of jobs in a scenario of automation remains an abiding challenge. As an overall strategy, the proposed draft marks a continuation of the process that began in 1991. India has progressively reduced both its trade and financial barriers, which infused the business ecosystem with a new energy. The phased manufacturing programme (PMP), which mandated a level of local sourcing as a condition for exports, was a cornerstone of a liberalised investment regime of the 1990s; it helped in the creation of indigenous capacities in auto and telecom. However, it is important to do some stocktaking. The reforms impetus was two-pronged: first, a reduction in tariffs on capital and intermediate goods was expected to make domestic industry competitive; and, second, FDI flows were expected to improve technology and efficiency levels, besides creating jobs. FDI flows have picked up, but there is little evidence to suggest that these have gone substantially into greenfield investments in manufacturing. Such flows find their way into acquiring domestic facilities, in the process not creating jobs. Similarly, it cannot be said that the gradual withdrawal of tariff protection has lifted efficiency and capabilities as a whole. The pharma sector no longer produces bulk drugs, while technology absorption in hardware and telecom has not taken place. The mismatch between the growth of the software and hardware sectors reflects a policy failure. However, returning to knee-jerk protectionism of the past is no solution. A new system of incentives is needed. Strategic industries should be protected (the Centre needs to identify them) on the condition that R&D spends increase. Unlike the PMP, this will not run foul of the WTO. Taking a leaf out of China, the government should create clusters so that overheads are reduced. Logistics needs a major boost. The Centre could direct resources away from export subsidies into such priorities. A balance between returns on finance and on physical investment needs to be maintained. The draft policy is sketchy in these respects.
Source: Business Line
In the same period last year, India clocked a three-year-low GDP growth rate of 5.7%, majorly due to massive de-stocking ahead of the implementation of the Goods and Services Tax (GST). For the current financial year so far, there are mixed signals on the state of the real economy, said Care Ratings. There is a definite indication of a higher GDP growth in the first quarter of the financial year 2018-19 as compared to the same period last year but the key indicators are likely to display a better picture as they are pitted against a different year which witnessed slowdown due to disruptions caused by the GST before sharp rebound, a report has observed. In the same period last year, India clocked a three-year-low GDP growth rate of 5.7%, majorly due to massive de-stocking ahead of the implementation of the Goods and Services Tax (GST). Rating and financial institutions are expecting the GDP growth rate in the April-June quarter of the current financial year to be between 7.5% to 7.7%. “FY18 was different in terms of the operating environment as GST had caused some degree of upheaval with the growth pattern moving into a trough before rising sharply. This was witnessed in GDP growth as well as industrial growth which in turn will tend to display a better picture this year,” a report by Care Ratings said. “For the current financial year so far, there are mixed signals on the state of the real economy,” the report said. While praising the performance of FDI inflows and better trade numbers, Care Ratings expressed worry over indications of unclear employment scenario, strained agriculture, and lower investments. “The employment scenario appears unclear given the different contrary indications given by the EPFO and CMIE data,” the report said. On investments, it said that while the picture on domestic investment intentions is still a bit nebulous, the FDI flows have been more positive and definite with growth of 22% in the first quarter from $10.4 billion to $12.7 billion.
Source: Financial Express
Frauds related to non-payment of dues of about Rs 1,000 crore are hurting the local textile market, say market leaders. These relate to bouncing of cheques, misuse of GST numbers, deliberate non-payment and even extension of payment cycles to about six months. However, Maskati Market Kapad Mahajan, which arbitrates in trade disputes, said that most of the cases do not come on record and so culprits are mostly not identified resulting in repetition of frauds. Gaurang Bhagat, president of Maskati Market Kapad Mahajan, said that cases of cheques not being honoured have been rampant over the past two and a half years resulting in accumulated frauds worth Rs 1,000 crore. "These estimates were arrived at when traders began opening up. Despite the Mahajan intervening to solve disputes, only about one per cent of cases come on record and the count of victims continue to rise," said Bhagat. The owner of a processing firm in Ahmedabad said that it had supplied goods worth Rs 12.5 lakh to a firm about two months ago but the buyer is unwilling to pay. He has registered his complaint with the Mahajan. "The buyer came with the reference of a reputed trader and paid for goods worth Rs 2.5 lakh. After that he bought goods worth Rs 7.5 lakh and Rs 5 lakh in quick succession and is now not honouring the commitment," said the businessman. Bhagat said that despite being duped, sellers give reference of buyers in the hope that the latter will pay back, but in the process, other traders get duped too. Bhagat warned sellers to supply goods to unauthenticated buyers coming through the reference of other traders. "If the sellers want to know the credentials of any buyer, they should approach the Mahajan. We will give the right guidance," he said. The segment of salwaar-kameez and kurtis is the worst affected with estimated frauds worth at least Rs 500 crore. "Close to 2,000 traders in the sector have been at the receiving end. The frauds in denim, shirting, cotton suiting, other dress material and bed sheets are not that rampant," said Bhagat.
OVER 400 COMPLAINTS RECEIVED IN 18 MONTHS
Maskati Mahajan, as it is popularly called, received over 400 disputes in past 18 months, of which 125 are still pending. Bhagat said that another 800 cases have been settled in an informal manner. The Mahajan has got the authority to arbitrate in disputes between traders. It has blacklisted over 100 traders and has urged traders to bring on record the fraud cases so more fraudulent traders can be identified. Traditionally, textile trading is on credit, with credit cycle being 15-60 days. Even if there is a delay in payment, traders hope that payment will be made and do not register a formal complaint. Bhagat said that in spite of the fact that Goods and Services Tax (GST) has brought formalisation in trade, such frauds continue. "There are numerous cases of misuse of GST number, with the rightful owner not even aware of the misuse," he informed.
Source: DNA
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1644.61 |
USD/Ton |
0.45% |
8/29/2018 |
|
VSF |
2151.21 |
USD/Ton |
0.69% |
8/29/2018 |
|
ASF |
3054.27 |
USD/Ton |
0% |
8/29/2018 |
|
Polyester POY |
1732.71 |
USD/Ton |
0.85% |
8/29/2018 |
|
Nylon FDY |
3436.06 |
USD/Ton |
0.43% |
8/29/2018 |
|
40D Spandex |
5065.98 |
USD/Ton |
0% |
8/29/2018 |
|
Nylon POY |
3568.21 |
USD/Ton |
0% |
8/29/2018 |
|
Acrylic Top 3D |
5543.21 |
USD/Ton |
0% |
8/29/2018 |
|
Polyester FDY |
1945.63 |
USD/Ton |
1.15% |
8/29/2018 |
|
Nylon DTY |
3142.38 |
USD/Ton |
0% |
8/29/2018 |
|
Viscose Long Filament |
3230.48 |
USD/Ton |
0% |
8/29/2018 |
|
Polyester DTY |
1938.29 |
USD/Ton |
1.15% |
8/29/2018 |
|
30S Spun Rayon Yarn |
2789.96 |
USD/Ton |
0% |
8/29/2018 |
|
32S Polyester Yarn |
2386.15 |
USD/Ton |
0% |
8/29/2018 |
|
45S T/C Yarn |
3054.27 |
USD/Ton |
0% |
8/29/2018 |
|
40S Rayon Yarn |
2555.02 |
USD/Ton |
0% |
8/29/2018 |
|
T/R Yarn 65/35 32S |
2599.07 |
USD/Ton |
0% |
8/29/2018 |
|
45S Polyester Yarn |
2951.48 |
USD/Ton |
0% |
8/29/2018 |
|
T/C Yarn 65/35 32S |
2555.02 |
USD/Ton |
0% |
8/29/2018 |
|
10S Denim Fabric |
1.37 |
USD/Meter |
0% |
8/29/2018 |
|
32S Twill Fabric |
0.84 |
USD/Meter |
0% |
8/29/2018 |
|
40S Combed Poplin |
1.18 |
USD/Meter |
0% |
8/29/2018 |
|
30S Rayon Fabric |
0.66 |
USD/Meter |
0.44% |
8/29/2018 |
|
45S T/C Fabric |
0.71 |
USD/Meter |
0.21% |
8/29/2018 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.14684 USD dtd. 29/8/2018). The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
Textile export numbers for the month of Jul-19 have disappointed to say the least. The provisional numbers released by the Pakistan Bureau of Statistics (PBS) show negligible growth on a year-on-year basis in the first month of the new fiscal year. And when compared to textile exports for Jun-18, the number has actually fallen by almost 16 percent on a month-on-month basis. So what will it take to revive the slumbering sector? Depreciation of the rupee was a major demand of textile players. However, despite more than 18 percent being wiped off the rupee value, the rebound hasn’t exactly happened. But industry stakeholders argue that the coming months will show better performance by the sector and claim many exporters realised a high number of orders in the final month of the last fiscal year i.e. Jun-18 to avail incentives earlier. It is not yet clear how the PTI government will manage to revive the sector. Unarguably, rising cost of production is a bane for manufacturers and exporters. But given the precarious twin deficit situation, it will not be a simple task to just reduce the utility tariffs for the industry. In its textile policy, PTI has called for electricity prices to be revised downward to USc7.5/KWh. Similarly, it also proposes for a uniform gas rate across the country at rate of $6.5/MMBTU. Then there is the raw material procurement which has become tedious and costly. This newspaper has highlighted the illogical protection afforded to polyester players and the even more stupefying re-imposition of duty on imported cotton. The area under cultivation of local cotton has gone down and the cotton production target was missed by 8 percent in FY18 while by an even wider margin of 30 percent and 25 percent in FY16 and FY17 respectively. The current year is likely to be no different when it comes to a shortfall of the required 16-17million bales by the local industry. These issues aside, the private sector also needed to make a concerted effort to bring the level of productivity and innovation on par with international peers. Barring the major players, the industry has seen hardly any balancing, modernisation and replacement (BMR) activities in the past decade. Innovation has also been missing with experimentation with new fabric varieties far and few in between.
Source: Business Recorder
U.S. Trade Representative Robert Lighthizer, left, and Mexican Secretary of Economy Idelfonso Guajardo, right, walk into the White House on Monday before the announcement of a U.S.-Mexico trade deal. (Luis Alonso Lugo/Associated Press) While the trade deal U.S. President Donald Trump's administration struck with Mexico has the potential to set the stage for the final phase of NAFTA negotiations, many of the details have yet to be fully revealed, leaving industry players cautious in their reaction to the news. For some, there are visible potential benefits, while for others the uncertainty and lack of detail have raised concerns that their industry may still be under threat. The automobile industry in Canada, for instance, appears to be broadly supportive of the deal, calling it progress toward a new North American Free Trade Agreement. "I think it's a good start. Ultimately one of the biggest problems, of course, was the low wages in Mexico and so this is, I think, a positive start," said Jerry Dias, the head of Unifor, Canada's largest private sector union, which includes auto workers. The deal, as announced, would require 40-45 per cent of auto content made in Mexico to be made by workers earning at least $16 US per hour, placating unions in Canada and the U.S. concerned about high-paying jobs moving to Mexico's low-wage economy. "I also see the increase of the rules of origin to 75 per cent as a positive first step, we proposed that," Dias said, suggesting increasing the threshold could prompt more automotive parts to be made in Canada, benefiting workers here. The revised U.S.-Mexico deal will require 75 per cent of auto content to be made in North America, up from 62.5 per cent under the current NAFTA deal. But Flavio Volpe, president of Canada's Automotive Parts Manufacturers' Association, said that despite the increase to the rules of origin threshold, some companies may simply continue to buy parts from abroad and just eat the 2.5 per cent tariff. Still, he called the deal "progress." The Canadian Automobile Dealers Association also welcomed the news of the deal and said in a statement that all parties should now work toward "a final trilateral agreement as soon as possible."
The textile industry
The textile industry, however, said it has concerns with what it has heard about the deal so far, specifically the potential that sewing thread, pocket fabric, elastic bands and coated fabric would also have to meet North American rules of origin. According to the Canadian Apparel Federation, at present, if yarn used to make a textile was made in North America, the textile that yarn was turned into was made in North America and the finished article of clothing itself was made in North America, then the garment could be sold into the U.S. and Mexico tariff free. But under this new agreement, the industry fears that other components, including thread, the linings of pockets and elastic bands sewn into the garments, will also have to be made in North America for the garment to escape tariffs. "They are putting all sorts of extra requirements, requirements that are just extraordinary," said Bob Kirke, executive director of the Canadian Apparel Federation. "It's ridiculous, it's going to disqualify the only sewing thread supplier in Canada, and I am not in favour of that." "NAFTA wasn't broken and now they are fixing it, and they are fixing it in a way that will break it, or at least make it harder to trade," Kirke said. The president of Cansew, a Canadian sewing thread supplier whose products are made both here and abroad, said the announcement has left his industry on uncertain ground. "We know it is a concern but we do not know what the outcome will be. We have expressed our misgivings to the association but where it will end up we don't know," said Hershie Schachter.
Fruit and vegetables
Ron Bonnett, president of the Canadian Federation of Agriculture, said noted that other issues, such as dispute settlement, remain unresolved. He said while the announcement of U.S.-Mexico deal may make a splash, he is still waiting to see what it will mean for agriculture in Canada. The Canadian Produce Marketing Association, however, said it was encouraged by the agreement and by outgoing Mexican President Enrique Peña Nieto's reference to including Canada in future discussions. "It is our understanding that the seasonality provision has been removed from the U.S.-Mexico agreement and will not be part of the discussions moving forward," the CPMA said in a statement. "The CPMA has long advocated for the removal of the seasonality provision and is pleased that it will not be a feature of a future trilateral agreement." That provision would have allowed U.S. growers to request an anti-dumping investigation against Mexican producers based on only one season's worth of data, rather than looking at the total shipments of produce over longer time frames.
Source: CBC News
Local fashion designers showcased their collections at "Rev Up Chicago: Moving Fashion Forward," a fundraiser Aug. 22 at Bentley Gold Coast. Hosted by and benefiting the Apparel Industry Foundation, the event attracted over 150 guests, honored Pat and Joe Perillo, and featured an exciting runway show and an award and scholarship presentation. During a reception, guests mingled in the Gold Coast dealership amid pricey Bentleys, Lamborghinis, Rolls-Royces and Maseratis. Produced by Susan Glick, the 25-minute fashion show included looks created by established designers Caroline Rose, Heidi Hess, Lauren Lein Ltd., Maria Pinto M2057, Mira Couture, ARMigami and Ricorso, and emerging designers Brandon Blackshear, Model Atelier, Rebellion and Varyform. The runway production, emceed by local fashion expert Erica Strama, showcased a variety of chic designs and accessories from casual to formalwear. Blackshear presented his first collection and took inspiration from classic American sportswear, sending models down the runway in finely tailored activewear. Rebellion designer Stephanie Wheat's specialty was brightly colored leather and fur handbags, and Robin Harris (Model Atelier) focused her designs on "tall, strong, confident women." Lein's collection was themed "Make America Beautiful" and featured models in flirty, feminine dresses and whimsical hats. Mira Couture closed the show with models gliding down the runway in dazzling eveningwear. Marsha Brenner, who has served as the Apparel Industry Foundation and the Apparel Industry Board's executive director for more than 20 years, spoke about the most rewarding part of her job. "For me, when I see a youngster do well and become something, my heart melts. Take for instance ARMigami's designers Joan Pavalon and Jocelyn Weinzimmer. They came to me with a crazy idea for a shawl that you can wear multiple ways, and I told them to go for it. They're now doing really well and are appearing on QVC," she said. Brenner introduced Stanley Paul, who has been involved with the organization since 1990. He presented a $5,000 tuition scholarship award to up-and-coming designer Jennifer Hanna (Harper College) through his Stanley Paul/Raelene Mittelman Fashion Design Scholarship Fund, which was founded in memory of his late sister Raelene. Paul's foundation awards scholarships annually to students from Chicago and/or Illinois who are enrolled in a Chicago area college that has a fashion design program. To date, the foundation has awarded more than $300,000 to students. Other scholarship finalists featured in the show were Maria Angjelli (Dominican University), Bionca Cummins (Illinois Institute of Art in Chicago), Temuulen Dashdondog (College of DuPage) and Judith Lopez (Harper College). Cummins, who presented her Medieval Nightlife collection in her first industry show, was enthusiastic about the support she's received from the organization. "I did my internship at (the Apparel Industry Board Inc.) and learned so much from them — fabric manipulation, pattern design and so much more. … In places like New York, fashion is really at the forefront, but we don't have that in Chicago. Even though we're the heart of America, fashion can get lost here, but AIBI helps us keep our ideas of fashion alive and our voices heard." Joe Perillo Jr. and his sister Trish Inguagiato introduced their parents, the evening's honorees. "They have always given their hearts and souls to everybody unconditionally and are true role models and an inspiration to all of us," said Inguagiato. The Perillos were joined onstage by their grandchildren Elianna and Joe Joe as they accepted a custom portrait by popular local artist Rosemary Fanti, and a crystal star award. Ald. Tom Tunney, 44th, spoke about the organization's impact in the community. "We want to reaffirm the city's commitment to jobs in the apparel industry and the Apparel Mart. We're going to work with the city's budget process to make sure that we sustain this relationship because this industry is an integral part of jobs and our economic development have to maintain this industry and Chicago as a fashion capital of the country," he said. For more than 30 years, the Apparel Industry Foundation and its board have been resources for emerging and established designers in the greater Chicago area, providing them with mentorship, a hotline for jobs, fashion business seminars, shared manufacturing space and classes in pattern-making, business counseling, technical design and more. Freelance writer Candace Jordan is involved in many local organizations, including some whose events she covers.
Source: Chicago Tribune
The impact of Brexit, the change in consumer demand for clothing and the slowdown in high street sales in the United Kingdom are among the factors that are affecting sourcing of both textiles and garments there, according to Linda Laderman, co-founder and organiser of Textile Forum, London's premiere sourcing event for luxury fashion fabrics. The event, which attracts fabric buyers from major fashion retailers and brands, established independent design businesses and start-ups, tailors, craft shops, seamstresses and costumiers, has witnessed an increase in exhibitors from Italy, Spain and India in recent times, Laderman told Fibre2Fashion in an interview. (DS)
Source: Fibre2Fashion
Used clothes imported from the US and other developed countries are believed to pose a challenge to Africa's clothing industries. While some countries in the eastern African region are resisting the pressure to continue the practice in a bid to protect their textile industries, local textile manufacturers continue to struggle with issues of smuggling, poor patronage and low purchasing power while capacity for apparel production remains low. FEMI ADEKOYA and GRACIOUS AKUNNA write on the sector's unlikely competition. For many micro and small businesses who deal in clothing and apparels, second-hand clothes from many developed countries dominate their stalls, except in cases where cheaper materials are imported from Asia or sub-standard materials smuggled from neighbouring countries. Bend down select or Okrika as they are popularly known in Lagos, Nigeria form the mainstay of informal traders, accounting for a high volume of clothing sales with the exception of unsewn fabrics. With consumers' purchasing power declining by the day, second-hand clothes have become attractive to the low-income gap group who believe that such clothes, though affordable in some cases, have higher quality than the new sewn fabrics often imported from China and produced in the eastern part of the country with foreign designers' labels. Overwhelmed by challenges of smuggling, power challenges, access to credit among others, the main stay for local manufacturers has been the cultural practice of procurement of local fabrics for ceremonies and sometimes institutions that make use of uniform wears. Nigeria was hitherto ranked the second largest textile hub in Sub-Saharan Africa queuing behind South Africa, representing 63 percent of the textile capacity in the West African sub-region before the neglect and policy inconsistencies that capsized the sector. Figures showed that the number of textile and garment factories after the storm, fell from 175 in the mid 1990's to less than 25 in 2010 while employment dropped from 137,000 in the 1990's to 60,000 in 2002 and further to 24,000 in 2010. The number has since continued to be on a decline. As a consequence, this led to the decline in cotton lint production from 98,000 in 2006 to 55,000 tons in 2010 and export of cotton went down from $44 million to $31 million within the same period. The National Bureau of Statistics puts the value of the nation's trade cotton lint for the first quarter of 2018 at N139.15 million.
Stakeholders explain perspective
Considering Nigeria's poverty index, trade in second-hand clothes may seem economically justifiable, but many eastern African nations are beginning to look beyond the effect of such practice on their domestic textile industries to issues of dignity preservation. Director General, Nigerian Textile Manufacturers' Association (NTMA), Hamma Kwajaffa in chat with The Guardian, explained that the second-hand clothes are not seen as threats but activities of smugglers who imitate local brands and also sell below production costs of local producers. "In our own case, we largely produce fabrics and are only contesting with the smugglers of our own fabric that come in through the borders, find their ways into our markets, compete with our products and sell it lower and cheaper prices to the detriment of our production. "In this aspect, we are not winning because they are selling cheaper and consumers don't worry. For consumers, their concern is that once the product is okay for them, they go ahead and buy them. For us, we are unable to meet up with the kind of price competing brands offer because of high cost of production. "What we want is for government to implement the executive order that mandates ministries to buy made in Nigeria directly from the manufacturers. This order is presently being ignored, especially by agencies that need fabric for their uniforms. The Ministries of Defence and Interior are not complying with the directive. They keep importing their uniforms from China. "We are not competing with second hand clothing at all. Once second hand clothes are sterilized, there will be no problem with used clothing because they are cheaper and okay", he added. Kwajaffa however acknowledged the vacuum second-hand clothing fill in terms of mass production of various sizes and bespoke designs which often times are expensive when produced based on individual demand. Data from the Manufacturers Association of Nigeria (MAN) for the second half of 2017 showed that production in Textile, Wearing Apparel, Carpet, Leather and Leather products sectoral group increased to N25.03 billion while the value of production in the sector totalled N48.21 billion in 2017.
Why consumer prefer second-hand clothes
Some of the consumers affirmed the desire for new clothing but constrained by paucity of funds while also acknowledging the quality preference in procuring used clothes. Oufunjumba Ruth told The Guardian that if she had money, she would prefer to buy new clothes, adding that second hand clothe is 'cheap and strong'. "Nigerian clothes are not as good as second hand clothes, because once you wear them and wash once, the colour fades. "I do not feel somehow wearing second hand clothe because I bought it with my money, and if I don't tell you it is second hand clothe how would you know?" she asked. Obasa Precious said: "I prefer Okrika, because it has quality than new one. I save money and cost from buying new cloth by buying used one, and still if I wear it nobody will know it is used. Especially for my children who play around, new cloths are a waste of money; they need play wears so I buy used clothes for them. It is not like I don't like Nigerian-made clothes or fabric, the expenses are much. The money I will use to buy material to sew is enough for me to buy 10 clothes if not more that in okrika. And again most of the Nigeria-made clothe doesn't last". Ogunfeso Tolani said: "I prefer new clothe. I cannot afford to wear what has been worn by someone else. I don't know what possesses that person or even what that clothe has been used for before been sold".Qudirat Opeyemi has no preference as long as the cloth looks good on her. She said: "I can buy anyone both used and new. I pick anyone because any clothe I see that is nice I don't mind if it is new or second hand. I buy anyone that I like as long as it looks good on me. I don't mind the whereabouts of the cloth as far as it is nice and good to wear".Ernest Chinedu prefers buying new clothes because of the value and quality tagged to it. "I buy new clothes to keep up with the latest trends and honour special occasions, he said. Although many garment manufacturers are taking advantage of the African Growth and Opportunity Act (AGOA), which allows duty-free access to the U.S. market for more than 6,500 products, to gain access to the global markets, there are opportunities waiting to be harnessed in the mass market that seeks quality ready-made clothes in various sizes at cheaper prices.
Source:AllAfrica.com
Investing in logistics and applying lean management are considered two of the solutions to optimise the supply chain, helping domestic garment and textile firms to solve the issues related to warehousing operations to save costs and increase competitive capacity. The concept of global supply chains is not unfamiliar to import and export enterprises in the context of the Vietnamese economy becoming a market economy and international integration during the past 30 years. However, most Vietnamese enterprises, especially garment and textile firms, only participate in secondary supply chains with low added-value. According to Nguyen Van Nam, director of the Research Institute for Brand and Competition Strategy, the outstanding disadvantages of the Vietnamese supply chain are its backwardness and lack of consistency. At present, only 21 per cent of small- and medium-sized enterprises are part of the global supply chain, while the figure is 30 per cent in Thailand and 46 per cent in Malaysia. The logistics expenses of domestic enterprises is double or triple of those in a number of countries with similar economic conditions to Vietnam. The expanded costs on logistics have hugely affected the segments of garment and textile, footwear, and electronics that employ a large number of labourers and run huge exports and imports, are hugely dependent on input, and have produce low added value. According to Vietnam Textile and Apparel Association (Vitas), as of the end of 2016, logistics costs accounted for one-third of selling prices. To resolve the issue, many firms apply technology to better manage warehousing as well as optimise their supply chains. Accordingly, commonly used technologies are backing up the bills and contracts, and automatically transferring documents between firms. Pham Kien Cuong, business development vice manager at Vinafco JSC, a logistics firm established in 1987, said that applying technologies to the supply chain will save 5 per cent of the firm’s costs, expenses will be narrowed to 0 per cent, and personnel will be reduced by 25-30 per cent. However, Cuong also told VIR that despite the huge advantages, the number of garment and textile firms applying technology to their supply chains is very small. “Garment and textile products are quite simple and easy to manage, which is different from electronic products that require high accuracy. Therefore, garment and textile companies rarely invest in their management systems and only focus on buyers,” Cuong explained. “Garment and textile firms will receive huge benefits from applying technology to their whole logistic systems. However, only applying technology to warehouse management do not help them save costs.” Cuong added. Along with the investment in logistics, applying the lean management model is another optimal solution to optimise the supply chain. According to Nguyen Dang Minh, chairman of the Advisory Board of GKM Lean Institute (GKM Vietnam Co., Ltd.), at present, 15 per cent of garment and textile firms apply lean management models in their operation and started to reap the sweet fruits, including Garment 10 JSC and Hung Yen Garment Corporation. However, if they only apply mechanically lean management models from other countries without making changes to suit the Vietnamese environment, they will only be able to exploit 70 per cent the method’s value. Minh added that the “Made in Vietnam” lean management model developed by Vietnamese people suits all industries in Vietnam, including the garment and textile industry, which employ a massive number of people, because this model focuses on changing people’s mindset. By the way, the model revolves around gaining profit or creating added values for the company by utilising the employees’ intellect to continuously improve the business process and minimise costs. In order to increase profit, firms have to keep constant revenue flows or accelerate the company’s income gradually, while at the same time reducing and eliminating waste as much as possible. However, the model is just one solution, the important thing is to shift the mindsets of company leaders and employees, which requires huge commitment and determination.
Source: VietNamNetBridge
TASHKENT (TCA) — The Uzbekipaksanoat (Uzbek Silk Industry) Association and the Italian Silk Association have agreed on the establishment of an Italian industrial park in Uzbekistan, the Jahon information agency reported. The park will house companies specializing in the processing of cocoons, the manufacture of silk products, as well as equipment and necessary components. The parties have already agreed on the creation of the first joint venture to produce finished goods from silk. The emergence of the park, according to experts, will increase the export of silk products to the European Union, as well as enter new markets in European countries. In addition, the association is negotiating with Turkish textile companies to produce new goods – silk carpets and the painting of silk fabrics. Within the framework of the program of measures on integrated development of the silk industry until 2021, approved by the Uzbek government, about 30 mills for the processing of cocoons are currently being modernized in the country. Also, work is underway to organize 11 new specialized enterprises for deep processing of silkworm cocoons worth $83.2 million, most of which are planned to be commissioned this year. As part of the modernization, agreements were signed for the purchase of new equipment from such well-known companies as Van De Wiele, Picanol and Reggiani. As a result, it is planned to double the production of raw silk in three years and increase the figure to 3 thousand tons per year, and also through the deep processing of raw materials to increase the production of silk fabrics eightfold, reaching 11.2 million linear meters per year. Back in 2016, the extent of the use of production capacities of silk-processing enterprises in Uzbekistan was only 17%, and in 2017 it reached 54%. In 2016, products for $20.9 million were exported, and last year the figure reached $37.7 million. Today, Uzbek enterprises produce four types of goods: raw silk, silk wool, silk fabric and finished silk products, while last year the manufacturing process was concentrated on raw silk alone. By 2021, it is planned to establish production and export of at least five types of silk goods.
Source: The Times of Central Asia
The impact of Brexit, the change in consumer demand for clothing and the slowdown in high street sales in the United Kingdom are among the factors that are affecting sourcing of both textiles and garments there, according to Linda Laderman, co-founder and organiser of Textile Forum, London's premiere sourcing event for luxury fashion fabrics. The event, which attracts fabric buyers from major fashion retailers and brands, established independent design businesses and start-ups, tailors, craft shops, seamstresses and costumiers, has witnessed an increase in exhibitors from Italy, Spain and India in recent times, Laderman told Fibre2Fashion in an interview. (DS)
Source: Fibre2Fashion
Used clothes imported from the US and other developed countries are believed to pose a challenge to Africa's clothing industries. While some countries in the eastern African region are resisting the pressure to continue the practice in a bid to protect their textile industries, local textile manufacturers continue to struggle with issues of smuggling, poor patronage and low purchasing power while capacity for apparel production remains low. FEMI ADEKOYA and GRACIOUS AKUNNA write on the sector's unlikely competition. For many micro and small businesses who deal in clothing and apparels, second-hand clothes from many developed countries dominate their stalls, except in cases where cheaper materials are imported from Asia or sub-standard materials smuggled from neighbouring countries. Bend down select or Okrika as they are popularly known in Lagos, Nigeria form the mainstay of informal traders, accounting for a high volume of clothing sales with the exception of unsewn fabrics. With consumers' purchasing power declining by the day, second-hand clothes have become attractive to the low-income gap group who believe that such clothes, though affordable in some cases, have higher quality than the new sewn fabrics often imported from China and produced in the eastern part of the country with foreign designers' labels. Overwhelmed by challenges of smuggling, power challenges, access to credit among others, the main stay for local manufacturers has been the cultural practice of procurement of local fabrics for ceremonies and sometimes institutions that make use of uniform wears. Nigeria was hitherto ranked the second largest textile hub in Sub-Saharan Africa queuing behind South Africa, representing 63 percent of the textile capacity in the West African sub-region before the neglect and policy inconsistencies that capsized the sector. Figures showed that the number of textile and garment factories after the storm, fell from 175 in the mid 1990's to less than 25 in 2010 while employment dropped from 137,000 in the 1990's to 60,000 in 2002 and further to 24,000 in 2010. The number has since continued to be on a decline. As a consequence, this led to the decline in cotton lint production from 98,000 in 2006 to 55,000 tons in 2010 and export of cotton went down from $44 million to $31 million within the same period. The National Bureau of Statistics puts the value of the nation's trade cotton lint for the first quarter of 2018 at N139.15 million.
Stakeholders explain perspective
Considering Nigeria's poverty index, trade in second-hand clothes may seem economically justifiable, but many eastern African nations are beginning to look beyond the effect of such practice on their domestic textile industries to issues of dignity preservation. Director General, Nigerian Textile Manufacturers' Association (NTMA), Hamma Kwajaffa in chat with The Guardian, explained that the second-hand clothes are not seen as threats but activities of smugglers who imitate local brands and also sell below production costs of local producers. "In our own case, we largely produce fabrics and are only contesting with the smugglers of our own fabric that come in through the borders, find their ways into our markets, compete with our products and sell it lower and cheaper prices to the detriment of our production. "In this aspect, we are not winning because they are selling cheaper and consumers don't worry. For consumers, their concern is that once the product is okay for them, they go ahead and buy them. For us, we are unable to meet up with the kind of price competing brands offer because of high cost of production. "What we want is for government to implement the executive order that mandates ministries to buy made in Nigeria directly from the manufacturers. This order is presently being ignored, especially by agencies that need fabric for their uniforms. The Ministries of Defence and Interior are not complying with the directive. They keep importing their uniforms from China. "We are not competing with second hand clothing at all. Once second hand clothes are sterilized, there will be no problem with used clothing because they are cheaper and okay", he added. Kwajaffa however acknowledged the vacuum second-hand clothing fill in terms of mass production of various sizes and bespoke designs which often times are expensive when produced based on individual demand. Data from the Manufacturers Association of Nigeria (MAN) for the second half of 2017 showed that production in Textile, Wearing Apparel, Carpet, Leather and Leather products sectoral group increased to N25.03 billion while the value of production in the sector totalled N48.21 billion in 2017.
Why consumer prefer second-hand clothes
Some of the consumers affirmed the desire for new clothing but constrained by paucity of funds while also acknowledging the quality preference in procuring used clothes. Oufunjumba Ruth told The Guardian that if she had money, she would prefer to buy new clothes, adding that second hand clothe is 'cheap and strong'. "Nigerian clothes are not as good as second hand clothes, because once you wear them and wash once, the colour fades. "I do not feel somehow wearing second hand clothe because I bought it with my money, and if I don't tell you it is second hand clothe how would you know?" she asked. Obasa Precious said: "I prefer Okrika, because it has quality than new one. I save money and cost from buying new cloth by buying used one, and still if I wear it nobody will know it is used. Especially for my children who play around, new cloths are a waste of money; they need play wears so I buy used clothes for them. It is not like I don't like Nigerian-made clothes or fabric, the expenses are much. The money I will use to buy material to sew is enough for me to buy 10 clothes if not more that in okrika. And again most of the Nigeria-made clothe doesn't last". Ogunfeso Tolani said: "I prefer new clothe. I cannot afford to wear what has been worn by someone else. I don't know what possesses that person or even what that clothe has been used for before been sold".Qudirat Opeyemi has no preference as long as the cloth looks good on her. She said: "I can buy anyone both used and new. I pick anyone because any clothe I see that is nice I don't mind if it is new or second hand. I buy anyone that I like as long as it looks good on me. I don't mind the whereabouts of the cloth as far as it is nice and good to wear".Ernest Chinedu prefers buying new clothes because of the value and quality tagged to it. "I buy new clothes to keep up with the latest trends and honour special occasions, he said. Although many garment manufacturers are taking advantage of the African Growth and Opportunity Act (AGOA), which allows duty-free access to the U.S. market for more than 6,500 products, to gain access to the global markets, there are opportunities waiting to be harnessed in the mass market that seeks quality ready-made clothes in various sizes at cheaper prices.
Source:AllAfrica.com
Investing in logistics and applying lean management are considered two of the solutions to optimise the supply chain, helping domestic garment and textile firms to solve the issues related to warehousing operations to save costs and increase competitive capacity. The concept of global supply chains is not unfamiliar to import and export enterprises in the context of the Vietnamese economy becoming a market economy and international integration during the past 30 years. However, most Vietnamese enterprises, especially garment and textile firms, only participate in secondary supply chains with low added-value. According to Nguyen Van Nam, director of the Research Institute for Brand and Competition Strategy, the outstanding disadvantages of the Vietnamese supply chain are its backwardness and lack of consistency. At present, only 21 per cent of small- and medium-sized enterprises are part of the global supply chain, while the figure is 30 per cent in Thailand and 46 per cent in Malaysia. The logistics expenses of domestic enterprises is double or triple of those in a number of countries with similar economic conditions to Vietnam. The expanded costs on logistics have hugely affected the segments of garment and textile, footwear, and electronics that employ a large number of labourers and run huge exports and imports, are hugely dependent on input, and have produce low added value. According to Vietnam Textile and Apparel Association (Vitas), as of the end of 2016, logistics costs accounted for one-third of selling prices. To resolve the issue, many firms apply technology to better manage warehousing as well as optimise their supply chains. Accordingly, commonly used technologies are backing up the bills and contracts, and automatically transferring documents between firms. Pham Kien Cuong, business development vice manager at Vinafco JSC, a logistics firm established in 1987, said that applying technologies to the supply chain will save 5 per cent of the firm’s costs, expenses will be narrowed to 0 per cent, and personnel will be reduced by 25-30 per cent. However, Cuong also told VIR that despite the huge advantages, the number of garment and textile firms applying technology to their supply chains is very small. “Garment and textile products are quite simple and easy to manage, which is different from electronic products that require high accuracy. Therefore, garment and textile companies rarely invest in their management systems and only focus on buyers,” Cuong explained. “Garment and textile firms will receive huge benefits from applying technology to their whole logistic systems. However, only applying technology to warehouse management do not help them save costs.” Cuong added. Along with the investment in logistics, applying the lean management model is another optimal solution to optimise the supply chain. According to Nguyen Dang Minh, chairman of the Advisory Board of GKM Lean Institute (GKM Vietnam Co., Ltd.), at present, 15 per cent of garment and textile firms apply lean management models in their operation and started to reap the sweet fruits, including Garment 10 JSC and Hung Yen Garment Corporation. However, if they only apply mechanically lean management models from other countries without making changes to suit the Vietnamese environment, they will only be able to exploit 70 per cent the method’s value. Minh added that the “Made in Vietnam” lean management model developed by Vietnamese people suits all industries in Vietnam, including the garment and textile industry, which employ a massive number of people, because this model focuses on changing people’s mindset. By the way, the model revolves around gaining profit or creating added values for the company by utilising the employees’ intellect to continuously improve the business process and minimise costs. In order to increase profit, firms have to keep constant revenue flows or accelerate the company’s income gradually, while at the same time reducing and eliminating waste as much as possible. However, the model is just one solution, the important thing is to shift the mindsets of company leaders and employees, which requires huge commitment and determination.
Source: VietNamNetBridge
TASHKENT (TCA) — The Uzbekipaksanoat (Uzbek Silk Industry) Association and the Italian Silk Association have agreed on the establishment of an Italian industrial park in Uzbekistan, the Jahon information agency reported. The park will house companies specializing in the processing of cocoons, the manufacture of silk products, as well as equipment and necessary components. The parties have already agreed on the creation of the first joint venture to produce finished goods from silk. The emergence of the park, according to experts, will increase the export of silk products to the European Union, as well as enter new markets in European countries. In addition, the association is negotiating with Turkish textile companies to produce new goods – silk carpets and the painting of silk fabrics. Within the framework of the program of measures on integrated development of the silk industry until 2021, approved by the Uzbek government, about 30 mills for the processing of cocoons are currently being modernized in the country. Also, work is underway to organize 11 new specialized enterprises for deep processing of silkworm cocoons worth $83.2 million, most of which are planned to be commissioned this year. As part of the modernization, agreements were signed for the purchase of new equipment from such well-known companies as Van De Wiele, Picanol and Reggiani. As a result, it is planned to double the production of raw silk in three years and increase the figure to 3 thousand tons per year, and also through the deep processing of raw materials to increase the production of silk fabrics eightfold, reaching 11.2 million linear meters per year. Back in 2016, the extent of the use of production capacities of silk-processing enterprises in Uzbekistan was only 17%, and in 2017 it reached 54%. In 2016, products for $20.9 million were exported, and last year the figure reached $37.7 million. Today, Uzbek enterprises produce four types of goods: raw silk, silk wool, silk fabric and finished silk products, while last year the manufacturing process was concentrated on raw silk alone. By 2021, it is planned to establish production and export of at least five types of silk goods.
Source: The Times of Central Asia
Canada-based insights and strategy consultancy GlobeScan and the Sustainable Apparel Coalition (SAC) recently announced a new collaboration to develop robust communication guidelines and materials for engaging consumers globally on the Higg Index, a holistic suite of tools for measuring sustainability performance across the industry value chain. Both will try to identify what consumers want to know about the sustainability credentials of products, brands and manufacturers and how different channels and content can guide them in their purchase decisions. The study will also look ahead to how consumers envisage shopping and receiving information in the future, according to a GlobeScan press release. As transparency is the top driver for rebuilding trust and more than half of consumers across the world say that companies do not communicate honestly about social or environmental initiatives, this study will help to equip them with the information they need,” said GlobeScan director Caroline Holme. (DS)
Source: Fibre2Fashion
2018 The First World Textile Merchandising Conference (2018 WTMC) will be held at the Keqiao District, Shaoxing City of east China's Zhejiang Province in September 20-21, 2018. Nearly 1,000 leaders and representatives in the well-known enterprises of the textile industry, top fashion organizations, industrial associations, and design colleges from more than 20 countries including Italy, the United States, France, the Republic of Korea, India and Japan will attend the conference, where they will discuss the status quo and future trends of the global textile industry and share their opinions on the development of the industry. This conference will include an opening ceremony, a theme conference, roundtable sessions, parallel forums and site visits. The four parallel forums respectively themed as "Opening-up, Science & Technology, Fashion, Green Growth", will see participants share their ideas on the development trends and cutting-edge technologies of the textile industry in the future, highlight the development momentum of the global textile fashion industry, explore the transformation of China’s textile industry and search for the new forms for the sustainable development of the industry. Sun Ruizhe, president of China National Textile and Apparel Council (CNTAC), noted that this conference will focus on new hot spots and new trends in the development of world’s textile industry to establish a top platform for exchanges and cooperation around the world. It will also promote the building of a cooperation system throughout textile industry chain under the Belt and Road Initiative and the cooperation on international high-quality projects related to production capacity, so as to facilitate the integrative development of the global textile economy. According to Zhang Weijiang, secretary of the Party Working Committee of China Textile City Construction and Management Committee, the conference will release "Keqiao on Silk Road, Textile for the World" action plan, which features east and west routes. The east route is geared towards high-end markets of Europe and America, while the west route will reach out to countries and regions along the Belt and Road. Shen Zhijiang, party secretary of Keqiao District, Shaoxing City of Zhejiang Province, said that Keqiao District is the largest textile industry base in China. It has a complete textile industry chain covering raw materials, textile machines, fabrics, home textiles and garments. It also has the China Textile City, the largest textiles hub with the most complete products in the world. Under the guidance of CNTAC, China Chamber of Commerce for Import and Export of Textile and Apparel (CCCT) and China General Chamber of Commerce (CGCC), the conference will be hosted by Shaoxing Municipal Government, Productivity Promotion Division of CNTAC, Working Committee for Foreign Liaison of CGCC, apparel branch and fabric branch of CCCT, and People's Government of Keqiao District of Shaoxing city. (Source: Chinanews.com; edited by Zhang Yuan, zhangyuan11@xinhua.org)
Source: Xinhua Silk Road Information Serives
The sixth edition of FESPA Eurasia is expecting 25 per cent increase in the inflow of visitors since its inception in 2013. The leading event of the region for screen printing, textiles and digital wide format printing is scheduled to kick-start from December 6, 2018 in Istanbul. The previous FESPA Eurasia, held in 2017, welcomed 8.761 visitors. "Since the launch of FESPA Eurasia in 2013, we have developed our visitor portfolio by bringing together both new and previous participants every year. The fact that more visitors stay in the fuard for longer than a day shows the importance of this fair to the fuara loyalty and the market. It also has more than 82% of the walks. Eurasia is the most important fair to attend because of the work in the region," said Fespa Fairs director Roz Guarnori. "We were extremely pleased with FESPA Eurasia 2017. It gave us the opportunity to meet with market leaders and decision-makers from Turkey, Europe and North Africa. FESPA proved once again to be the right place for growing our business," said Abdul Moghith Alkhawam – FPI Tekstil, an exhibitor. FESPA Eurasia will be hosted in partnership with FESPA’s Turkish association, ARED, which means that the event will effectively reflect the needs and challenges of the regional Eurasia market. "Being a federation of national associations is one of our unique selling points. We work closely with our Associations to ensure that our events are tailored to the needs of the local audience. ARED runs the exhibition on the ground, ensuring that it will be relevant to today’s print service providers in Eurasia. FESPA’s global expertise in wide format print exhibitions will ensure that FESPA Eurasia 2019 will be the key event for speciality printers locally and further afield, and will continue its position as the region’s premier event in this market," Guarnori concluded.
Source: Fibre2Fashion
