|
Item |
Price |
Unit |
Fluctuation |
|
PSF |
1212.9475 |
USD/Ton |
5.02% |
|
VSF |
1937.7775 |
USD/Ton |
0.59% |
|
ASF |
2448.75 |
USD/Ton |
0% |
|
Polyester POY |
1289.675 |
USD/Ton |
3.27% |
|
Nylon FDY |
3052.775 |
USD/Ton |
0% |
|
40D Spandex |
6611.625 |
USD/Ton |
0% |
|
Nylon DTY |
1501.9 |
USD/Ton |
2.79% |
|
Viscose Long Filament |
3346.625 |
USD/Ton |
0% |
|
Polyester DTY |
5836.1875 |
USD/Ton |
0.42% |
|
Nylon POY |
1567.2 |
USD/Ton |
3.78% |
|
Acrylic Top 3D |
2856.875 |
USD/Ton |
0% |
|
Polyester FDY |
2595.675 |
USD/Ton |
0% |
|
30S Spun Rayon Yarn |
2620.1625 |
USD/Ton |
0% |
|
32S Polyester Yarn |
1893.7 |
USD/Ton |
0% |
|
45S T/C Yarn |
2889.525 |
USD/Ton |
0% |
|
45S Polyester Yarn |
2024.3 |
USD/Ton |
0% |
|
T/C Yarn 65/35 32S |
2481.4 |
USD/Ton |
0% |
|
40S Rayon Yarn |
2775.25 |
USD/Ton |
0% |
|
T/R Yarn 65/35 32S |
2612 |
USD/Ton |
0% |
|
10S Denim Fabric |
1.14275 |
USD/Meter |
0% |
|
32S Twill Fabric |
0.99909 |
USD/Meter |
0% |
|
40S Combed Poplin |
1.354975 |
USD/Meter |
0% |
|
30S Rayon Fabric |
0.728095 |
USD/Meter |
-5.11% |
|
45S T/C Fabric |
0.79013 |
USD/Meter |
0% |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.16325 USD dtd. 15/04/2015)
The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
Tirupur, the largest hub for knitwear exports in India for the first time ever in 2014-15 crossed Rs 20,000 crore but the growth in rupee terms has fallen sharply due to the swift depreciation of the Euro. . A Euro, which was commanding 85 in January 2014, gets only about 66 now is spoiling the export party in Tirupur. Europe is the largest market for Tirupur's garments which accounts for about 48% of the exports from Tirupur, the US constitutes only 25% of the shipments from the knitwear town. A Euro has depreciated 14% against the rupee so far in 2015.
As a result, Tirupur's exports increased only 15.5% year-on-year (y-o-y) in rupee terms to 20,730 crore in 2014-15. Exports surged 30% y-o-y in rupee terms to 17,817.1 crore in 2013-14, as per the data compiled by the Tirupur Exporters' Association (TEA). Interestingly, exports increased 15.9% y-o-y in terms of foreign currencies in 2014-15, almost the same growth level recorded in 2013-14.
According to Raja M Shanmugham, managing director (MD), Warsaw International, Tirupur-based garment export house, the sudden fall in the Euro has had a negative impact on exports. It has also affected rupee turnover. Euro depreciation has become a big problem as the realisations have fallen by 10%-12%. Though dollar billing and taking forward covers as a hedge against volatile currency movements would improve rupee revenues, most exporters don't do it as they consider it to be too complicated, say industry officials. And with the markets also remaining tepid in Europe, exporters are not in a position to hike prices.
According to Premal Udani, MD, Kaytee Corporation, a garment exporter, it is not possible to increase prices as the markets in Europe are still quite dull. Garment exporters typically work on 8%-10% operating profit margins giving them little room to adjust to currency fluctuations or raise rates. A Sakthivel, president, TEA. Exports from Tirupur have been hovering around the 13,000 crore mark between 2010-11 and 2012-13 due to the demand slowdown in Europe and the US. In fact, exports had declined in 2011-12. They expected Tirupur (knitwear) exports would achieve 21,000 crore (in 2014-15).
Despite the drop in growth due to currency woes, TEA has set target of 36,000 crore with the aim of touching this figure by 2016-17. The sharp increase in labour costs in key competing countries such as Bangladesh provided the much-needed fillip to garment exporters. With China, the world's largest producer and exporter of textiles, turning its attention towards engineering goods, garment makers in the country have been able to make significant progress in winning orders.
SOURCE: Yarns&Fibers
A Vessel Traffic Management System (VTMS) facility was inaugurated this morning at the Kamarajar port in Ennore to improve ship navigation in the port and adjacent coastal waters. Pon Radhakrishnan, Union Minister of State for Road ýTransport Highways and Shipping, inaugurated the Rs. 14.10 crore VTMS facility at the port. The facility at the port's signal station will help in safer ship movements at the port and outer anchorage. It will also help detect oil spills at an early stage in the harbour area. A similar facility has also been installed in the Chennai port. Arun Kumar Gupta, General Manager (Marine Services), Kamarajar Port Ltd, said that the VTMS was installed by Kongsberg Norcontrol Surveillance Pvt Ltd, Ahmedabad, a 100 per cent subsidiary of the Norwegian company Kongsberg Norcontrol. The system has been under trial since March, he said.
Integrated service
The VTMS is an integrated service that combines sensors like radar, automatic identification system, CCTV and meteorological aids to provide an overall view of ship movements in and around the port up to 24 miles. This will help the port authorities to take decisions on berthing of ships, navigation in restricted waters and improve security initiatives. The port now has also got a cyclone monitoring system, which will feed information to the Indian Meteorological Department, he said. Gupta said the port will also share information on movement of ships with the Coast Guard and Navy on a need basis. Minister Radhakrishnan said that the port will give a ‘healthy competition’ to other ports once two additional berths are constructed in the next two to three years. “I am confident that with the additional berths, the port will handle nearly 50 million tonne from the present 32 million tonne,” he said.
SOURCE: The Hindu Business Line
India will have to move in the direction of full capital account convertibility in order to play a meaningful and responsible role in the global economy, Jayant Sinha, Minister of State for Finance, has said. Capital account convertibility is also important for the country to deepen and broaden its capital markets, Sinha told reporters on the sidelines of a conference organised by pension regulator PFRDA, on Wednesday.
Full capital convertibility means local currency can be converted into foreign currency and back, for capital transactions. A foreign investor can thus repatriate money in his own currency. Currently, however, India allows full convertibility only in the current account and not in the capital account. “There are many policy measures and many things we have to do over a period of time if indeed India has to become one of the top three economies in the world,” Sinha added.
The Deputy Finance Minister’s remarks are significant as they come close on the heels of RBI Governor Raghuram Rajan’s statement last week that the central bank was looking to allow full capital account convertibility in a few years. Recently, India has taken several important policy steps, such as allowing international financial services centres in enclaves within the country. Such initiatives can be a success only when there is a full ecosystem and an enabling framework, including capital account convertibility, say capital market experts.
‘Retirement market’
Sinha also said that the government was focused on expanding the ‘retirement market’ in India, for which several initiatives have already been taken recently. Besides stressing on the need to allow more sophisticated products in the pension market, it is also important to ensure that more pension monies flow into equity markets, he added. Sinha said that expanding the ‘retirement market’ would bring India three benefits: it would protect citizens after retirement, result in flow of long-term funds into building infrastructure and help reduce volatility in the Indian stock markets.
NPS withdrawal
The Minister said prospective New Pension Scheme (NPS) subscribers should not get “bogged down” by the fact that NPS attracts tax at the time of withdrawal on retirement. “What is important is — are you saving enough for retirement,” he said. Later, Pension Fund Regulatory and Development Authority (PFRDA) Chairman Hemant Contractor told reporters that the GN Bajpai committee report will be taken up by the PFRDA Board in the next 2-3 weeks. The panel had, among other things, recommended that government employees subscribing to NPS be allowed to choose their own pension fund managers, which could open the doors for private fund managers to manage pension monies of Central and State government employees.
SOURCE: The Hindu Business Line
In a bid to convince India to shed its reservations and back the mega Silk Road initiatives, China today said besides linking its strategic ventures, Indian government can choose to take part in any of the projects in the South Asian region. "China and India should be partners in Silk Road projects. We should be primary pushers of the projects," Liu Jinsong, Deputy Director General of Economic Affairs told Indian journalists here today. "We (India, China) are the pioneers of globalisation. We can set the rules. We can cooperate with each other," he said. Earlier, Chinese foreign ministry said the Silk Road projects, specially the Maritime Silk Road (MSR) over which India has concerns about Chinese domination in Indian Ocean can link up with India's 'Mausam' and 'Spice Road' projects. Besides MSR, the projects include, a corridor connecting China with Europe through Central Asia, the Bangladesh- China-India-Myanmar (BCIM) corridor and the China-Pakistan Economic Corridor.
India is taking part in preliminary meetings of the BCIM. Liu said Indian and Chinese firms can work together in different parts not simply in India but in the region. He said the project maps in the official media showed Kolkata as the Indian lone port, but development projects can be undertaken in any place or port in India. "India can choose the ports it wants to develop," he said. He also defended China's plans to build an economic corridor with Pakistan through Pakistan-occupied Kashmir (PoK). He said the project did not interfere in the Kashmir issue which China wants India and Pakistan to resolve. "The Karakoram highway was built 50 years ago, we are taking advantage of an old project, this is not a new action. We are just doing business," he said. Asked why China objected to India's oil exploration projects with Vietnam in the South China Sea, Liu said, "If your exploration field is near Vietnam's coastal area no one will argue. But if you exploit a disputed area, it is a new action, so it is different".
SOURCE: The Economic Times
With the real effective exchange rate (REER) showing that the Indian rupee is overvalued by a whopping 13% as of March, the Reserve Bank of India could potentially buy a record amount of dollars for the second year in a row to keep the country’s products competitive compared with other emerging market economies. The central bank has already bought $20 billion in the first two months of 2015 after buying a record $82 billion during the 12 months of 2014. The rupee weakened 1.97% in 2014 owing the RBI’s intervention and is expected to weaken 3% in 2015. The currency ended at 62.37/$ on Wednesday. “Our forecast is that the rupee would be around 64.50/$ by December 2015,” said Anindya Dasgupta, MD & head-treasury, Barclays.
RBI
In 2014, the RBI bought an unprecedented $82 billion, the highest ever since the economy was thrown open to foreign investors. Historically, the central bank had bought an equally staggering amount only in 2007 (about $75 billion). In both episodes, RBI had cited the rupee’s overvaluation in terms of its real effective exchange rate and volatility-inducing lumpy flows as reasons for its interventions. “Flows could slow down compared with 2014, but the RBI will continue to buy dollars,” said Ashish Parthasarthy, head of treasury, HDFC Bank. Hitendra Dave, head of global markets at HSBC, agrees. “The difference between 2014 and 2015 is that the current account deficit is far lower. Assuming the same amount of capital flows, it leaves a much higher amount of absorbable surplus for the RBI,” he said.
India’s CAD is expected to narrow to below 1% of gross domestic product in 2014-15 from 1.7% in 2013-14 and 4.7% from 2012-13. Also, the rupee has been appreciating sharply against other currencies, such as the euro and the Japanese yen. The RBI’s REER that measures the currency’s competitive value against a basket of 36 currencies was 113.23 in March, which means the rupee has to depreciate by at least 13% for Indian exports to be competitive. In March, RBI governor Raghuram Rajan had said an excessively strong rupee is undesirable and that the central bank acts on limiting the volatility in the currency. He had also warned that given massive quantitative easing by central banks, such as the European Central Bank and the Bank of Japan, the threat of flows making the rupee uncompetitive is real. Indeed, the rupee’s depreciation has been small (around 1.6% so far in 2015) compared with emerging market peers. So far in 2015, Indonesian rupiah has slipped 4%, Brazilian real by 13% and South African Rand by 3.7%.
SOURCE: The Financial Express
India has a lot of potential of attracting international business but the 'ease of doing' business has to be improved, according to Indo-German Chamber of Commerce which pins hopes on Prime Minister Narendra Modi in this regard.Bernhard Steinruecke, Director General of the Chamber, hailed Modi's 'Make-in-India' programme and said German companies are "very optimistic" about India."It is a very good campaign. India needs manufacturing. On the other hand, Germans are probably the best in manufacturing. So, it is a win-win situation," he told PTI.
Steinruecke, former General Manager of Deutsche Bank, said India has a lot of potential as it has growth rate and a market and "everyone who wants to be a part of international industry has to be in India."At the same time, he noted that India's place in the list of 'ease of doing business' is "still in the wrong place" and "a lot of improvement has to come".Contending that it is possible, he said the approach of Prime Minister Modi to make things easier is "the most important thing" and "if the government is doing it, things will improve more".
Asked to comment on rules and regulations, Steinruecke, who has seen Indian system from close quarters, said: "it can always be better".On taxation in India, he said, "it is complex but tax systems are complex all over the world. Even in Germany they are complex."He said taxation rules are "always a challenge" all over the world "because there is a lot of work and sometimes there are things that are not cleared."He then referred to the Retrospective Tax rule brought by the previous government two years back and said, "it was not good" and "caused a lot of problems".
On this, he is pinning hopes on the new government. "The new government has said it will not have tax like that. From that angle, it is going in the right direction."Steinruecke, however, said German companies were not dissuaded by the Retrospective Tax."We have 1600 German companies in India. They are still interested and they are interested in investing more," he added. German companies, which have a good track record, are "very optimistic about India", he said, adding that they "will do more" and "this is the time".
SOURCE: The Economic Times
The annual rate of inflation, based on monthly wholesale price index (WPI), stood at minus 2.33 per cent for March 2015 (over March 2014), according to the provisional data released by the Office of the Economic Adviser, Ministry of Commerce and Industry. In comparison, annual rate of inflation was minus 2.06 per cent for February 2015 and 6.00 per cent during March 2014. Build up inflation rate in the financial year 2014-15 remained negative and was at minus 2.33 per cent compared to a build up rate of 6.00 per cent in the corresponding period of the previous year. Meanwhile, the official WPI for all commodities (Base: 2004-05 = 100) for the month of March, 2015 rose by 0.2 per cent to 176.1 from 175.8 for the previous month.
The index for manufactured products (weight 64.97 per cent) for March, 2015 declined by 0.1 per cent to 153.9 from February 2015’s level of 154.1. The index for textiles sub-group also declined by 0.2 per cent to 139,9 from 140.2 for the previous month due to lower price of man-made fabric (2 per cent) and man-made fibre, cotton yarn and tyre cord fabric (1 per cent each). However, the price of gunny and hessian cloth (2 per cent) and cotton fabric, jute sacking cloth, jute sacking bag and jute yarn (1 per cent each) moved up.
The index for primary articles (weight 20.12 per cent) declined by 1.0 per cent to 239.6 from 241.9 for the previous month. On the other hand, the index for fuel and power (weight 14.91 per cent) rose by 3.3 per cent to 187.3 from 181.3 for the previous month due to higher price of aviation turbine fuel, furnace oil, high speed diesel, petrol, naphtha and kerosene. Meanwhile, the all-India consumer price index (CPI) on base 2012=100 stood at 5.17 (provisional) in March, 2015 compared to 5.37 in February, 2015 and 8.25 in March, 2014, according to the Central Statistics Office, Ministry of Statistics and Programme Implementation. (RKS)
SOURCE: Fibre2fashion
The Iran-US nuclear deal, expected to be concluded by June-end, should pave the way for free trade with Teheran. This will relatively end preferential treatment accorded to India under the Indo-Iran rupee payment agreement. Usage of the rupee account will be need-based and will not remain a pressure point on Iran. A way may also be found by Iran to repatriate the balance in the rupee account in hard currency after the sanctions are lifted.
Earlier pacts
Historically, Indo-Iran trade has gone through a metamorphosis after a few years, leaving many issues unresolved. India’s past experience of two earlier pacts with Iran have not been good as both ended abruptly. First, the Kudremukh Iron Ore Company Limited (KIOCL) barter in 1976, against which Iran invested $630 million in return for iron ore. It was abandoned in 1980 due to changed political realities. Thereafter, another bilateral trade and payment mechanism – Asian Clearing Union (ACU) - was terminated by the RBI in December 2010 under US pressure. Export of non-basmati rice and wheat in 1994-95 was done under ACU. Thereafter, the Dubai route emerged. In February 2012, India’s UCO Bank was nominated to deal with four Iranian banks for payment in the ratio of 55:45 of hard currency and rupee respectively.
Rice, oilmeal cases
The accompanying chart shows a significant decline in major Indian commodities after US-Iran “interim” agreement was signed in November 2013. This is not a matter of conjecture but reflected by facts on ground. Basmati exports to Iran flourished initially between 2012-13 and 2013-14 relying on three major buyers. But over the last 18 months, some suppliers have their deemed profits wiped out and registered losses in their balance sheets. The same is true with oilmeal exports. Not only money made in some bargains was lost subsequently – India abandoned its traditional markets due to value distortion created by high priced exports to Iran. Raw sugar export was somewhat workable at lower volumes in 2014 but there has been no repeat business.
The government made persistent efforts to export wheat by getting relaxation for Karnal but for “negligible percentage” instead of “nil” but the phytosanitary and plant quarantine authorities in Iran have not budged. Apparently, value-added business of pharmas and rail lines/steel pipes seems to be doing well. Engineering business/oil exploration is also being supported at the political level in view of India’s concerns with Pakistan, Afghanistan and Balochistan. In commodity trade, trading experience even under rupee trade managed through UCO Bank has not been very rewarding for the Indian counterparties due to two vital factors.
First, Indian traders are competing against one another and sabotaging business by offering varying terms of trade and compromised specifications. Secondly, Iran knows that the Indian side has made money and they levied customs duty or imposed rigid customs regulations that offered Iranian buyers opportunities to a rebate on contracted prices. In both these cases, Iran called the shots.
Bureaucratic bottlenecks
Indian trade has no contractual recourse because Iranian law is incorrigible. In Government business, bid bonds and guarantees are demanded with unlimited time frame. Letters of credit once issued by Iranian banks are very difficult to get amended. Government departments are working in silos – for example – commerce department will have no say in agriculture – the type of working relationship we have in India. Iranian traders cite currency fluctuations or some government regulations for non-performance and Indians are totally at their mercy because the factual position remains veiled. GTC and other traders have very “intimate” contact with MNCs. Their “preference” for commodities lies elsewhere except basmati rice.
Even during sanctions, food items were not under any prohibition, so Iran continued to source elsewhere despite surplus in UCO Bank rupee account. Iran works according to its priorities with patience – with utter disregard to any agreed provisions – and it is not possible to extract a viable bargain because traders are exposed to rough and tough trading environment. On a short-term basis, India may find itself isolated from Iran in trade (except basmati rice). Iran will court Western powers/China and other origins for trading and building up its other petrochemical capabilities. All nations (P5+1) are not signing the nuclear agreement for charity. Trade, in preference to investment, will be foremost in their minds.
Dubai will surely emerge as a vital trading hub. Indian trade will be best served by dealing with Dubai counterparties who may take exposure to Iran. Iran too will go through the developmental phase. But surely it will rebuild its nuclear capabilities under one pretext or the other. That will again lead to some sort of disruptive environment in trade. The on-going Sunni-Shia discord can also go through an expansionary phase which may compel western powers again for interventionist measures. Thus, in long term, India will again be in the reckoning. At this point of time, India has to walk back in trade.
SOURCE: The Hindu Business line
The Centre has renamed the online visa scheme for travellers as ‘e-Tourist Visa’ (eTV). The scheme was earlier called ‘Tourist Visa on Arrival-Electronic Travel Authorisation’ (TVoA-ETA). A statement from the Ministry of Home Affairs said on Tuesday that the extension of the scheme to more countries and airports will be in a phased manner, in order to avoid any confusion. The name of the scheme was creating confusion among tourists as they presumed that visa is being granted on arrival. However, the pre-authorisation of visa to foreigners is being given prior to travel. TVoA-ETA was launched on November 27, 2014 to 44 countries at nine airports — Delhi, Mumbai, Chennai, Kolkata, Hyderabad, Bengaluru, Kochi, Thiruvananthapuram and Goa — to facilitate short duration international travellers. Since the launch of the scheme, 1.1 lakh visas have been issued by Government under this scheme, the statement added.
A foreign tourist has to apply online, upload a photo and passport and pay a fee online. In 72 hours, the applicant would receive an ETA by e-mail. The 30-day permit would include sightseeing, visiting friends and family, recreation, short duration medical treatment, and a casual business visit.
SOURCE: The Hindu Business Line
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$ 58.36 per barrel (bbl) on 15.04.2015. This was higher than the price of US$ 57.44 per bbl on previous publishing day of 14.04.2015.
In rupee terms, the price of Indian Basket increased to Rs 3641.66 per bbl on 15.04.2015 as compared to Rs 3583.68 per bbl on 14.04.2015. Rupee closed weaker at Rs 62.40 per US$ on 15.04.2015 as against Rs 62.39 per US$ on 13.04.2015. The table below gives details in this regard:
|
Particulars |
Unit |
Price on April 15, 2015 (Previous trading day i.e. 14.04.2015)
|
Pricing Fortnight for 16.04.2015 (March 28 to April 10, 2015) |
|
Crude Oil (Indian Basket) |
($/bbl) |
58.36 (57.44) |
54.92 |
|
(Rs/bbl |
3641.66 (3583.68) |
3425.91 |
|
|
Exchange Rate |
(Rs/$) |
62.40 (62.39) |
62.38 |
SOURCE: PIB
Man-made fibre (MMF) output in Japan declined marginally in February 2015 compared to a year-ago period. In February 2015, MMF production in Japan stood at 76,344 tons, showing a decline of 0.8 per cent year-on-year. Among MMF, the production of synthetic fibres dropped by 4.7 per cent to 60, 254 tons, according to the Japan Chemical Fibres Association.
On a month-on-month basis, polyester staple fibre (PSF) production decreased by 5.4 per cent to 11,656 tons in February 2015, while polyester filament production fell 7.3 per cent to 10,138 tons. Similarly, acrylic staple fibre (ASF) production dropped 11.8 per cent to 8,391 tons, and nylon filament output fell 4.8 per cent to 7,333 tons. (RKS)
SOURCE: Fibre2fashion
The Century Synthetic Fiber Corporation (CSFC), after successfully issuing 5 million shares last December, has decided to list its shares on the bourse this June. CSFC is one of the very few fiber manufacturers listing shares on the stock market. Its customers are not only final product users, but fabric manufacturers as well. Thanh Cong Joint Stock Co (TCM) is another fiber manufacturer on the bourse. However, TCM’s major products are garments; it makes fiber only to get the best out of the closed production line. There are few Vietnamese companies like CSFC, but this will change in the near future when Vietnam signs the TPP, which will apply the “yarn forward” principle in the textile and garment sector.
Under this principle, preferential tax rates will be applied to products made of fiber sourced from TPP countries. This means that Vietnamese products will not be able to enjoy preferential tax rates if it continues using materials from China. As a result, analysts say that Vietnamese have begun pouring money into fiber projects. CSFC, for example, has been expanding its production scale for many years. In 2000, its factories could churn out 4,800 tons of fiber. The figure is expected to rise to 41,000 tons per annum in 2015, an increase of 24 percent over the last year.
The corporation plans to spend VND890 billion on a factory at its Trang Bang Branch in the next two years. Dang Trieu Hoa, chair of CSFC, said at the shareholders’ meeting in late March that the expanded production can satisfy only a small part of the demand. The Vietnam Textile and Garment Corporation (Vinatex) has also geared up with investments in fiber manufacturing projects. In late March, it kicked off the Que Son fiber – textile - dyeing – garment complex project, capitalized at VND1.2 trillion. The fiber factory in the complex, scheduled to become operational in 2017, is expected to put out 5,000 tons of fiber a year. A senior executive of Vinatex revealed that the corporation plans to develop 51 projects in the new development period, including 14 fiber projects, the products of which would be provided to Vinatex’s subsidiaries.
FPT Securities said that Vietnamese enterprises in the textile and garment sector are mostly following the CMT model (cutting, making, trimming). Only 6 percent of enterprises are spinning. The countries participating in TPP Agreement have set a target of concluding TPP negotiations in 2015 and this is within reach. By the end of 2014, TPP members underwent 19 official rounds of negotiations and many others at chief negotiator and ministerial levels along with high-level meetings.
SOURCE: The Global Textiles
As budget preparations get under way for fiscal year 2015-16, Pakistan Textile Exporters Association (PTEA) Chairman Sohail Pasha has come up with proposals for the financial plan. “The coming budget should be progressive and growth-oriented, providing necessary directions in a bid to stimulate investment and generate more revenue for the government purse,” he said while speaking at a pre-budget seminar, organised by the Institute of Cost and Management Accountants (ICMA) Pakistan, here on Wednesday.
Pasha said foreign trade played a vital role in economic development of any country, which had undergone revolutionary changes. “Protective tariff and trade barriers are falling and an era of open market has set in,” he said. “Artificial props are tumbling down and fierce competition is heralding the survival of the fittest.” Pasha pointed out that textile exports were in the grip of a severe crisis as high cost of doing business and lack of competitive edge over regional rivals, primarily due to energy constraints and unavailability of funds, were hurting export growth. To cope with the challenges, he suggested, exports should be competitive and viable in international competition and textile exporters should have a level-playing field. “Regional nations are providing a lot of subsidies and incentives to their textile export sector to remain competitive in the international market.” Recently, in a bid to engage in stiff competition with Pakistan, India has announced huge subsidies for its textile exporters to edge out Pakistan in the European Union market.
Comparing the energy cost with regional rivals, Pasha said gas price in Pakistan was around $6.27 per million British thermal units (mmbtu) whereas in Bangladesh it was just $1.91, in India it was $4.20 and in Sri Lanka the price was $3.66. “The government should consider providing some kind of subsidy in utilities to the textile industry,” he suggested. He was of the view that the government, instead of helping the textile industry to survive through difficult times, was creating hurdles by withholding taxes and other refund claims. “Blocking of capital is a serious issue faced by textile exporters as a big chunk of their working capital has been stuck for a long period of time in the refund cycle.” Textile is a vital part of the economy as it contributes 60% of foreign exchange earnings and generates 42% of employment. “Therefore, it should be given due importance in the budget,” he said. “International market fundamentals cannot be changed, but domestic impediments to production can be removed.” Concluding, Pasha said the government should particularly focus on productive tasks in the budget as they would lead to new investments.
SOURCE: The Tribune
China's economy grew in the first three months of 2015 at its slowest quarterly pace in six years, dragged down by an industrial slowdown and a weak housing market, the government announced Wednesday. Gross domestic product rose 7 per cent from a year earlier, in line with economists' forecasts. While the growth rate means China still ranks as one of the world's fastest growing major economies, it marked the country's slowest quarterly expansion since early 2009, when it was still feeling the effects of the global financial crisis. China's Communist Party leadership has lowered its official growth target for this year to around 7 per cent. This would be the nation's slowest annual expansion in 25 years, but leaders have said this is a price that needs to be paid in order to reduce the economy's reliance on credit-fuelled growth and get everyday shoppers to spend more of their savings.
Recent indicators suggest that the economy could be slowing more rapidly than many observers expected. In March, industrial production rose 5.6 per cent from a year ago, its slowest increase since late 2008. Land purchases by real estate developers plunged 32 per cent by area in the first three months of the year. Premier Li Keqiang told a forum of Chinese economists on Tuesday that economic performance in the first quarter "has a strong role as a weathervane," according to a report in the Beijing News newspaper. The pace of growth in the first quarter "supported quite ample employment, and residents' incomes have also risen in step," the Beijing News said, summarising Li's comments. "But on the other hand we must see that downward economic pressure indeed continues to grow," Li said. "Some of our traditional sources of strength are receding, and at the same time there are newly emerging sources of growth, and some sunrise industries are experiencing explosive growth."
For example, retail sales in March rose 10.2 per cent, the slowest increase in nearly a decade. But online merchandise sales increased 41 per cent in the first quarter, and now account for about 9 per cent of all sales of consumer goods in China. Foreign trade, by contrast, has been buffeted by lacklustre overseas shipments and signs of even weaker demand at home. Exports of goods by value rose only five percent in the first three months of the year, while imports slumped 17 per cent, weighed down by lower global prices for oil and other commodities. The housing market continues to struggle, with home prices falling and new construction starts declining. This has far-ranging effects at home and abroad, including on domestic steel production, pricing of imported iron ore from Australia and the employment of sales agents at property brokerages across China.
Sheng Laiyun, the spokesman for China's National Bureau of Statistics, said that "downward pressure" on the Chinese economy came from both external factors, including the tepid recovery of many economies, and also from domestic factors. New sources of growth were emerging, he said, "but in the short term it's difficult for them to make up for the subsiding of traditional drivers." China's leaders have responded to the slowdown by easing monetary policy but have held off from introducing more aggressive stimulus measures. Since November, the central bank has cut interest rates twice and freed up banks to lend more. Most economists expect further cuts in the coming weeks or months.
These measures do appear to be having an effect, with key short-term borrowing rates in China's money market, an important indicator of the real cost of funding for smaller banks and other financial institutions, falling to around 3 percent in the past week, down from around 5 percent in February. Despite this, there are still few signs that the government's efforts at weaning the country off of credit fueled growth are succeeding. Total credit growth has slowed in recent months, but it is still outpacing G.D.P. growth, meaning China as a whole is growing more indebted. The biggest factor here continues to be the increase in corporate borrowing. In his remarks on Tuesday, Mr. Li emphasized that the government would persist with planned economic and financial overhauls despite slowing growth. "Our toolbox still has many policy tools, and the biggest tool is reform," Mr. Li said. "There certainly is pressure now, and the pressure on some sectors is quite heavy. But there is also impetus, and many businesses take a positive long-term view of this market," he added.
SOURCE: The Business Standard
Benzene prices surged 13-16% in March across regions while US numbers hit a four-month high in the first week of the month. In Asia, a strong demand for May cargoes supported prices to go up while in European bullish sentiments caused prices to jump. In US, derivative styrene’s demand for benzene held firm as participants eyed export opportunities to Europe, which ultimately led to reductions in benzene supply locally. In Latin America, benzene prices rose week on week tracking key global markets higher.
Asian benzene marker, the FOB Korea was assessed at US$755-756 a ton while US spot benzene prices rose 16% to US cents 249.70-249.80 per gallon FOB USG. European spot benzene price averaged US$702-703 a ton CIF ARA while FOB Rotterdam values were at US$712-713 a ton, both up 16% on the month. Naphtha prices for March averaged US$530 a ton CFR Japan, up US$98 from previous month. The market took severe beating in the first three weeks but recovered sharply in the last on crude oil support.Thus, the rapid rise in benzene prices over naphtha has widened the spread between the two. European benzene margins jumped to a US$368 a ton premium over naphtha, as benzene exports out of the ARA to the US Gulf Coast shortened supply length in Europe. Similarly, the premium over USG naphtha US$306 a ton and that in Asian markets was close to US$240 a ton. So far in 2015, the spread averaged US$183 a ton for Asia, US$281 a ton for Europe and US$223 a ton for US. In normal business conditions, a premium of US$250 a ton is termed as sufficient to cover production costs.
The spread has widening from February as more material was absorbed by US, but it will take a while for the supply chain to absorb all the molecules around. The benzene market was in ample supply since the beginning of the year as a combination of high cracker run rates and turnarounds at downstream SM units left an abundance of material in the European region. Market experts expect the spread to widen further when downstream SM units are back online in the second quarter which would spur an uptick in demand for benzene. Meanwhile, caprolactum prices surged slightly in March on the back of supply snug, increased demand and rising benzene prices. Demand increased as run rates at nylon chip and nylon textile makers picked up. Sinopec and DSM Nanjing Chemical adjusted up their settlement for March. Asian caprolactum spot prices averaged US$1,650-1,690 a ton in March, up 8% from last month. Similar, numbers for US averaged US$1,425 a ton, up 2% and Euro1, 548 a ton in Europe, up 1% over February.
Nylon chip prices picked up on support of the rally in benzene and firming caprolactum markets amid decent downstream demand and low inventory. In China, as downstream mills resumed operation, overall operating rate picked up. However, buying interest remained cautious given inventory built up earlier. In non-textile-yarn, cord fabric and fishing net yarn, buying interest for chips was mild, with prices held stable. Offers for Taiwan-origin chips averaged US$1,980-2,000 a ton, up 7% from February. In China, bright conventional spinning nylon-6 chips were priced at US$2,247-2,430 a ton while semi-dull chips were offered at US$2,350-2,480 a ton.
Nylon filament yarn prices looked up on raw material costs while prices of staple fiber and cord fabric were on a firm note. In China, although nylon yarn sector was picking up, orders were still limited on lusterless end demand against surplus supply, exerting resistance on price hike of nylon yarn. Overall demand was seen not active enough, thus producers resumed production slowly. In China, semi-dull FDY70D/24F was traded at US$2.95-3.01 a kg, up US cents 2 while FDY40D was pegged at US$3.29-3.47 a kg, up US cents 3-5 from February. Thus, the spurt in benzene had a quick percolating effect of the nylon chain as prices all along were seen rising in March. Expectation of a further surge in benzene values will only add to the escalation and buyers will seek to replenish as much as possible to balance cost and pricing of their end products.
SOURCE: Yarns&Fibers
A section of readymade garment factory owners has alleged that the Alliance for Bangladesh Worker Safety, a consortium of North American retailers, is incorporating additional corrective action plan to factories during its follow-up inspection. The factory owners have recently informed the Bangladesh Garment Manufacturers and Exporters Association that the inclusion of additional CAP may hamper the smooth progress of remediation process. The BGMEA last week requested the North American retailers group to limit follow-up visits to factories and not to include additional cap as the factories are implementing CAPs on initial findings.
A senior official of Alliance said that they had received a letter in this regard from the BGMEA and assured the garments factory owners that in the final inspection the Alliance declared factories compliant or noncompliant based on the implementation of corrective action plans on initial findings. ‘We are giving follow-up findings to some factories to help the factory authorities in ensuring more safe working place in their establishments but the progresses of follow-up corrective actions will not be considered during the final inspection,’ he said.
BGMEA officials said that the follow-up inspections were usually carried out to assess the corrective actions taken on the points originally covered in the CAP. The BGMEA in its letter requested the Alliance to evaluate the corrective actions to a later date after implementation of the original CAP. It said that new findings were likely to hamper the remediation process as factory owners were engaged in implementing the original CAP.
After the Rana Plaza building collapse in April 2013 that killed more than 1,100 people, mostly garment workers, the North American retailers formed Alliance for Bangladesh Workers Safety. The initiative launched inspection programmes in the Bangladeshi RMG factories from where their members procure products and completed their primary safety assessments in their listed factories numbering over 600. The retailers’ group targeted to complete its final inspection by July 2017 and now the Alliance is verifying through periodic visits that factories are making progress and completing remediation in accordance with the Alliance standards.
SOURCE: The Global Textiles
