Textile Raw Material Price 2015-05-19
|
Item |
Price |
Unit |
Fluctuation |
|
PSF |
1280.52 |
USD/Ton |
-0.25% |
|
VSF |
2044.25 |
USD/Ton |
0% |
|
ASF |
2498.07 |
USD/Ton |
0% |
|
Polyester POY |
1316.50 |
USD/Ton |
-1.23% |
|
Nylon FDY |
3139.97 |
USD/Ton |
0% |
|
40D Spandex |
6541.60 |
USD/Ton |
0% |
|
Nylon DTY |
3385.28 |
USD/Ton |
0% |
|
Viscose Long Filament |
5936.50 |
USD/Ton |
0% |
|
Polyester DTY |
1610.87 |
USD/Ton |
-1.01% |
|
Nylon POY |
2943.72 |
USD/Ton |
0% |
|
Acrylic Top 3D |
2693.50 |
USD/Ton |
0% |
|
Polyester FDY |
1537.28 |
USD/Ton |
-1.05% |
|
30S Spun Rayon Yarn |
2731.12 |
USD/Ton |
0% |
|
32S Polyester Yarn |
2060.60 |
USD/Ton |
0% |
|
45S T/C Yarn |
2992.78 |
USD/Ton |
0% |
|
45S Polyester Yarn |
2207.79 |
USD/Ton |
0% |
|
T/C Yarn 65/35 32S |
2567.58 |
USD/Ton |
0% |
|
40S Rayon Yarn |
2894.66 |
USD/Ton |
0% |
|
T/R Yarn 65/35 32S |
2763.83 |
USD/Ton |
0% |
|
10S Denim Fabric |
1.14 |
USD/Meter |
0% |
|
32S Twill Fabric |
1.00 |
USD/Meter |
0% |
|
40S Combed Poplin |
1.36 |
USD/Meter |
0% |
|
30S Rayon Fabric |
0.78 |
USD/Meter |
0% |
|
45S T/C Fabric |
0.79 |
USD/Meter |
0% |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.16354 USD dtd. 19/05/2015)
The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
Apparel exporters' body AEPC today demanded interest subsidy scheme among other things to boost exports. Apparel Export Promotion Council of India (AEPC) Chairman Virender Uppal said exports grew by 9.24 per cent in April this year but it was 13.4 per cent in April 2014. He said free trade agreement with European Union and Canada would help in mitigating "the duty disadvantage suffered by India vis-a-vis our competitors like Bangladesh, Cambodia, Vietnam, Pakistan etc. in the major markets". He also asked the government to announce the 3 per cent interest subvention scheme with effective from April last year to "partially mitigate high cost of lending, which is hovering around 11-12 per cent as compared to 4-6 per cent in competing countries". He also suggested for extension of duty benefits to major markets like the US, EU, Canada, Mexico, Australia, Switzerland and Russia. For improving ease of doing business, the actual implementation of 24x7 clearances of import and export at the ports should be be ensured by customs authorities, he said in a statement. In 2014-15, garment exports grew by 12.2 per cent to $16.83 billion.
SOURCE: The Economic Times
After a meager 2.8% rise in March, India’s garment exports grew 9.2% in April from a year before, Apparel Exports Promotion Council (AEPC) chairman Virender Uppal said on Tuesday. Apparel exports hit $1.44 billion in April, compared with $1.32 billion a year earlier. The growth rate in garment exports last month is lower than 12.2% expansion in the entire last fiscal. However, the growth is still impressive, considering the country’s overall exports dropped 14% in April from a year before, having dropped by 21% to hit a 67-month low in March.
Despite the relatively better performance by the garment sector, Uppal said there has been “a vacuum in a policy support” to the readymade garment manufacturing export industry. In the recent FTP announcement, certain export incentives were withdrawn. AEPC had recommended a 5% duty credit scrip for major markets, including the US and the EU, and a flat rate of 2% for other nations. “No Merchandise Exports from India Scheme (MEIS) has been announced to Latin America, West Asia, CIS countries, Africa and Oceania countries. The non-traditional markets which constitute around 35% share in India’s garment exports are poised to receive a setback due to withdrawal of the benefits of the Chapter 3 benefits,” Uppal said.
The EU market constitutes 41% of the India’s RMG exports. While conditions in major markets like EU continue to be far from satisfactory, India is also facing a duty disadvantage of 9.6%, compared with competing countries like Bangladesh and Pakistan which are having zero duty access to that market. Similarly, the US constitutes 21.7% of India’s RMG exports and the market condition in the US is yet to rebound sharply. “The prospects of considerable improvement in the market are rather limited due to competition from countries like Vietnam and Mexico, which have zero duty access under preferential treaties with the US,” Uppal said.
SOURCE: The Financial Express
Union textile ministry to roll out schemes to the tune of Rs.427 crore to promote geotechnical textiles in the North East India. The foundation stone for an Apparel and Garment Making Centre at Guwahati was laid by Tarun Gogoi, Chief Minister of Assam and Santosh Kumar Gangwar, Union Minister of State for Textiles on Tuesday. Gangawar said Prime Minister Narendra Modi has given special attention to the Ministry of Textiles, with special focus on states in the North Eastern Region. The Apparel and Garment Making Centres are being opened in every state in the region, as part of the landmark initiative announced by Modi in Nagaland, on December 1, 2014. Work on such a Centre for Nagaland has already begun. The Minister laid the foundation stone for an Apparel and Garment Making Centre in Manipur on March 24, 2015, in Sikkim on March 25, 2015, and in Arunachal Pradesh on April 16, 2015.
Under this scheme each state will have one centre with three units, each having 100 machines. For local entrepreneurs with requisite background, required facilities to start a unit will be provided in 'plug and play' mode. Once such entrepreneurs get established, they can set up their own units, allowing the facility to be provided to new entrepreneurs. The initiative comes under the North East Region Textile Promotion Scheme (NERTPS) of the Ministry of Textiles. NERTPS is an umbrella scheme for the development of various segments of textiles, i.e. silk, handlooms, handicrafts and apparels & garments. The scheme has a total outlay of Rs. 1038.10 crore in the 12th Five Year Plan. Gogoi said that geotextiles will be very useful for Assam. Secretary, Ministry of Textiles, Dr. S. K. Panda said that the garment making Centre will provide employment to the youths of Assam.
The project will be completed in three months by M/s. NBCC; the total cost of the project would be Rs. 18 crore, fully funded by Government of India. He said that this project will be helpful in skill upgradation, garment development and marketing. The Secretary added that a scheme, worth Rs.427 crore, has been sanctioned to promote geotechnical textiles in the North East, which will be helpful in stabilizing roads, addressing the problem of landslides and preserving water bodies.
SOURCE: The Economic Times
A discussion on revival of handloom, with particular focus on increasing earning of handloom weavers, was held at 6 PM on 17th May, 2015; all main stakeholders from Government, industry and civil society participated. The meeting was organized by the Office of Development Commissioner (Handlooms), Ministry of Textiles, at India International Centre, New Delhi. Shri Alok Kumar, Development Commissioner (Handlooms) initiated the discussion by apprising the gathering of the challenges faced by handloom weavers; however, he expressed optimism regarding the future of the sector. Dr. S.K. Panda, Secretary (Textiles), Government of India, made a detailed presentation on the subject; he asserted that concern for the handloom weavers should guide all interventions of state and non-state actors. He outlined the context in which the handloom weavers operate, and the various policy interventions that Government of India has been making in order to improve the earning of handloom weavers. He highlighted the potential of technology based interventions such as online marketing and of the financial inclusion scheme Pradhan Mantri Jan Dhan Yojana. He concluded by saying that youth, fashion and technology hold the key to the future of handloom. A booklet titled Increasing earning of the handloom weaver brothers and sisters (written by Dr. S. K. Panda and released by the Uttar Pradesh Governor, in Varanasi on 13th May, 2015) was distributed during the session. This was followed by a panel discussion on the subject. The panel consisted of Ms. Sudha Pillai IAS (Retd.), former Member Secretary of the Planning Commission; Ms. Jaya Jaitley; leading fashion designer Ms. Ritu Kumar; Ms. Anita Lal, a leading industry representative and founder of Good Earth; and Dr. S.K. Panda.
The panel discussed the need to excite the younger generation about handlooms, the diversity of marketing opportunities available to promote handlooms, the need for innovations in design and weaving processes and the need for customer education. It was discussed that Weavers Service Centres are being strengthened and are being given top priority by the Government of India. The Development Commissioner (Handlooms) in his vote of thanks, said that fresh thinking in design is required, which can put together art, economics and the market.
SOURCE: The Business Standard
Indian exporters are worried at falling shipments and a slide in the rupee. S C Ralhan, president of the Federation of Indian Export Organisations, talks to Sanjay Jog on the situation. Edited excerpts:
India’s exports slumped in April from a year earlier, the fifth such month in a row. Why?
The decline is due to a combination of global and domestic factors. Global trade is contracting and each forecast is further reviewing it down. The softening of crude oil, metals and commodities prices in international market also played a role. At home, manufacturing has not picked up on a sustainable basis. While data for one month seems promising, it disappoints us the next month. There is a correlation between manufacturing growth and export growth, a gap of about three months. Manufacturing declined in 2012-13 and grew only one per cent in 2013-14; therefore, exports also suffered in those years.
Second, there is huge volatility in the currency market. While the rupee depreciated against the dollar, it appreciated by about 20 per cent against the euro and 12-13 per cent against the yen. This has put lot of pressure on our exports to Europe, a fifth of the total. With a 20 per cent currency advantage, manufacturers in Europe have suddenly become competitive. India and many other countries are now losing to European manufacturers and suppliers in third countries, too. Moreover, the logistics cost is blunting our competitive edge. The freight (cost) in carrying a container from Kanpur to the Jawaharlal Nehru Port Trust (Navi Mumbai) is many times costlier than carrying it from JNPT to a port in Europe.
A contraction of 14 per cent in merchandise exports is a major contributor.
This is because crude oil prices have come down, impacting our petroleum exports, down by 46 per cent, a sector which contributed to about a fifth of total exports. This itself explains a nine per cent dip. More, prices of most agricultural commodities are at the 2008 level and, thus, such commodities are exhibiting a downward value-wise trend. I am also worried at the decline in export of leather goods, gems and jewellery, marine products, meat, dairy and poultry, which have a very high capital to employment ratio. However, the growth in export of engineering, pharmaceuticals, chemicals, handicrafts and carpets augur well for the future.
Falling demand is a major worry. How can this be addressed?
We are not a major player in world trade; our share is less than two per cent. Therefore, even the contracted size of the cake offers much to us. My focus would be on marketing. Let us first show the world what we can offer. Many countries in the world are not informed of our competencies and capabilities. Some years before, Iran, our close neighbour, was not aware of our competitiveness in pharmaceuticals and the fact that a sizable size of our pharma export is to America and the European Union (EU). This is true for many sectors in many countries. The government should agree to the FIEO demand for an Export Development Fund to support aggressive marketing, particularly by medium, small and micro enterprises, which struggle with financial liquidity and, thus, cut marketing expenditure.
China and Bangladesh are expected to grab markets where we might have consolidated further.
We lose our competitiveness due to high cost of credit, inefficient logistics, ground-level transaction costs and infrastructure inadequacies. We have to address each of these to compete with China, Bangladesh or any other low-cost country. Second, we have to look forward and enter into regional value chains and subsequently into the global value chain. Why not export premium fabrics to Bangladesh, get it stitched there and export to the EU and other places to take the import duty advantage which Bangladesh enjoys as a Least Developed Country? The CMLV (Cambodia-Laos-Myanmar-Vietnam) countries offer a similar advantage, which can be exploited to do part-manufacturing into those countries to adhere to the rules on origin, to take full advantage of their free trade agreements with China or the EU.
Has the discontinuation of benefits/incentives in the new trade policy impacted exporters? What do you expect from the government to make exporters provide a level playing field?
Yes, the discontinuation of the benefits has affected exporters particularly those who are already supplying under a contract executed prior to April 1,2015. Moreover, many exporters, encouraged by Focus/ Special Focus market scheme and Focus Africa and Focus LAC ( Latin American countries) Scheme of the Commerce Ministry were working on sustained basis to enter into those markets firmly entrenched by China. When they have succeeded now, they have been taken aback as either the newly developed market is not covered under Merchandise Exports from India Scheme (MEIS) for their product or the benefits have been reduced from 4% to 2%. We have requested Government to continue with earlier benefits till September 30 this year or allow such companies benefits available under the previous policy, in cases where the contracts have been finalized before commencement of the new Foreign Trade Policy.
SOURCE: The Business Standard
Krishna district is emerging as a hub for textile industries with a total of investment of nearly Rs. 415 crore already made by 12 enterprises in the last few years and more projects are in the offing, going by the number of inquiries being made with the District Industries Centre (DIC). The DIC attribute the trend to the proximity of the district with Guntur which is a major source of raw material. The upland areas of Krishna district have so far been the favourite of the textile companies, which cannot afford to set up their units in the deltas areas due to their exorbitant costs.
Textile companies might look at areas close to Vijayawada due to its rail and road connectivity only if the fiscal and non-fiscal incentives promised by the government materialize without major hiccups. As on date, the largest investment (Rs 120 crore) made by any textile company in the district is that of NSL Textiles Limited in its state-of-the-art spinning mill at Veeravalli in Bapulapadu mandal and there are at least 10 other industries with an average investment of nearly Rs 35 crore but none of them is in delta areas.
SOURCE: The Hindu
Five months after Ahmedabad Textile Industry's Research Association (Atira), along with Instut fur Textiltechnik-RWTH Aachen (ITA), Germany set up Innovative and Green Building laboratory - IGB lab for testing and display of Textile Reinforced Concrete (TRC), top companies like L&T and Godrej have approached Atira for collaborations for their upcoming projects. While L&T wants to build jaali structures and houses for its officials using TRC, Godrej Group is in talks for various projects.
Textile reinforced concrete is a type of reinforced concrete in which the usual steel reinforcing bars are replaced by textile materials. Instead of using a metal cage inside the concrete, this technique uses a fabric cage inside the same. Atira is also going to order Rs 3.5 crore bi-axially warp knitting machine from Germany to enhance the capability of IGB lab. Also the Union ministry of textiles has sanctioned Rs 3.9 crore for TRC testing and awareness. Initially, Atira had also worked with Ultratech Cement for the testing of TRC made products in Indian conditions.
According to experts, TRC is 80% lighter than fibre reinforced composite (FRC) and also stronger. "In last few months, Atira has also developed further refinements in technology and come out with wall panels made of TRC which is 40% cheaper than conventional brick wall," said Dr Md Safikur Rahman, assistant director, Atira. Mohit Raina, Indian coordinator for German partners in IGB lab, said: "People in building industry are still conservative. There is a lot of potential for new materials such as TRC. Apart from regular construction, TRC can be used as functional material as well."
A Mumbai-based company is into marketing and production of TRC products and is also working closely with Atira. It is currently developing modular toilets for a US-based company's CSR project. "These toilets are made of TRC and glass fibre reinforced concreted (GFRC) which will be made in factory and installed on site," said Raina. Mumbai-based real estate player Malpani Group is also planning to use street furniture made of TRC for its upcoming projects. TRC can also be used for curved structures and in comparison to FRC, it gives extra carpet area to builders. However, the TRC technology will still need approvals from rating agencies before it is used for housing projects.
SOURCE: The Times of India
Emerging economies like India have to work towards reducing vulnerabilities in their economies, said Reserve Bank of India (RBI) Governor Raghuram Rajan. Lower interest rates and tax incentives can boost investments, he said, but consumer demand holds the key for economic growth. "Emerging economies have to work to reduce vulnerabilities in their economies, to get to the point where, like Australia or Canada, they can allow exchange rate flexibility to do much of the adjustment for them to capital inflows," said Rajan in his speech to the Economic Club of New York. However, it takes time to develop the required institutions. In the meantime, the difficulty for emerging markets in absorbing large amounts of capital quickly and in a stable way should be seen as a constraint, much like the zero lower bound, rather than something that can be altered quickly, said the RBI governor. Due to this, he said, even while resisting the temptation of absorbing flows, emerging markets will look for safety nets.
In the past, India has been attracting large foreign flows in domestic markets. "We also need better international safety nets. And each one of us has to work hard in our own countries to develop a consensus for free trade, open markets, and responsible global citizenry. If we can achieve all this even as the recent economic events make us more parochial and inward-looking, we will truly have set the stage for the strong sustainable growth we all desperately need," Rajan said. Rajan also nudged international organisations like the International Monetary Fund to re-examine the "rules of the game" for a responsible policy. "No matter what a central bank's domestic mandate, international responsibilities should not be ignored. The IMF should analyse each new unconventional monetary policy (including sustained unidirectional exchange rate intervention), and based on their effects and the agreed rules of the game, declare them in- or out-of-bound," he added.
According to Rajan, the current non-system in international monetary policy is a source of substantial risk, both to sustainable growth and to the financial sector. "It is not an industrial country problem, nor an emerging market problem, it is a problem of collective action. We are being pushed towards competitive monetary easing and musical crises." There is a need for stronger well-capitalised multilateral institutions with widespread legitimacy, some of which can provide patient capital and others that can monitor new rules of the game, said Rajan. The governor said industrial countries should export to emerging markets as a way to bolster growth. This is because they have done so in the past, too.
SOURCE: The Business Standard
Get ready to pay 14 per cent service tax from June 1. The Finance Ministry has notified the date for the higher rate, which was announced in the Budget. The 14 per cent rate will be inclusive of an education cess. At present, the basic rate is 12 per cent and education cess is levied at the rate of 3 per cent of the basis tax, which takes the total rate to 12.36 per cent. Service tax is levied on all services except those in the negative list. Over half the services that attract service tax also have abatement, which means that the tax will be levied only on a portion of the total value. There is no change in the abatement rules. With no change in abatement, the percentage of value to be taxed will remain the same, but the effective rate of tax will go up. For example, air- conditioned restaurants are to charge service tax on 40 per cent of the bill amount, which works out to Rs. 4.94 on a bill of Rs. 100. This will rise to Rs. 5.6 from June 1.
SOURCE: The Hindi Business Line
A year ago, the term ‘Modified Expectations’—the title of Crisil’s assessment of the government and economy in the first year of the Modi government—meant people had begun to revise upwards their growth forecasts. Unfortunately, despite a windfall gain from falling oil and other commodity prices, the government’s efforts to kick-start growth has only been partially successful, which is why Crisil is calling for tempering expectations of a quick turnaround, or ‘modified expectations’. What is adding to the stress is the weather; unseasonal rains, earlier this year, on the back of a sub-normal monsoon last year, have damaged the crop resulting in distress in the farm sector and the possibility of more to come should the monsoon be deficient as per the Met’s first forecast.
Crisil’s prognosis is that while the Modi government is doing enough to address policy paralysis, by fast-tracking decision-making and enhancing the ease of doing business, these aren’t sufficient to push up demand in the short-term. While pump-priming is a usual solution in such a situation, Crisil points out that this is not possible with the fiscal discipline being observed and, thanks to a hawkish central bank, rate cut-driven consumption is not too much of a possibility either. Programmes like Make-in-India, intended to boost manufacturing and absorb the large numbers entering the workforce each year, will take a long time to have an effect. Unlike standard macro-projections, Crisil also uses results from its credit-ratings database and stresses on the very poor quality of corporate balance-sheets that prevent a step-up in private investment for at least another year—it is the fall in private corporate investment, primarily, that is responsible for the fall in overall investment levels. One big reason for this is that given there is so much surplus capacity and visibility on demand is poor—capacity utilisation in cement is just 71% and 63% in the case of automobiles; of 411 companies analysed by Crisil in the CNX500, nearly 70% underperformed even nominal GDP growth in the first 9 months of FY15 due to lack of demand. Crisil points out that the value of debt downgraded continues to outstrip that being upgraded; and the heavy burden of debt will continue to constrain companies from investing.
The silver lining is that the slight uptick in consumer demand could well sustain, thanks to an increase of R1.4 lakh crore in spending power with households in the current year, resulting from lower fuel prices, benign food inflation and growing incomes—Crisil has extrapolated the savings number from the average inflation levels over the past few years in fuel and food. Crisil reckons the money might be spent on discretionary items, if consumers are confident of the economy getting stronger—in any case, it argues, the returns on savings aren’t that high. Given the low 1.1% agriculture growth in FY15, Crisil’s view is a normal monsoon will give a boost to agriculture in FY16, and that will take GDP up to 7.9% in FY16 as compared to 7.4% in FY15. If the monsoon is deficient, FY16 growth will be the same as in FY15. Even when Modi won the elections, it was always clear cleaning up the UPA’s mess would take a few years. But if banks and India Inc are not able to clean up their balance-sheets in the next year—and that depends upon how the debt tribunals work and if banks are able to pressure firms to sell assets to retire debt—it is not certain private corporate investment will revive significantly in FY17 either. The Modi government, as Crisil says, has identified the major issues correctly, but will have to do a lot more than it has so far.
SOURCE: The Financial Express
Given the slowdown in rural wages—wages grew by 3.8% y-o-y in November 2014 as compared with the 20%-plus levels of 2011—it is not surprising that rural demand is also slowing. That is evident in the results of various companies like Dabur that have a strong rural component. Indeed, data from AC Nielsen shows that while rural demand rose 13.2% in FY14, it grew by a slower 11.3% in FY15. Not surprisingly, there has been a call for increasing support prices for crops, for greater spending on MGNREGA, and greater increase in government spending. Certainly, greater government spending will help, and will take place, since there was an extraordinary squeeze in spending in the fourth quarter of last year to meet fiscal targets—to the extent government spending improves, so will rural demand. MGNREGA in itself is unlikely to help since, with R31,000 crore of spending in FY15, it constitutes a very small share of overall rural incomes—the greater kick to rural demand is likely to come from roads and irrigation projects. Increases in support prices sound attractive, but are not possible either. In the case of wheat, for instance, Indian prices are pretty near global levels if not actually higher—so, all that higher prices will do is to add to FCI’s buffers; higher MSPs will also add to inflation levels.
Indeed, while it is true that India lives in its villages, a larger proportion of people in villages today survive on non-farm income than ever before. The National Sample Survey Organisation’s Situation Assessment Survey of Agricultural Households conducted during January-December 2013 found that over 60% of rural India does not depend on agriculture for its sustenance. Of 156 million rural households, 90.2 million (57.8%) are agricultural households. Of that only 61 million households (68.3%) mentioned farming as their principal source of income. A Credit Suisse report also pointed out that 60% of all industrial production takes place in rural India; three-fourths of all new factories set up in India in the last decade, Credit Suisse pointed out, were set up in rural India. In other words, if rural demand is to pick up, it can only do so when there is an overall increase in investment levels and industrial activity across the country. Bharat can no longer grow unless India does.
SOURCE: The Financial Express
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$ 63.01 per barrel (bbl) on 19.05.2015. This was lower than the price of US$ 64.79 per bbl on previous publishing day of 18.05.2015.
In rupee terms, the price of Indian Basket decreased to Rs 4013.11 per bbl on 19.05.2015 as compared to Rs 4117.40 per bbl on 18.05.2015. Rupee closed weaker at Rs 63.69 per US$ on 19.05.2015 as against Rs 63.55 per US$ on 18.05.2015. The table below gives details in this regard:
|
Particulars |
Unit |
Price on May 19, 2015 (Previous trading day i.e. 18.05.2015) |
Pricing Fortnight for 16.05.2015 (April 29 to May 13, 2015) |
|
Crude Oil (Indian Basket) |
($/bbl) |
63.01 (64.79) |
64.51 |
|
(Rs/bbl |
4013.11 (4117.40) |
4115.09 |
|
|
Exchange Rate |
(Rs/$) |
63.69 (63.55) |
63.79 |
SOURCE: PIB
The State Bank of Pakistan (SBP), against the businessmen’s claims, believes that the structural issues are the primary cause behind weak textile exports instead of energy constraints and security risks. In a second quarterly Fiscal Year 2014-15 (FY15) report, the SBP while pointing out the unimpressive performance of textile industry, said, “As for the supply side, businessmen cite energy constraints and security risks as being the major issues hurting exports. However, in our opinion, this is only partly true.” “The fact remains that unless we settle structural issues facing Pakistan’s textile industry, it will not be able to consolidate its position in the international market,” the report added.
The central bank also reported that textile exports posted a 0.4 percent decline in first half of FY15 as compared to the same period last year. The SBP attributed this decline primarily from low value-added items: the decline in export of cotton yarn and fabrics more than offset the increase in export of knitwear, woven garments and towels. The export of cotton fabrics to China, Bangladesh and Turkey remained particularly low, as these countries are facing sluggish demand from their importers.
On the contrary, export of value-added items like knitwear and readymade garments benefited from the availability of GSP Plus status in the European Union. However, All Pakistan Textile Manufacturer Association (APTMA) Chairman SM Tanveer disagreed with SBP and said that undoubtedly energy constraints and security risks are the prime factors that badly affected textile sector’s performance. He said in the absence of any supportive textile policy, the industry is being faced ‘structural issues’ and due to unavailability of friendly tax structures there is no such relief for the industrialists to upgrade their textile units as per global standards while the government seems not interested to cater the textile industry issues.
Instead of facilitating the sector, government is imposing 30 percent or Rs 200 per mmbtu Gas Infrastructure Development Cess (GIDC) on the domestically produced gas that will cause massive closure while 30 percent operational capacity is already closed, he added. Tanveer said that the Pakistani textile industry has been operating with 10-year-old machinery that needs to be upgraded, whereas India, which lagged behind 10 years ago, now has gone far beyond from Pakistani textile sector owing to its government’s support. He said, “If the government properly patronised the industry, we have the potential to convert our current value added exports of Rs 5 billion into Rs 15 billion per year.” He said the Pakistani textile sector is in dire need to be modernised to meet the international requirements, in fact which is not possible without the government’s help as he demanded the duty structure should be relaxed so that manufacturers can import the latest machinery, otherwise we cannot utilise complete GSP Plus status benefits, he added.
SOURCE: The Daily Times
Pakistan Businessmen and Intellectuals Forum (PBIF) President Mian Zahid Hussain has asked the government to announce special incentives package for the Small and Medium Enterprises (SMEs) sector in the next budget. He said that the sector having 40 percent share in the GDP, 30 percent share in exports and providing employment to thousands of people could not be ignored. Speaking to business community here on Tuesday, he said that out of 3.5 million SMEs in Pakistan, 65 percent were located in Punjab while slightly over 2 percent were in Balochistan, which could be balanced through policy interventions. He said that law and order, energy crisis, lack of regulatory support, incoherent laws, deficiency of market information and skilled labour besides want of finances were the main reasons behind lacklustre performance of the SME sector.
Mian Zahid said that defaults compelled lenders to rethink SME financing, as the default ratio of corporate sector stood at 13 percent. He noted that textile and garments sector had emerged as a biggest defaulter which failed to meet 50 percent of its financial obligations. He also called for reviving textile sector, which was finding it difficult to compete with China, India, Bangladesh and Vietnam, besides the spinning capacity of the country had declined by 30 percent, enough to catch the attention of the policymakers. Mian Zahid asked the banks to revisit their policy of ignoring SMEs and chalk out an effective plan to develop this critical sector to reduce poverty and unemployment in the country.
SOURCE: The Business Recorder
Export earnings from the Turkey market dropped by 19.50 per cent to $581.25 million in the first 10 months of the current fiscal year due to a devaluation of the euro as well as the Turkish currency lira, dashing the exporters’ hope of getting another billion-dollar-market. Bangladesh’s export earnings from Turkey in the July-April period of the financial year 2013-14 were $722.12 million, according to the Export Promotion Bureau data. Following the imposition of safeguard duties by Turkey on readymade garment imports from Bangladesh, country’s (Bangladesh’s) export earnings had witnessed a drastic fall in the FY 2011-12. Export earnings in FY12 had decreased by 64.26 per cent to $258.90 million against $724.45 million in the FY11, data showed. Overcoming the hassle of safeguard duties, Bangladesh’s exports rebounded in the Turkey market in the FY 2012-13. In the FY 2012-13, the export earnings from Turkey grew by 146.35 per cent to $637.81 million from $258.90 million in the FY12.
The earnings in the FY 2013-14 increased to $856.19 million and the exporters expected that Turkey would be a billion-dollar-market in the FY 2014-15. According to the EPB data, the export of RMG, the major product, to Turkey in the first 10 months of the financial year 2014-15 decreased by 25.95 per cent to $388.04 million against $524.02 million in the same period of FY 2013-14. Anwar-Ul-Alam Chowdhury Parvez, managing director of Evince Garments Ltd, said the domestic consumption in Turkey decreased a bit due to a fall in the value of euro. In last one year, the Turkish currency lira depreciated by 2 per cent against the euro and about 20 per cent against the dollar that increased cost in import for the country, he said.
Parvez, also a former president of Bangladesh Garment Manufacturers and Exporters Association, exports shirts to Turkey. ‘Amid the depreciation of local currency, Turkey usually will prefer local production to import,’ he said. ‘Despite having potentials in the Turkey market, our export witnessed a negative growth in the market due to depreciation of euro as well as lira,’ said Faruque Hassan, managing director of Giant Group. He said that due to devaluation of local currency production cost in Turkey became cheaper than import and so the country started to utilise their capacity in production. Depreciation of euro is one of the reasons for the negative export growth in Turkey as the payments between Bangladesh and Turkey are settled in euro, said Faruque, also a former vice-president of the BGMEA.
SOURCE: The Global Textiles
Dhaka and Moscow could not form a Joint Trade Commission (JTC), although nearly two and a half years have elapsed since Prime Minister Sheikh Hasina's visit to Russia in January 2013, officials said. During the visit, the two countries agreed to set up the body intended to facilitate bilateral trade. Since then, Russia has given reminders several times, but the issue remained pending with the ministry of foreign affairs, they said. Earlier of the month, Moscow imposed a temporary ban on potato imports from Bangladesh, citing the presence of harmful bacterium Ralstonia solanacearum in some Bangladeshi consignments.
Trade officials said if there were a platform, the two nations would have had scope for discussing the matter and finding out an amicable solution to trade-related disputes. "The issue of formation of the commission remained pending with the foreign ministry. We will soon write to the ministry again requesting to form the body," commerce minister Tofail Ahmed told the FE. He said formation of the commission will help facilitate bilateral trade. He cited the example of ban on potato imports from Bangladesh, saying this kind of body would have allowed both sides to discuss trade disputes. Sources said the Russian ambassador in Dhaka Alexander A Nikolaev has recently sent a letter to agriculture minister Matia Chowdhury and informed about the restriction. Matia handed over a copy of the letter to commerce minister Tofail Ahmed, requesting him to immediately sign an agreement for formation of JTC with Russia. Earlier in April, the Russian ambassador in a meeting with the agriculture minister had also asked for the formation of a JTC.
A senior official at ministry of commerce (MoC) said Russia is interested to form a JTC with Bangladesh and it had forwarded a draft of an agreement to the ministry of foreign affairs. He said six months back, Bangladesh embassy in Moscow in a letter to the MoC informed about Russia's willingness to form the JTC. The MoC convened an inter-ministerial meeting to discuss the issue and requested the MoFA to complete the formation of the commission. However, he said, no visible progress was made since then. According to officials, in fiscal year 2013-14 Bangladesh exported potato worth US$34 million to different countries, with Moscow alone importing the produce valued at $9.0 million. During the year Bangladesh exported 116,000 tonnes of potato, of which 20,000 tonnes found its way to Russia. The two-way trade between Bangladesh and Russia reached nearly $600 million in fiscal year 2013-14, while Dhaka's export of goods to Russia was $283.35 million and import amounted to $286.4 million. Bangladesh mainly exports knitwear, woven garments, jute yarn and twine, raw jute, leather goods, and frozen shrimps to Russia while its import includes fertiliser, metal-roll, and raw materials for the textile industry.
SOURCE: The Financial Express Bangladesh
Twenty years ago, when President Bill Clinton was urging Congress to enact sweeping trade legislation over objections of important constituents in his own party, the face of the opposition were the middle-aged (and beyond) white, male leaders of the AFL-CIO. For President Barack Obama, the dynamic may feel the same—trying to find enough Democrats to help Republicans pass a trade deal—but the coalition is a lot broader. In addition to labor, the president is being opposed by teachers, seniors, Internet freedom groups, and Sister Simone Campbell. Once the Senate approves fast track trade negotiating authority for Obama, which could happen as early as this week, the battle will move to the House, where it expected to unleash a major lobbying battle. On the one side, a president who is more engaged in legislative trench warfare than he has been in a long time over legislation that would give him authority to establish the Trans-Pacific Partnership. “This is personal for him,” Representative Jan Schakowsky of Illinois, a member of the Democratic House leadership, told Bloomberg reporters and editors. On the other: a coalition of opponents that is far more diverse than the one that tried unsuccessfully to torpedo Clinton's North American Free Trade Agreement with Mexico and Canada, the first of several trade pacts struck since the 1990s that critics say have cost U.S. jobs and depressed wages.
The newcomers to the fight say they are there because they have seen the results of the earlier trade agreements and now know better. “NAFTA really caught a number of folks off guard,” said Laura Peralta-Schulte, a lobbyist for NETWORK, Sister Simone's national Catholic social justice lobby. Sister Simone became a national figure in 2012, when her Nuns on the Bus campaign opposed the House Republican budget. Now, she's fighting the White House, part of a faith coalition that includes 47 different organizations opposed to the trade deal, according to Peralta-Schulte. She cited concerns over the secrecy of trade negotiations and the impact on marginalized communities, including populations in Malaysia targeted by human traffickers. “The assumption is you have a trade agreement and something magically lifts standards, but as we've seen in other countries like Colombia, that's not the case,” she said.
Unions remain a backbone of the opposition to the TPP. The United Steelworkers and United Auto Workers unions are among those who've organized plant demonstrations, and the UAW is mobilizing retired auto workers. The AFL-CIO has been leafletting, including in the states and districts of lawmakers like those of Senator Ron Wyden, the chief Democratic negotiator on trade. “This particular agreement is likely to be the last multilateral trade agreement in a generation,” and it “does nothing really more on labor and the environment than previous agreements,'” said Bill Samuel, AFL-CIO director of government affairs. This time around, however, labor is now joined by a disparate—yet politically formidable—coalition.
Among the most active groups are environmental advocacy organizations like the Sierra Club, which made more than $1.6 million in contributions to congressional candidates during 2014, according to the nonpartisan Center for Responsive Politics, and last year spent some $360,000 lobbying Congress. The group has held rallies and phone banks and is running online and radio ads. It says expanded trade opens the door to more hydraulic fracturing and other practices that harm the environment. The Pacific agreement would also allow foreign corporations to sue countries whose policies they believe undercut profits, mainly oil and gas companies targeting environmental regulations.
The Electronic Frontier Foundation, a digital rights organization concerned about free speech and Internet copyright provisions threatening users' rights, says its 22,000 members have been e-mailing and tweeting at their representatives. EEF has had success with such campaigns before: It was one of the organizations that helped bring down the Stop Online Piracy Act despite bipartisan support for the bill designed to crack down on violation of intellectual property rights. Meantime some seniors are worried about the effects of more open markets on drug pricing that could increase their costs. “Foreign corporations or subsidiaries will be able to challenge a number of public programs,” including those providing Medicare drug discounts, the Alliance for Retired Americans said in a May 12 letter to the House and Senate. In addition, a group called Food & Water Watch, which is concerned that the agreement will result in increased fracking and what it perceives as a negative impact on local farms, has sent 82,907 messages to Congress and held at least 15 lobbying visits including rallies and press events.
On the other side, there is also a large coalition of business groups, including from the technology, retail and manufacturing sectors. Republican leaders believe a handful of House Democrats will ultimately join with them in granting the president negotiating powers he would use to close a 12-nation Trans-Pacific trade agreement. Yet, with the vast majority of Democrats opposing him, the vote will be uncomfortably close for Obama. But there are no more than 20 Democrats who've publicly expressed support for Obama. In 1993, 102 Democrats voted for Clinton's NAFTA legislation. Compounding his challenges, Democrats say, is a strained relationship with many lawmakers in Obama's party that makes it harder for the Cabinet-level outreach strategy he's deploying to be as effective as Clinton's was around NAFTA. While California Representative Loretta Sanchez, a Democrat who plans to oppose the legislation, says “I see more effort” by the White House on this issue than on others, she doesn't think the president has enough political capital for it to pay off. “When you don't have a relationship with the membership, it's really difficult to come in at the last minute to say 'do this,'” said Sanchez, a member of the New Democrat coalition of moderates in the House.
The White House says the deal would expand opportunities for U.S. workers, farmers, ranchers, and businesses by giving them access to some of the biggest emerging markets. Opponents say the negotiations have inadequate protections for workers and the environment and cover a range of issues beyond any previous accord, including access to medicines, financial regulations, and food-safety measures. “It's not just the interest groups, it's the issues that run deeply,” said Michigan Representative Sander Levin, the top Democrat on the House Ways and Means Committee. Representative Luis Gutierrez, an Illinois Democrat who was a freshman lawmaker in 1993, said whatever outreach Obama is conducting pales in comparison to that of Clinton's administration. He recalled former Chicago Mayor Richard Daley creating such stress during an arm-twisting session that Gutierrez was driven to smoking a cigarette. Daley's brother, Bill, was leading the White House effort to win the legislation.
Clinton operated a war room targeting Democrats who might support his bid, romancing potential supporters and punishing those who refused him. Following his smoking session, Gutierrez was also offered by Bill Richardson, then a New Mexico congressman close to the White House, an unrelated role leading “a national crusade on citizenship” for immigrants in exchange for his support, said Gutierrez. “It was very intense lobbying,” he said. Gutierrez, who represents a heavy manufacturing district, was noncommittal. Later, he announced his opposition to NAFTA before boarding a flight to Washington to meet with Clinton. Upon landing, he was informed there was no reason to come to the White House. In the end, Clinton got 102 Democrats, including the future House speaker, Nancy Pelosi, to back NAFTA. By contrast, today “nobody's come to me and said, 'Hey, what is it going to take?'” said Gutierrez.
SOURCE: The Bloomberg
In April 2015, Asian ethylene-naphtha spread hit a record high amid bullish ethylene markets. The spread jumped US$193 during the month on an average as ethylene prices were under pressure of tight supplies. The CFR Northeast Asia ethylene marker averaged US$1,368-1,370 a ton while the Southeast marker averaged US$1,423-1,425 a ton, both increasing US$214-240 on the month. The spread was over and above the US$269 a ton recorded in March. Meanwhile, the CFR Japan naphtha prices averaged US$551 a ton, up US$21 from March, thus expanding the spread. Seeing the jump in Asia, European spread also jumped US$182 a ton in April to US$708 a ton. US was slower in April with spread shrinking US$32 a ton to US$236 a ton. Compared to a year ago levels, the spread were up 60-67 per cent in Asia and Europe and down 37 per cent in the US.
Asian ethylene prices started climbing in early February and hitting a six-month high of US$1,429-1,431 a ton CFR NEA in the last week of April, driven by supply tightness emanating from steam cracker turnaround season in the second quarter. In South Korea alone, three steam crackers were out of the eleven scheduled for shutdown in Q2 for annual maintenance. This implies that around 35 per cent of South Korea's total ethylene capacity will be shut. To top it, several other unplanned steam cracker outages are reported in the region.
The bullish run in Asian ethylene market has opened the arbitrage window from the US to Asia and around 30,000 ton of spot ethylene is been fixed for May to July delivery. Another 4,300 ton spot cargo would arrive in Northeast Asia in July from Mexico. Despite many deep-sea cargoes arriving in Asia, ethylene markets still remained strong as spot demand was healthy amid positive margins for styrene monomer production. Asian ethylene markets are likely to remain firm until the end of June.
SOURCE: Yarns&Fibers
