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Monday, 12 November 2018 13:42

Global organic cotton output up 10 per cent

Global organic cotton output rose by 10 per cent in the 2016-17 season. The largest volumes came from India, China, Turkey and Kyrgyzstan. While organic still occupies less than one per cent of global cotton production, many countries have growth in the double-digits.

A huge area of cotton-growing land is in transition to organic. About 80 per cent of this transition is taking place in India, with the remainder stemming primarily from Pakistan, China, Tanzania, and Turkey.

However, after hitting a production peak in the 2009-10 season, the sector failed to kick in, and it has been pretty much downhill all the way since then, while other certification schemes such as BCI cotton have flourished.

While organic cotton undoubtedly has positive connotations with consumers, it is more expensive to grow with more variable yields, making it much more difficult to get to market at a profitable price point.

Organic cotton is not necessarily economically viable. There is no disputing the fact that the organic cotton market has struggled to maintain any significant momentum in recent years. Indeed, it often feels like a case of two steps forward, three steps back. Cotton’s share in fiber use has dropped from 50 per cent to just over 30 per cent.

Of the 50 countries in the US Chamber of Commerce’s International IP Index, that measures commitment to protect innovation through legal rights, China ranks 25th. The country earns praise in the survey for its reforms on patents and copyright, but loses marks for the high levels of infringement and insufficient legal safeguards.

Brands Nike and LVMH also praised China’s efforts to fight theft of intellectual property including the counterfeiting of major brands, as justification for imposing tariffs on Chinese imports at the China International Import Expo in Shanghai. Both companies saw a surge in sales from China as affluent consumers embrace high-end brands. Nike’s annual revenue from China last year was $5.1 billion, more than doubling since 2013.

Government crackdowns on sophisticated counterfeiting rings in Southern China’s Guangdong province prevented exports of fake Louis Vuitton bags to Dubai and the US.

 

Monday, 12 November 2018 13:39

Lenzing revenue down five per cent in Q3

For the first three quarters Lenzing’s revenue decreased 5.2 per cent over the comparative period of the previous year. Ebitda fell 26.8 per cent. The Ebitda margin dropped from 23 per cent. Ebit fell by 36.2 per cent, leading to a lower ebit margin of 11.6 per cent. Net profit dropped by 39 per cent.

For the first three quarters Lenzing had a focus on specialty fibers. The decline in revenue and earnings compared with the same period of previous year was essentially based on a mix of lower prices for standard viscose, more unfavorable exchange rates and price increases for key raw materials.

Lenzing is currently operating in a challenging environment. The group will put all its effort to readjust the execution of its growth plan to meet the strong market demand for its lyocell fibers. This includes an increased focus on the lyocell expansion project in Thailand.

After the introduction of Tencel Luxe branded lyocell filament yarns in the previous year, Lenzing continues to drive innovations in the area of the value chain. In September, the company also announced the successful development of the Lenzing web technology, a new technology platform focusing on sustainable nonwoven products, which will lead to new market opportunities for the industry.

 

Monday, 12 November 2018 13:38

LLF awarded the 4th CarbonNeutral status

Leading high-end leather garment manufacturer, Lanka Leather Fashion (LLF), was awarded CarbonNeutral® status for a fourth consecutive year by the independent sustainability verification, validation, and assurance body – The Sustainable Future Group (SFG).

With the assistance of The Carbon Consulting Company (CCC) — Sri Lanka’s leader in Integrated Sustainability Solutions – LLF underwent a comprehensive assessment of their organisational greenhouse gases (GHGs) to determine its environmental impact. The impact was then compensated for through the reinvestment in a renewable energy project in the Ratnapura and Kandy districts of Sri Lanka, in return for registered Carbon Credits to match their Carbon Footprint.

LLF introduces diverse initiatives to tackle social and environmental issues within the workplace and communities in Sri Lanka. Through the introduction of new technologies and adaptation of newer, greener and more efficient business practices, LLF has been able to continuously lower its operational expenses and enhance employee engagement. From using discarded leather waste to create new products for clients to joining forces with a local fashion designer to create upcycled leather jewellery, LLF is helping create a sustainable culture within its communities.

 

Monday, 12 November 2018 13:36

Kors targets $2bn in revenue in five years

Michael Kors is looking to increase its revenue from the current$850 m to$2 billion in the next five years. The company will build on Versace's luxury runway momentum, starting with the recently announced New York Show on December 2.

It will also enhance the brand's powerful and iconic marketing, adding significantly to the company's spend next year; increase its global retail footprint with around 30 new stores next year; accelerate e-commerce and omnichannel development; and expand the accessories and footwear business with new products that will be introduced for fall of next year.

The company also has big plans for both Jimmy Choo and Michael Kors brands. It believes that Choo can achieve its $1bn revenue target having grown its store base to over 200 from 150 when it acquired the business a year ago.

 

Vietnam's textile exports are expected to rise by 14.8 per cent to $35 billion in 2018. The country’s textile exports to the United States rose by 12 per cent over the January-October period to $10.5 billion, while exports to China increased 40 per cednt, to $ 1.1 billion. During the first eight months of the year, foreign investment in textile and clothing sector was $2 billion. Most of these investors come from Japan, South Korea, Taiwan and China.

While they are two thirds smaller than those destined for the United States, textile exports to Europe remain important for Vietnam. According to the French Institute of Mode (IFM), the country was last year the sixth supplier of the European Union in clothing with €3.1 billion of goods, as well as its 13th textile supplier with €370 million. For France, Vietnam is the seventh supplier of clothing with €819 million, behind Tunisia and Morocco, but ahead of Cambodia and Portugal.

 

Monday, 12 November 2018 13:33

Kitex Q2 profit up eight per cent

For the second quarter Kitex Garments’ profits rose eight per cent. Revenue witnessed a 20 per cent jump. Total revenue for the half year ended September 30, 2018, stood at Rs 313 crores as compared to Rs 282 crores a year ago while net profit was at Rs 45 crores for the first six months as compared to Rs 42 crores a year ago.

Kitex, based in Kerala, is one of the largest apparel manufacturers of infant wear in the country and exports about 95 per cent of its infant wear. These are mainly to the United States and Europe. The company also engages in contract manufacturing for private labels such as Jockey, Carter, Babies R Us, Gerber, and Mothercare.

The company has been allotting regular capex for improvement of technology and infrastructure and is in the process of upgrading its current facilities so as to expand its capacity. The facility in Kerala covers an area of 1,80,768 sq ft, one of the largest in the world under one roof. The growth strategy includes revenue enhancement, horizontal product diversification, capacity augmentation and vertical integration. Kitex hopes to grow between 20 to 23 per cent a year over the next seven years.

 

Monday, 12 November 2018 13:32

Getting creative with denim

The denim supply chain is pushing boundaries. Ambivalence toward going green doesn’t hold up anymore. While all companies are focused on getting product to market, they are being urged to add a sustainable lens to their focus. And employees across all levels of a company are responsible to spark that change.

Business leaders are being encouraged to think creatively. One idea is to put a wetland next to a factory. A living ecosystem next to a factory environment means the two things—manufacturing and biology—intersect. A natural system acts as a filtration device for wastewater treatment. This may seem like a farfetched vision but the technology and knowhow exist.

There’s a lot of technical elements but there is the opportunity to overcome the technical challenge and create the traceability that consumers are demanding. Draping, off-the-shoulder and conceptual cutouts elevate denim. Workwear details and A-line silhouettes add structure. Oversized twills, linen, summer blanket materials with a handloom look, feminine quilting and patchwork jacquard add texture and visual interest.

Camouflage and ikat prints offer an outdoorsy feel. Brands can recreate these dye effects through laser printing for a more sustainable solution. The story’s color palette—soft indigos, natural indigos and natural vegetable shades—are well-suited for brands’ eco stories as well.

With growing Chinese textile industry, Chinese textile machinery import figures were larger than exports, but since 2012, machinery exports have overtaken imports. In China, there are more than 100 knitting machine producers. These companies are now selling hi-tech technologies in knitting. About 15 to 20 per cent of the textile machinery produced in China is exported. There are some companies which export around 50 per cent of their production.

The Chinese textile industry offers textile machinery at most competitive prices. Indian companies have expressed interest in Chinese textile machinery, because the price is very competitive. For example, a knitting machine offered by European companies is double the price supplied by Chinese companies of nearly the same technology. European companies have been in business for several decades and Chinese companies are trying to catch up.

A lot of innovations are happening in the Chinese nonwoven machinery sector. The Chinese knitting sector uses hi-tech technologies. The China Textile Machinery Association has 600 members who are manufacturers of textile machinery and spare parts. CTMA also has foreign companies as members who have set up offices and factories in China. To enhance the country’s position in the global value chain, China has drawn up a roadmap to upgrade industries through innovation.

The Central government is in the process of introducing alternative schemes to promote exports which would improve competitiveness. It recently introduced a package for the MSME sector which increased the interest subvention on pre-shipment and post-shipment finance for exports to 5 per cent from the earlier 3 per cent.

Under this package, GST- registered MSMEs would get 2 per cent interest rebate on incremental loan up to Rs 1 crore. Improvement in India's ranking in the World Bank's Ease of Doing Business will help boost exports. The results of this for textiles exporters, remarkable improvements are visible at the ports, customs and regional offices of DGFT EDI systems.

According to Texprocil, India's cotton textile exports grew by 26 per cent to $6,235 million in the first six months ended September 2018. The country exported cotton textiles (raw cotton, yarn, fabrics and made-ups) worth $4,917 million in April-September 2017-18. However, exports of textiles and clothing declined by 3 per cent with exports of readymade garments registering a steep decline of 16 per cent during H1FY19.