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Global buyers are interested in sourcing cotton from India as they find it cost effective and less expensive compared to other countries. Apart from neighboring countries, India has been receiving demand for cotton from several other countries, including Vietnam and Indonesia.
Bangladesh, the world’s largest cotton importer, does not have much of its own production and its spinning mills largely depend on imports.
In the first six months of this cotton production and marketing season, India sold 55 lakh bales of cotton, of which 17 lakh bales were shipped to Bangladesh, followed by 11 lakh bales to Pakistan, ten lakh to Vietnam, seven lakh to China, seven lakh to Indonesia and Taiwan, and three lakh to other countries including Sri Lanka, Turkey and Thailand.
India is the largest producer of cotton in the world, followed by China, the US, Pakistan and Brazil. The five largest exporters of cotton are the US, Australia, Brazil, India and Uzbekistan. Five major consumers of cotton are China, India, Pakistan, Bangladesh and Turkey.
India will export 65 lakh bales to 70 lakh bales of cotton in the ongoing cotton season. The country exported 63 lakh bales of cotton last year.
By the end of the season, India’s cotton exports to China may touch ten lakh bales.
"Till some years ago, producing clothes in a span of six weeks was a distant dream or rather a challenge. Thanks to fast fashion, this has become a reality today for apparel manufacturers and retailers. And as, Spencer Fung, CEO, Li & Fung, opined in the last couple of years, people started realising they have to speed up. One of the reasons is the consumer has really sped up. And it’s now noticeable if you don’t speed up, you’re dead. It has become possible for the US retailers to match up to the fast-fashion prowess of European competitors such as Inditex SA and H&M. These companies are known for pioneering the fast fashion model by taking flexibility to the extreme, via airlifted merchandise, small order sizes and an accelerated design process."
Till some years ago, producing clothes in a span of six weeks was a distant dream or rather a challenge. Thanks to fast fashion, this has become a reality today for apparel manufacturers and retailers. And as, Spencer Fung, CEO, Li & Fung, opined in the last couple of years, people started realising they have to speed up. One of the reasons is the consumer has really sped up. And it’s now noticeable if you don’t speed up, you’re dead. It has become possible for the US retailers to match up to the fast-fashion prowess of European competitors such as Inditex SA and H&M. These companies are known for pioneering the fast fashion model by taking flexibility to the extreme, via airlifted merchandise, small order sizes and an accelerated design process.
Recent revelations
With consumers moving from one fashion trend to another faster than ever, US retailers are collectively being pushed to get away from traditional model, which values low costs above all else. Gap Inc., for example, uses a technique called fabric platforming, where it holds a large amount of material and designs specifically for those textiles. This has allowed it to slash lead times by about a third to 11 weeks or less. American Eagle Outfitters Inc. has sped delivery times by moving some production into the Western Hemisphere, despite wages that are generally higher than those in Asia. Similarly, Kohl’s uses all of the above and also runs smaller test orders, which can be ramped up quickly if demand is brisk.
Other retailers have invested significant time in cutting costs by moving production to Asia and placing massive orders for merchandise. Now, they aren’t in the best position to enact broad changes to their supply chain as foot traffic at physical stores declines and US consumers spend less of their income on apparel. Given this changing scenario, Kohl’s is being watched closely as companies are contemplating whether the extra investment will actually pay off. Kohl’s says, it has indeed unlocked the secret. Last quarter, brands that are part of the company’s speed initiative outperformed comparable products by about 2.5 percentage points. While fast-turnaround products made up 40 per cent of orders in 2017. Wilson, whose company is located in Syracuse, New York, also makes clothing for retailers like American Eagle and J.C. Penney Co, says the typical Kohl’s order is now for 80,000 shirts, instead of 500,000. This helps prevent buildup of unpopular merchandise and markdowns if a particular product fails to resonate with shoppers.
Market dynamics
Moving towards fast fashion isn’t simple either because most US retailers depend on suppliers, while a company like Zara is vertically integrated, which allows it to have more control from start to finish. Li & Fung, a 20-year partner of Kohl’s, is in the middle of a three-year plan to cut lead times by half and digitise its global supply chain for apparel. Fung says whether its customers want speed or not, they had to move faster as a company because they see the whole world moving faster. The first place Fung has sped things up is in preproduction: With 3-D digital designs replacing physical samples, a process that can take six months is carried out in a few days.
With a 13 per cent share, the textile sector is a major contributor to India’s export earnings. However, the sector has been under pressure of late. While, apparel exports having grown at a subdued pace due to intense competiton, yarn exports have also remained under pressure given the decline in demand from China as well as the country’s losing share in the Chinese yarn market.
Adequate budgetary allocation for schemes such as refund of state levies and interest subvention benefits can help improve the competitiveness of textile exporters and improve textile export growth. India is still highly reliant on textile intermediaries for its export earnings, indicating the potential for further value-addition and hence investment requirements in downstream segments, like apparel and home textiles.
A higher budgetary allocation towards the Technology Upgrade Fund Scheme subsidy for 2018-19 would prop up investments in downstream segments, facilitating higher value addition and an even higher contribution by the sector to the country’s GDP as well as forex earnings.
Apparel exports can go up if raw materials and intermediaries currently being exported get processed further into apparel. This has the potential to double cotton-based apparel exports and increase total textile exports from the country by 50 per cent in value terms.
The United States will impose tariffs as high as 25 per cent on some 1,300 products from China. These tariffs are because of what US it deems China’s unfair practices surrounding intellectual property and forced technology transfer. The list, though aimed largely at the aerospace, information technology and robotics industries, includes more than 80 products tied directly to machinery for apparel and textile manufacturing.
Tariffs will be imposed on textile printing machinery, carding machines for preparing textile fibers, textile spinning machines, machinery for producing textile yarns, weaving machines, circular knitting machines, flat knitting machines, embroidery machines, spindles and sewing machines—and many of the parts that go into operating those machines.
As tariffs are often little more than a hidden tax on consumers, prices in the textile and apparel sector could face increases as the new tariffs drive up the cost of doing business. Manufacturers may not be able to absorb a new 25 per cent tariff without passing at least some of the costs on, which could come in the form of higher prices for apparel.
The list doesn’t target apparel and footwear products directly. There will be no tariffs on US imports of apparel, footwear, and travel goods from China.
The past two years have been rough for a number of big US clothing and footwear brands.
Many have regularly struggled to sell the inventory they’ve made, and have fallen back on heavy and endless discounts—sinking their profits. They’ve had to contend with a string of bankruptcies among some of their largest retail partners, along with high-profile store shuttering. Shoppers, meanwhile, are spending less of their money on clothes and seem to only want to buy on sale.
But there are indications that better times lie ahead.
Brands are finally starting to get their inventories under control, which means less need for markdowns. At the same time, returns from investment in direct-to-consumer and international sales are starting to roll in. A weakening dollar is making these companies’ products more affordable overseas. New products and innovations are set to hit the marketplace and the retail situation overall is improving.
Emerging markets, and China in particular, will continue to be a source of growth not only because greater economic expansion helps fuel branded apparel purchases, but also US brands remain relatively underpenetrated, leaving significant white space for growth.
However all this assumes the US puts no tariffs on Chinese imports and that there is no spike in the cost of cotton or the value of the dollar.
Michael McDonald has been chosen executive director of SPESA (Sewn Products Equipment and Suppliers of the Americas). He will work alongside current president Benton Gardner and managing director Dave Gardner until his retirement at the end of 2018. McDonald will take over full management of the organisation in January 2019.
McDonald is currently completing his doctoral degree in textile technology management at North Carolina State University. He was previously with the American Apparel and Footwear Association. He oversaw a diverse array of issues as lead lobbyist including product safety, intellectual property, military contracting, domestic sourcing, environment and chemical management, corporate tax reform, transportation and infrastructure, patent reform, labor, state chemical regulations, international trade, and internet sales tax. McDonald also developed resources and tools to help member companies with regulatory compliance.
Formed in 1990, SPESA is devoted to the advancement of suppliers of machinery, technology, ancillary equipment, parts, services and other solutions for the development, manufacture, and distribution of sewn products. Its members serve the apparel, upholstered furniture, home textiles, transportation interiors, leather goods, footwear, military, technical/industrial textiles and other sewn products segments.
SPESA promotes and coordinates business and social interaction and provides opportunities for the sharing of industry-specific and general business information for its members and their customers.
Augmented and virtual reality are headed towards retail sector. These technologies could prove to be an effective lure for keeping shoppers in stores while also enabling them to shop online.
Zara has released an app that enables customers to watch models walking around the store wearing the latest clothes, then click through and buy what they fancy. Converse, Topshop and Uniqlo use augmented reality apps and make-up behemoth Sephora already offers virtual artist technology where shoppers can use their phones to try on make-up colors and looks before buying.
Ikea too launched an app which allows consumers to experiment with furniture placement and UK cosmetics brand Charlotte Tilbury has installed a magic mirror in its stores which scans shoppers' faces and applies the latest looks without ever trying on any make-up. At the most basic level, virtual and augmented reality technologies can be used to help shop employees find lost stock in the storeroom.
Indeed the role of a physical store and online site can be interchangeable. Retailers that provide consumers with a compelling offer across all formats are growing their business at a faster rate than others. Companies that utilise this modern technology are giving themselves a competitive advantage by creating greater access to their products and giving the consumer an added element of experience.
Mayer, a circular knitting machine manufacturer offers a wide variety of machines. Its Spinit 3.0 E combines spinning and knitting in one machine and what’s more, it saves energy, resources, space and time in producing single jersey fabrics.Mayer is the first manufacturer to merge these two processes that had previously been separate both technically and ideologically.
Normally, yarn is processed into a textile fabric on circular knitting machines of Mayer. The yarn comes from a spinning mill, where it is manufactured in a complex and energy-intensive process. The new Mayer spinning and knitting machine, in contrast, does not wait for the finished yarn to arrive from the spinning mill; it uses roving and is thereby able to combine in one machine, the Spinit 3.0 E, the previously strictly separate processes of spinning and knitting. Several other machines are no longer required, reducing the space required by about a third.
The process takes less time, reducing the amount of energy required to about two-thirds of what the conventional manufacturing process uses, with a positive effect on the carbon dioxide balance. The spinning and knitting machine also helps to save valuable cotton. Leftover roving on the spools is not waste; it can be sent straight back to the spinning mill.
The April edition of Kingpins Transformers Summit is aimed at tackling transparency. The edition, to be held from April 17 in Amsterdam and the following on to be held in New York on June 5th will take on transparency. Past editions have focused on water, industrial waste and chemistry, as the event has sought to inform and inspire those who recognize the need for change in the denim industry. This time, the summit, will be sponsored by Rivet magazine.
The biannual events will host panel discussions amongst industry stakeholders along with interactive sessions with representatives of the fibre, textile, technology, chemical, and machinery sectors of the denim industry. Each daylong event, which will feature transparency panels and speakers, will precede the Kingpins Show in Amsterdam.
The Amsterdam event will take place at Amsterdam-based Westergastheater and will feature leading industry speakers. Transformers founder Andrew Olah, says at present most brands aren’t held accountable for their product components. Transparency is the final obligation by brands and retailers to share all existing information about their products.
Jack & Jones’ new low impact denim collection concentrates on optimising all three elements of denim production: fiber, fabric and finishing. This is achieved through groundbreaking new production methods, technologies and a transparent supply chain.
The fiber composition of the denim collection consists of organic cotton mixed with either recycled cotton or recycled polyester or Lyocell. With an organic fixing agent produced from shrimp shells, the fabric dyeing process has been shortened and now uses up to 55 per cent less water compared to conventional denim dyeing processes. In the finishing process, the Low Impact Denim collection is completed through more sustainable treatments. Methods that minimize the need for water, energy and chemicals have been the focus point, while still maintaining and achieving the desired Jack & Jones look.
An organic bleaching agent is used instead of conventional chemical treatments. To ensure the lowest impact wash possible in the finishing process, the brand uses Jeanologia’s Environmental Impact Measuring software. The tool measures the environmental impact for each pair of Low Impact Denim jeans.
In cooperation with Orta, one of the world’s leading denim manufacturers, Jack and Jones created an innovative process called Indigo Flow. This new fabric dyeing process is revolutionary.
