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"Blockchain technology is paving its path into the cotton market. This technology makes transactions and contracts simpler and tracing more accurate. But, the questions of reliability, scalability and governance of this revolutionary technology need to be answered before it is at a bigger scale. In October 2016, the Wells Fargo and Commonwealth Bank of Australia used blockchain technology to process and execute a cotton shipment worth $35,000 from Texas to Qingdao, China."
Blockchain technology is paving its path into the cotton market. This technology makes transactions and contracts simpler and tracing more accurate. But, the questions of reliability, scalability and governance of this revolutionary technology need to be answered before it is at a bigger scale.
In October 2016, the Wells Fargo and Commonwealth Bank of Australia used blockchain technology to process and execute a cotton shipment worth $35,000 from Texas to Qingdao, China. This transaction – driven by smart contracts – eliminated a lot of paperwork which was otherwise needed to ensure that all the information is up-to-date and the same in both party’s records.
Blockchain to save transaction time
Blockchain technology reduces physical documentation and saves exponential time in receiving payments. It also saves time for the merchant to receive payment from the banks for the sale transaction, as the bill of lading and other supporting documents need not to be mailed physically to the Letter of Credit (LC) opening bank by the seller. The availability of authenticated documents linked in blockchain technology reduces the working capital cycle and the cost, which could be an advantage to all the parties to the trade.
Tracing the authenticity of cotton origin
The complex supply chain of cotton products involves many transactions, which makes it difficult to trace the origin, especially
in case of organic cotton and BCI cotton. This transformational technology helps us maintain and check the authenticity of the origin by tracing it from field using GPS technology to fabric and fabric to field.
The technology uses the decentralisation concept, as every user has access to non-restricted data. Private information on a public platform requires a well-designed and secured platform to avoid it from being used for wrong purposes. This questions the reliability and the confidentiality of the information shared on this platform. It would be reliable and trustworthy if this technology is decentralized and yet maintained by an international regulatory, which sets the standards and legalities to ensure smooth functioning for transactions.
Maintaining records for reliable estimates
Blockchain technology also maintains data and records. The records provide reliable estimates every year for cotton for its opening stock, consumption and closing stock in every country. USDA could use this as a platform to source the data for cotton growth, consumption and ending stocks, allowing them to update the estimates based on current available information. This could help avoid unnecessary volatility in the market, and the market price would include all real market information which factors and defines the actual market data.
The International Cotton Association needs to promote this technology and start implementing it with their members. The challenges of security and reliability also need to be addressed for successful implementation in the market. The traceability of data and maintaining records analyses the competency of the parties in the trade and brings transparency to the availability of market data. The blockchain technology is thus beneficial and would revolutionise the cotton market.
"Over 150 consumer-oriented public and private companies will make presentations before investors, analysts, traders and executives in Orlando, Fla at the 21st annual ICR Conference. However, before these presentations, companies including Urban Outfitters, American Eagle Outfitters, Lululemon Athletica, and Abercrombie & Fitch Co. will issue certain pre-announcements. The Conference will be held between January 14-16, 2018. Public company presentations will be held on the first two days while discussions with private companies will be held on the final day."
Over 150 consumer-oriented public and private companies will make presentations before investors, analysts, traders and executives in Orlando, Fla at the 21st annual ICR Conference. However, before these presentations, companies including Urban Outfitters, American Eagle Outfitters, Lululemon Athletica, and Abercrombie & Fitch Co. will issue certain pre-announcements.
The Conference will be held between January 14-16, 2018. Public company presentations will be held on the first two days while discussions with private companies will be held on the final day. Company slide shows at the presentations will feature business updates and strategic plans for the coming year, or longer term.
A strong line up of speakers
Various retail-related names like branded or specialty apparel companies will deliver speeches at the ICR. DA Davidson analyst John Morris expects investors to focus on company strategies in the event of a macro slowdown, including plans for cost cutting.
In addition, buying plans for the second half of the year may also be high on investors’ minds., Morris sees a risk “because
most companies are likely extrapolating recent healthy Fall and Holiday demand into next year and if demand doesn’t follow through, margins could come under pressure from promotions.” Moris says rising labor costs will likely be a top issue this year. Early reads on Spring selling will also be of interest. In addition, he will be looking for any shift in the negative sentiment that has prevailed over the branded apparel sector.
According to Jefferies retail analysts, the conference will not reverse the “challenged” sentiment around the specialty softline retailers, which stems from tough holiday and first- quarter comparisons and uncertainty around expenses. But “a string of positive pre-announcements could help partially re-assure the market. Potential 2019 expense headwinds (wages, freight, shipping, tariffs, investments in marketing and e-commerce) are likely to be other key topics of investor interest, outside of a read on sales trends.
Telsey Advisory Group’s Dana Telsey expects a fairly positive tone from specialty retailers at the event. But, with 13 companies that Telsey covers falling an average of 23 percent in the fourth quarter of 2018, clearly there are likely to be major concerns.
Doubts revolve around whether sales strength in the fourth quarter and the new year can flow to the bottom line given labor, freight, and trade costs, as well as digital and marketing investments. Telsey also noted that sales and margin comparisons will become more challenging through 2019 and investors will seek color on the ability to drive leverage while e-commerce continues to grow as a percentage of the overall mix and as the one-time benefit of tax reform anniversaries in the new year.
Operating profit of Uniqlo’s Japan fell 30 per cent in the first quarter compared to the same period a year ago. Uniqlo, known for its simple and affordable clothes such as lightweight down jackets, is battling saturation in its main home market, Japan. It could also come under pressure due to a slowdown in China, where it typically logs a major proportion of its growth. Unseasonably warm weather hit sales of winter clothes.
Japan Uniqlo profit is expected to rise sharply in the second half of the year on strong cost control. Fast Retailing is the owner of Uniqlo. The retailer’s overall operating profit fell eight per cent over September to November. The domestic business is expected to record a larger-than-expected decline in profit in the first half due to the discounting.
The company will increase discounting in Greater China and South Korea to offload winter inventory. However, Uniqlo’s international business is expected to rake in strong first-half revenue and profit growth. Operating profit for the business jumped 12.6 per cent in the reported quarter, boosted by a double-digit growth in China. The firm opened 78 stores in China last fiscal year, expanding to 633 locations, while it closed four stores in Japan, ending the year with 827 stores.
The UK is exploring entry into the Trans-Pacific Partnership as well as a free-trade agreement with Japan after it leaves the European Union at the end of March. The economic partnership agreement between Japan and the EU will take effect in February, allowing the UK to trade under that framework as long as it remains in the bloc. But Britain will fall outside the treaty's jurisdiction should a no-deal Brexit materialise, making a new trade pact necessary to maintain a smooth trading relationship with Japan.
London is open to both bilateral and multilateral deals like the 11-nation TPP, which recently went into force, to ensure that Japanese companies can stably enter the British market.
The American Apparel and Footwear Association (AAFA), through its Safety in Denim Finishing Working Group, collaborated with industry professionals and outside consultants to release a new set of guidelines and best practices for denim finishing facilities in December that it hopes will create a better industry for both workers and the brands they represent.
The guide is specifically designed for denim finishing facilities, giving facility managers—most of which are independent and contracted out by brands. It includes safety protocols for common techniques in denim finishing, like bleaching or creating wear marks, that a more general understanding of workplace safety might not properly cover.
Those tapping into the denim safety guideline will find several indicators for success, the least of which is an increased level of production and return on investment for brands that should come as a result of fewer production accidents and employee illnesses. Not to mention, brands have the added benefit of attracting better workers and better press.
Workers in Chinese textile factories are exposed to high levels of air pollution. At one facility, levels of particles less than 2.5 micrometers in diameter (PM2.5) averaged 85 micrograms per cubic meter, or roughly seven times the safe limit set by the US Environmental Protection Agency. An increase in PM2.5 by ten micrograms per cubic meter sustained over 25 days reduces daily output by one per cent, harming firms and workers.
High levels of particles are visible and affect an individual’s well-being in a multitude of ways. Besides entering via the lungs and into the bloodstream, there could also be a psychological element. Working in a highly polluted setting for long periods of time affects mood or the disposition to work.
China’s polluted skies have been a problem for years now, with the country’s mean annual PM2.5 exposure spiking from 48 micrograms per cubic meter in 1990 to 56 in 2016. Laborers in China can be working under far worse daily conditions while maintaining levels of productivity that look comparable to clean air days.
India is among the top suppliers of textile and apparel products to Indonesia. Cotton textiles are the largest category, with a share of 65 per cent in India’s textile and apparel exports to Indonesia. This is followed by manmade textiles and apparel having a share of 20 per cent and seven per cent respectively.
There was a decrease in India’s exports in 2015 due to mounting competition from other countries like China, Korea, the US, etc. However, since the last three years India’s exports to Indonesia are again increasing. India’s exports to Indonesia have increased at a CAGR of seven per cent over the last five years. However, the share has remained two or three per cent during the same period of time.
With a share of about 42 per cent, China is the leading textile and apparel supplier to Indonesia, but it is now focusing more on the domestic market as manufacturing costs in China are increasing. This India an opportunity to grab China’s share and increase its exports to Indonesia.
Cotton was the largest exported commodity to Indonesia from India, but Indonesia is now shifting its focus from cotton-based to manmade textiles. India has the opportunity to increase its share of manmade textiles by focusing on exports of polyester filaments and viscose staple fiber.
The Pakistan Readymade Garments Manufacturers and Exporters Association is confident that PM Imran Khan and his economic team will bail the country out of the economic crisis by paying special attention to the export-oriented industry. PRGMEA pointed out that the incumbent government has fulfilled all its commitments made to the exporters within very short span, particularly lowering gas tariff to $6.5/MMBTU and reducing electricity rates to Rs 7.50 cents/kWh to the exporting industry.
Sales Tax refund payment has been cleared against RPOs while payment processing of Deferred Sales Tax refunds, which were pending for the last 15 years, has also been started. PRGMEA also appreciated the government to allow advance payments for imports of basic industrial raw material. Appreciating the government on taking serious notice of the severe issue, it said the move has raised the business community's confidence and such business friendly policies will definitely result in boosting the trade and industry. The facility's withdrawal had severely affected the export-oriented industries of the country. The move also delayed export shipments besides scaling up the cost of production.
The country's budget deficit was Rs 230 billion before this government, after coming into power it has reduced it by Rs 130 billion. This government has fulfilled its commitment to the nation by taking the country out of inherited financial crisis and is successfully managing the pending external payments.
A textile and garment machinery exhibition (DTG) is on in Bangladesh from January 9 to 12, 2019. This is the largest textile machinery exhibition in Southeast Asia. Bangladesh has now emerged one of the potential markets for global textile and garment machinery manufacturers thanks to rising demands for locally made apparel items across the world.
Spinners, weavers and readymade garment makers have been investing billions of dollars in setting up new factories and expanding their existing capacity. Millers and exporters can buy machinery from the exhibition venue.
Some 1,200 textile and machinery manufacturing companies from 37 countries including Australia, China, France, Germany, India, Italy, Japan, Korea, Taiwan, UAE, UK and the US are displaying their products at 1,650 booths.
Textile machinery manufacturers value Bangladesh as the center of the textile and clothing machinery business hub. Local spinning millers meet 80 per cent to 85 per cent of the knitwear sector’s requirements while woven millers can meet 35 per cent to 40 per cent of the demand for woven fabrics by readymade garment exporters. Textile and apparel buyers see Bangladesh as a major sourcing destination. DTG is now in its 15the and participation rose by about 25 per cent.
Kochi-based Kitex Garments, currently the third largest infant apparel manufacturer in the world, will raise production capacity over 3.5 times to produce 22 lakh pieces per day by 2025 from the current six lakh pieces of finished garments per day for 'just-borns' and babies up to two years.
The company will add capacity across the value chain by increasing knitting and processing capacity to 80 tons each and is expanding the sewing production capacity. It will also diversify into new product lines like socks for children, baby diapers and baby wet wipes, besides setting up a cotton spinning mill with a capacity of 80 tonnes per day as part of vertical integration. The ongoing expansion with an estimated Rs 910 crore will help the company reach revenues of Rs 2,165 crore by 2024-25 with an average growth of over 20 per cent every year from the Rs 559 crore revenues in 2017-18. While land identification is complete, machinery and supplier identification and building and infrastructure planning is going on.
