FW
Cotlook discarded anticipation of a further fall in world cotton inventories next season, quoting the prospects of a strong US harvest. Starting in August Cotlook forecast a rise of 44000 tonnes in world inventories of the fibre in 2017-18.The estimate contrasted with a previous expectation of a small decrease in stocks, of 47,000 tonnes. And it placed Cotlook at chances with an idea from the US Department of Agriculture of a 520000-tonne decreased in world cotton stocks next season.
On the other hand the International Cotton Advisory Committee estimates to fall by 960000-tonne.
Talking about the firm prices Cotlook's raised inventory estimate reflected an increased forecast for world production, upgraded by 91000 tonnes to 24.5 million tonnes, to improved ideas for the US harvest. Cotlook also stood by expecting for output in top grower Indian, seeing the country's harvest at 6.29 million tonnes, ahead of the USDA's 6.10 million tonne figure, and a forecast from the ICAC below 6 million tonnes.
According to the group the Global raw cotton production may rise by 1.78 million tonnes, which has increased to 4.18m tonnes its forecast for the US crop, putting its figure in line with that of the US Department of Agriculture. The group also highlighted a "difference" in inventory moves, with China's stocks seen dropping by nearly 2m tonnes over 2017-18, as the country extends a sell-down of government inventories swollen by a now-reformed guaranteed pricing scheme for growers. In the rest of the world, "an addition of similar magnitude is foreseen" cotton in inventories.
It is surprising to know that the govt still thinks polyester is a fibre for high class and cotton is for poor class, that is the reason growth is restricted. Soon a day will come when govt will have to think independently, if it wants to grow at bigger pace like Bangladesh/Vietnam etc, says R K Vij, Advisor, Indorama Synthetics
The manmade textile industry wants the government to lower the levy for manmade fibre (MMF) products. MMF fabric and yarn, dying and printing units as well as embroidery items would attract 18% GST. This would result in an increase in input costs and adversely affect the entire textile value chain, industry officials said.
"Keeping the GST at this rate (for MMF products) will undoubtedly cripple hundreds of small and medium synthetic textile manufacturers," said J Thulasidharan, chairman, Confederation of Indian Textile Industry (CITI). "The 18% GST rate levied on manmade fibre and synthetic yarn would have inverted duty structure problem as the fabric would attract only 5% GST rate," said M Senthilkumar, chairman, Southern India Mills' Association. "Garment units may find it difficult to offset input tax credit (for synthetic fibre and fabric)," said Raja M Shanmugham, president, Tirupur Exporters' Association (TEA). The government should reconsider the rates on MMF products and bring it to 12%, Thulasidharan said. "India is already suffering a huge competitive disadvantage in the global textile market as the MMF-based textile products are attracting higher rates of import duty," he pointed out.
India is facing stiff competition from textile producing countries such as Bangladesh, Vietnam and China, he said. "Keeping the tax rates high will not only escalate textile inflation but will lead to cheap imports from these countries," the CITI chairman said. "The textile sector is suffering from various disadvantages like high energy costs and infrastructure bottlenecks. Keeping the rates of key inputs at a higher level will further affect the competitiveness of the sector," he said.
Industry officials also urged the government to exempt textile jobs from service tax as it would benefit the predominantly decentralised micro, small and medium enterprises, especially in the powerloom, knitting, processing and garmenting sectors.
About 80% of garment units in Tirupur do their business on a job working basis and the 18% service tax on textile jobs would hit them hard, Raja Shanmugham said. The GST rates for all natural fibres including cotton, cotton yarn, fabrics and readymade garments valued below Rs 1,000 has been fixed at 5%, which has been in line with the expectations of the textile industry.
R K Vij, Advisor, Indorama Synthetics adds some more pertinent points, raising issues related to accumulated Cenvat and other, “Manmade fibre sector is not placed well. Since last so many years, the whole textile industry has been demanding fibre neutrality, if we have to grow in line with world pace. Textile cloth producers small or big will accumulate Cenvat credit. It is surprising to know that the govt still thinks polyester is a fibre for high class and cotton is for poor class, that is the reason growth is restricted. Soon a day will come when govt will have to think independently, if wants to grow at bigger pace like Bangladesh/Vietnam etc.
He further adds, “Man made Textiles cloth and garments will become costly because no producer will adjust the accumulated CENVAT credit while selling their goods. Import of manmade fabric will increase because garments producer will get cheaper imported fabric. Blended yarn producers may sell their blended yarns misrepresenting them as cotton yarn. Only efficient producer and composite mill will be able to compete in the markets. Spinners will have to add value, adding fabric manufacturing in their units to utilise the accumulated Cenvat. Govt should consider these facts and rethink their secessions of GST percentage of 12% if not the 5% on Manmade fibres and yarn including on raw material PTA and MEG.
In his opinion, 18 per cent tax on job work will require a lot of compliance. Also fabrics import price now with removal of cvd n sad but GST input credit to importer need to be looked into. Man made fabrics may have some impact as recycled polyester is same duty as 18 per cent, as earlier it was 2 percent only.
The recent levies of taxes under new GST regime had brought big benefits to the composite textile units as compared to the independent textile manufacturing units. Manufacturers who are getting their goods manufactured on job basis are the worst sufferers.
They have to pay GST @18%on yarn or 5%in case of cotton , 18%on job weaving charges and also 18% on job processing charges whereas composite units are not required to pay any GST at these stages. No textile manufacturer is entitled for any refund. Means GST paid on all inputs are higher since their conversion cost is very less than payable on fabrics then no refund will be allowed. This would lead to cost escalation and make their fabrics costlier than composite units. This is for sure under the current tax regime job manufacturers who are not owning their industries will be left with no alternative other than to close their operations.
A composite manufacturer will have to pay tax only at fiber stage and then finally on fabrics against which duty paid on fiber will be set of. As against this merchant manufacturer will have to pay tax at yarn stage, weaving stage and processing stage and this altogether is more than the GST payable on fabrics. This is against the basic principal of GST that full input credit is not allowed since it results into refund.
This differentiation between composite units, weaving units and finally manufacturers on job basis would be substantial and will lead to closure of the business by job manufacturers. Government's policy had been always to safeguard the interest of the small and less resourceful merchant manufacturers whereas their this step has gone drastically against the small manufacturers and traders.
Strong representation is being contemplated to be made to the finance ministry/GST council to save this section of manufacturers from this anomaly. This is possible only if the textile services like weaving, processing should be exempted from the preview of GST. If at all this is not possible then these services should not be taxed at a rate more than the rate of output that is 5%. Small weaving units and merchant manufacturers are catering largely to the clothing needs of the poor and economically weaker section of the country.
Textile and fashion is the second biggest industry in Italy after machinery. Fashion in Italy in the widest sense includes in addition to apparel and products such as eyewear, jewelry and cosmetics.
Italian fashion revenues continue to outperform Italy’s broader economy, and in the last part of 2016 and in the first quarter of 2017 they even picked up speed.
Italy’s products continue to be appreciated in countries such as China and Korea in Asia. Japan and Hong Kong are also good, with exports growing at 5.8 per cent and 8.5 per cent. Exports from Italy to Russia are up 19.5 per cent.
However there has been a slowdown in exports to the United States. Companies need to increase their presence in international markets and need to find capital to make it happen especially for medium-sized businesses.
The fashion and luxury industry must exploit the new opportunities for personalization. Customization is strategic: already 22 per cent of luxury consumers consider this important when they make purchases, a percentage that is expected to increase in every country, and in particular among millennials, born after the 1980s.
Growth in luxury is expected to continue. Between 2009 and 2013 it was 8.3 per cent and between 2013 and 2016 it was 3.8 per cent.
Bangladesh’s garment industry wants full withdrawal of source tax and additional five per cent cash incentives for the next two years.
It also wants the corporate tax to be reduced to ten per cent from the proposed 15 per cent. It feels imposition of such a tax burden on the industry is not appropriate and would hamper its growth.
The existing source tax on garment exports is 0.7 per cent for the current fiscal year. The proposal is to make it one per cent from the next fiscal.
Other points made by the industry include additional five per cent cash incentives on freight on board price.
The garment industry is Bangladesh’s largest manufacturing industry. The sector has been facing various challenges including currency devaluation in major markets, decline in global demand for garments, ongoing safety initiatives and increasing cost of doing business.
The budget for fiscal year 2017-18 proposes reducing corporate tax to 15 per cent and a further cut of one per cent to 14 per cent for readymade garment companies having internationally recognised green building certification from the existing 20 per cent. Bangladesh has a target of achieving 7.4 per cent economic growth in the new fiscal year.
AEPC feels the apparel industry was looking forward to a simplified tax regime under GST, with a single rate for the entire value chain, but that the multiplicity of rates announced will lead to interpretational issues.
For instance, while the cotton value chain was largely under the zero duty route, the introduction of five per cent tax would lead to an increase in production cost.
AEPC also says the 12 per cent rate for readymade garments above Rs 1000 is higher than the industry expectations. “Readymade garments are the historic growth engine of this industry and the maximum employment generator as well,” says Ashok Rajani, chairman, AEPC. “We hope that the government takes care of this segment’s interest by continuing with ROSL and the drawback rates.”
Tirupur apparel exporters fear the GST rates set for different segments of the knitwear production chain can create complexities and erode profit margins.
The differing GST scales fixed for various processes in the apparel production chain can have ramifications considering that the production chain in the Tirupur cluster remains mostly fragmented.
Complexity will arise as job work is going to be taxed at 18 per cent even though garments attract only five per cent. In Tirupur, processes like dyeing, knitting, fabrication and printing among many others are being carried out as job works.
GST says nothing about the duty drawback scheme. Exporters say unless the duty drawback rates are made clear, the profit margins can shrink. It is because the central excise and the service tax components in the drawback are going to get integrated with the GST and only the customs duty component that comes to just over two per cent will be outside the GST purview.
Exporters say the 18 per cent GST rate on manmade fiber and synthetic yarn would have an inverted duty structure problem as the fabric was under the five per cent rate. The high rates for manmade fiber and yarn would lead to an increase in input costs and adversely affect the synthetic sector.
There was a serious concern regarding the grave violation of labor laws by the The National Labour Council and the Pakistan Institute of Labour Education and Research. Especially on local brands such as Khaadithat do not provide safe working conditions to its workers and terminate the labourers when they demand their due rights. The workers have still not been reinstated in spite of ongoing protests and instructions of the National Industrial Relations Court. NLC and Piler leaders Karamat Ali, Latif Nizamani, Habibuddin Junaidi, Shafiq Ghauri, Saeed Baloch observed that local textile manufacturers often hire workers through the third-party employment system. The workers are paidRs15,000 per month which is less than the official minimum wage amount also, the wages would be deducted if the workers took any emergency leaves.
On the other hand the workers have been complain that they work for over 12 hours instead of the designated eight hours and are not paid overtime for the extra hours put in. The owners demand more productions per worker when they receive additional orders. A millions of rupees has been earned from their sales in local markets, especially during Ramazanand no proper payment is done to their employees. The working conditions in factories of the textile brands are unsafe as most of the companies often lock doors from the outside during work hours on the pretext of avoiding theft, the labour leaders maintained.
The labour inspection system is inadequate as the number of inspectors available with the department is far smaller than the number of industries. The labour laws has been exploited by the manufacturers the reason being the citing deaths of over 250 workers in the Ali Enterprises fire the officials continued that the high number of casualties occurred because the owners had locked all the exit points from the outside. The labour leaders further demands that the employers must ensure safe working conditions for laborers, provided with their respective rights.
London Textile Fair will be held July 19 to 20, 2017. It will feature a wide range of fashion textiles, accessories, print studios and vintage garments focusing on autumn/winter 2018 collections. The show will have a hall dedicated to fashion textiles accommodating about 50 new exhibitors. The fair was first organised in 2008.
Industry professionals who come to the event represent almost every fashion brand and designer within the UK - from high-street chains to independent women’s, men’s and children’s clothing retailers such as Top Shop, John Lewis, Dorothy Perkins, Tesco, Debenhams, Ted Backer, Missguided, All Saints, Coast, Marks & Spencer, Accessorize, River Island and many more.
The accessories and textiles halls have together more than 90 per cent of the total exhibiting space and, due to the increasing interest from new companies, the organisers have opened a new room which accommodates 50 new fabric manufacturers.
The July 2017 edition will have a wide selection of women’s wear, men’s wear, children’s wear fabrics and accessories with an increasing number of technical textile manufacturers.
The accessories hall has grown exponentially over the last five editions, showcasing an impressively diverse range of products from the best European manufacturers. The number of exhibitors has exceeded expectation, with about 30 per cent new companies registered for July.
The 18th edition of YiwuTex will be held during 13-15 June 2017 at Yiwu International Expo Centre, Zhejiang Province, PR China. To present their novel technology and intelligent production equipment they would aim to help garment manufacturers to enhance productivity and save cost, the “Functional Knitting Machinery Zone” will gather top-notch knitting and hosiery enterprises, including Zhejiang Yexiao and Hefei Opek.
With nearly two decades of rich experience in manufacturing knitting machinery, strong technical force and sophisticated production equipment, Zhejiang Yexiao has two manufacturing centers and a product R&D center. At YiwuTex, Yexiao will mainly display computerized hosiery machine and flat knitting machine, along with its star product “6F Computer Terry / Flat Machine”, It has a lot of features like every sock can be weaved in thirteen color, it can weave 3D pattern socks, it comes with sensor for automatic protection of computer and electronic parts and appropriate for producing functional socks such as football socks, varicosity socks, thickening socks, etc.
YiwuTex 2017 event features “Smart Apparel Machinery Zone” and “Digital Printing Machinery Zone” to help industry players to improve competitiveness. A series of conferences will be held during the show period and will cover topics on knitting industry. The well praised Knitwear Display Zone will showcase the latest knitting techniques, fabric technologies and printing patterns. For registration nd more information you can visit YiwuTex official website. YiwuTex has also recently transferred its Wechat to a new account and visitors could scan the QR code below to follow it for the latest show updates.
