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Bangladesh’s RMG export earnings are expected falter in the second half of the current financial year, says a report by Bangladesh Bank.
According to the report, the apparel sector in Bangladesh faces numerous challenges at present. These include high interest rates, inflation, precarious geopolitical environment and concerns regarding productivity growth.
To address these issues, the report makes certain recommendations including diversifying of garment production, Key recommendations include diversifying garment production, enhancing productivity and efficiency, reducing lead time, fostering product innovation, exploring new markets, conducting effective research, improving the skills of garment workers, and modernising production processes to sustain export momentum.
Currently, Bangladesh's export earnings form the RMG sector has been badly impacted by the Russia-Ukraine conflict and global inflation. However, the sector is witnessing resurgence in purchase from major international brands and retailers. This rebound signals progress in mitigating the impacts of the Covid-19 pandemic and the Russia-Ukraine conflict.
However, amidst these developments, the export of apparel manufactured in Bangladesh may face difficulties in the upcoming months due to high interest rates, price inflation, geopolitical uncertainty, sluggish productivity growth, and a complex financial landscape..
According to the report, in the second quarter (October-December) of the current financial year, the revenues from the RMG sector increased by 1.35 per cent from the previous quarter to $1,177 crore while it decreased by 7.46 per cent from corresponding quarter last year.
Knitwear exports experienced a steeper decline of 0.67 per cent to $671 crore from the previous quarter and a 4.17 per cent decline from the same period last year.
Exporters attribute this crisis to reduced garment imports by developed countries, including the United States, due to high inflation.
The Textile Recycling Association (TRA) is urging the UK government to intervene and regulate the industry to stave off a potential collapse. One of the key recommendations of the association includes the implementation of an Extended Producer Responsibility (EPR) scheme by the association.
Representing over 75 per cent of the textile recycling industry, the TRA has expressed concerns over its collection of textile waste from various outlets like charity shops, recycling centers, and community textile banks. The association is particularly concerned about the capacity exhaustion by processing plants, which has raised fears of operational limitations.
Warning of dire environmental consequences on faltering of textile collection operations, TRA cites the potential for microplastic and water pollution that has led to generation of 92 million tons of textile waste annually.
Recent policy shifts in European countries like France, Denmark, Sweden, Finland and Austria have further compounded these challenges leading to European countries like France, Denmark, Sweden, Finland, and Austria, proposing bans on the export of used textiles within the EU.
Emphasising on the urgency of the situation, Dawn Dungate, President, Textile Association, calls for swift government action to implement necessary reforms.
She highlights the industry's pivotal role in waste management, supporting charity, retail, and local authorities, particularly amid the rise of fast fashion.
The crisis in the Red Sea emerges also contributes to the sector's woes, leading to longer shipping routes and skyrocketing costs. Combined with escalating taxation from African and Asian markets and mounting pressure to curtail waste exports, this places immense financial strain on the industry.
Moreover, the proliferation of low-quality textiles from fast fashion exacerbates operational challenges, driving up costs and pushing many textile merchants perilously close to financial collapse.
For the fourth consecutive month, Pakistan's textile exports grew by 3 per cent Y-o-Y to $1.3 billion in March 2024 as against $1.26 billion during the same month last year, shows provisional data from the All Pakistan Textile Mills Association (APTMA).
However, despite this monthly improvement, Pakistan’s textile exports for the first nine months of the fiscal year 2023-2024 declined by 0.3 per cent or $0.04 billion to $12.44 billion.
On a monthly basis, exports dropped by nearly 8 per cent compared to February's $1.41 billion.
Textile exports play a crucial role in Pakistan's economy, particularly in addressing foreign exchange shortages. They constitute a significant portion of the country's exports and help bolster its reserves, which are often supplemented by borrowing in foreign currencies.
Recently, APTMA strongly opposed a 223 per cent increase in gas tariffs over the past year, citing its detrimental impact on Pakistan's export-oriented textile industry. The association highlighted concerns that such hikes make it difficult for the industry to compete internationally, leading to a loss of market share.
APTMA urged the federal government to reconsider the steep rise in gas tariffs to ensure the competitiveness of Pakistan's textile exports in the global market. It emphasised the significant contribution of the textile sector, accounting to 60 per cent of the country's total exports, and warned of the adverse effects of the recent tariff increase on the industry's viability.
Intensifying its expansion into the Middle East, fashion brand Dolce & Gabbana is particularly focusing on the Saudi Arabia market. The brand has inaugurated its flagship store in Riyadh. Additionally, it is forging a formal partnership with Diriyah Company, a state-owned organisation entrusted with the restoration and management of the historic Diriyah area.
Alfonso Dolce, CEO, Dolce & Gabbana, says, the brand had a long-standing interest in Saudi Arabia for its entrepreneurial and dynamic economy alongwith a rich cultural heritage. However, the brand is adopting a cautious approach towards this expansion as it aims to deepen its understanding of the local market over the years.
Besides Riyadh, Dolce & Gabbanna plans to expand in Jeddah by setting up stores in the city by 2024-end. It was one of the first international brands to host a fashion show in the Gulf region post-pandemic, showcasing its Alta Moda collections in Saudi Arabia.
Underscoring the brand’s pioneering spirit, Stefano Gabbana, Co-founder, also emphasises on its integration with local culture and traditions, as showcased in its participation in events like the Tantora Festival in Al Ula and the fashion show in Dubai.
Euratex, alongside CEC and Cotance, is launching the SkillBridge project to tackle the lack of qualified workers in the textile, clothing, leather, and footwear (TCLF) industry. Backed by the EU, SkillBridge will create regional partnerships with industry, education, and authorities.
The project will develop action plans to address evolving skill needs and offer mobility programs for industry stakeholders. It will also support small and medium-sized businesses in upskilling or reskilling their workforce.
SkillBridge complements similar initiatives like MetaSkills and Aequalis, all aiming to fulfill the goals set in the TCLF Pact for Skills. Euratex hopes these projects will strengthen collaboration across the EU's TCLF sector.
Euratex Director General Dirk Vantyghem emphasized attracting young people with the right skills is essential to strengthen the European textiles industry. He expressed gratitude for the EU's support and called on regional authorities to collaborate on designing a successful skills strategy.
Bangladesh's garment industry, a major driver of the nation's economy, is looking beyond cotton and embracing a future of diversified fibers. This strategic shift is driven by a comprehensive study titled "Beyond Cotton" commissioned by the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). The study highlighted the need for diversification in the country's garment exports. While cotton remains a major player, the global market is shifting towards non-cotton alternatives. Emphasizing the importance of the study, stating BGMEA President, Faruque Hassan says, "This report provides a roadmap for us to not only adapt to the evolving global market but to thrive in it... This report opens up new horizons for Bangladesh, and we are excited to embrace the opportunities it presents."
Cotton's dominance, diversification's potential
Historically, cotton has been the primary material for Bangladesh's garment exports, accounting for around 70 per cent in 2022-23. According to the Export Promotion Bureau (EPB) it is worth $55.56 billion in total garment exports in fiscal year 2022-23. However, the global market for non-cotton apparel is larger and is projected to grow faster than cotton. This includes synthetics, regenerated fibers, animal fibers, and other plant-based alternatives. By diversifying its export basket, Bangladesh can tap into this larger market and cater to changing consumer preferences.
Non-cotton apparel accounted for 54 per cent of the $505 billion global apparel market in 2021, according to the Economic Relations Department (ERD) of Bangladesh. The country, currently exports only 29 per cent of its garments in non-cotton materials. The industry is aiming to double this share to $19 billion by 2025. This presents a significant opportunity for growth and diversification.
China is the leading exporter of non-cotton garments, followed by India and Vietnam. Bangladesh, with its strong cotton garment industry, is still relatively new to the non-cotton market, but has the potential to become a major player with strategic development.
Benefits of going beyond cotton
Moving beyond cotton will help Bangladesh meet the evolving demands of global consumers. By offering a wider range of fiber options, Bangladesh can cater to changing consumer preferences and trends. Consumers are increasingly seeking versatile, affordable, and performance-driven clothing, which non-cotton fibers often provide.
Also, expanding into non-cotton segments can strengthen Bangladesh's position in the global apparel market, allowing it to compete more effectively with leading players like China, India, and Taiwan. It will help the country expand its export basket with non-cotton products and will allow Bangladesh to tap into a larger market and cater to a wider range of consumer preferences. Synthetics and other non-cotton fibers can sometimes offer higher profit margins compared to cotton, especially as cotton prices fluctuate. Adding non-cotton products to the export basket broadens the potential customer base, leading to increased market share and revenue.
Roadmap to success
The "Beyond Cotton" study outlines a roadmap for achieving successful diversification:
Developing a complete supply chain for non-cotton products: This involves investing in infrastructure, technology, and expertise to cater to the specific needs of non-cotton manufacturing.
Embracing innovation and versatility: Staying at the forefront of technological advancements and adapting to changing trends will be crucial for sustained success.
Collaboration between stakeholders: Industry leaders, policymakers, and manufacturers need to work together to create a supportive ecosystem for non-cotton production and export.
With diversification, the Bangladesh garment industry can secure its position in the global market, cater to evolving consumer preferences, and propel further growth. This strategic shift paves the way for a future that is innovative, versatile, and adaptable to the ever-changing demands of the fashion world.
Cotton Corporation of India ( CCI) has procured approximately 32.85 lakh bales of cotton at the minimum support price (MSP) during the 2023-24 marketing season.
The highest amount of cotton was procured by Telangana with around 24 lakh bales. States like Maharashtra, Andhra Pradesh and Madhya Pradesh also emerges as the major sourcing states.
Meanwhile, CCI’s procurement activites have declined since Feb’24 as open market prices have surpassed MSP levels. Prices are covering hovering around 7-8 per cent higher than MSP, compelling CCI to adjust its procurement strategy accordingly.
CCI has also specified the MSP for cotton seek with raw current raw cotton prices exceeding the set MSP. The corporation maintains a vigilant presence across markets, ready for intervention if necessary, amidst daily market arrivals and mill consumption.
With a significant focus onTelangana, CCI’s commendable procurement achievement underscores its adaptability to market dynamics.
Chinese-founded e-commerce giant, Shein recorded $2 billion profits in 2023. The e-tailer’s gross merchandise value also increased to approximately $45 billion as the sales of ultra-fast fashion items like bodysuits, minidresses, and slingback pumps increased.
With these numbers, Shein has positioned itself as a formidable force in the global fashion industry, potentially even surpassing previous leaders like H&M Group.
The e-commerce company continues to expand aggressively despite facing regulatory hurdles for its much-anticipated initial public offering (IPO). Its recent acquisitions include a significant stake in Sparc Group and acquiring Missguided's intellectual property.
The company plans to further diversify its business model by opening its platform to global brands and third-party sellers. It also plans to offer its supply chain as a service to outside brands and designers. This will enable the e-tailer to differentiate itself from competitors like Temu, which has emerged as a fierce rival, particularly in the United States.
Currently, Shein is being scrutinised by lawmakers for its interactions with the Chinese government and Communist Party. This has led to lawmakers demanding increased transparency and disclosures from the company.
Meanwhile, the e-commerce giant’s dominance is also being challenged by another company Temu. Despite being criticised for exploiting loopholes to avoid tariffs, Temu continues to expand its market share and revenue.
Cavitec, renowned for high-end coating, laminating, and impregnation machines, debuts the redesigned Caviscreen at Techtextil Frankfurt. Developed by the Swiss firm, a part of the Santex Rimar Group, Caviscreen boasts cutting-edge technology for superior results in breathable laminates, along with cost-saving advantages. Specifically designed for sportswear, rainwear, and protective clothing, this unit applies PUR adhesive with precision, offering strong bonding and versatility."
At the heart of Caviscreen's innovation lies its hotmelt screen printing system, revolutionizing high-end garment applications. Operating akin to traditional textile printing, this system transfers PUR adhesive onto substrates through a rotary screen. The adhesive is seamlessly fed from a drum melter through a heated hose, ensuring consistent distribution behind the doctor blade within the rotary screen.
Manufacturers and end-users laud Cavitec's system for its unmatched precision, resulting in active wear products boasting exceptional air permeability and a luxurious feel. Moreover, the technology enhances bonding strength while minimizing adhesive usage, thanks to surface-level coating that mitigates substrate penetration. Customizable dot patterns and coating weights empower users to tailor performance characteristics precisely.
Caviscreen's ease of operation and efficiency further elevate its appeal. Rapid screen interchangeability, facilitated by a user-friendly bayonet fitting mechanism, streamlines production processes. Unlike conventional methods entailing hot oil or heated liquids, Caviscreen's compatibility with PUR adhesives simplifies operation while ensuring durability.
With a keen eye on cost efficiency, Caviscreen technology slashes expenses by offering screens priced at a fraction of gravure roller costs. At Techtextil Frankfurt 2024, Cavitec unveils Caviscreen and its array of solutions, positioning itself as the go-to destination for cutting-edge textile innovations. From April 23 to 26, industry enthusiasts can explore Cavitec's pioneering technology firsthand at booth D85 in hall 12.
Myanmar will cultivate more than 600,000 acre of cotton across six states and regions during the 2024-25 fiscal year, reports Global New Light of Myanmar.
According to U Min Nuang, Union Minister for Agriculture, Livestock, and Irrigation around 612,712 acre of cotton will be cultivated across 19 cultivation zones.
Myanmar also plans to expand its cotton plantation to over 747,000 acre by the 2027-28 fiscal year. However, for this, it needs to collaborate with the relevant departments, business entities, and farmers, says Min Nuang. .
Emphasisng on the significance of promoting cotton cultivation, Min Nuang says, it will help foster the growth of cotton-based micro, small, and medium-sized enterprises (MSMEs). Increased cotton production will also facilitate exports beyond domestic demand, he adds.
Reportedly, an acre of cotton plantation in Myanmar yields approximately 700 visses, equivalent to over 1,143 kg of cotton.
