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The textile trade landscape has been evolving, with a notable shift towards more sustainable practices driven by environmental concerns. While cotton has historically been a dominant input, its position has been challenged by man-made fibers, particularly polyester. However, the environmental drawbacks of synthetic fibers are now under scrutiny, prompting a resurgence of interest in cotton.
Despite cotton's eco-friendly attributes, it too faces environmental challenges such as high water usage and reliance on pesticides and fertilizers. To address these concerns, the industry has adopted better cotton practices. Additionally, the focus has shifted towards recycling cotton waste to reduce the demand for virgin cotton, a movement gaining momentum globally.
Bangladesh has taken a proactive step in this direction, aiming to save millions through the recycling of domestic cotton waste. This initiative reflects a broader trend towards sustainability in textile production.
The retail price ranges for cotton vary across different countries. In Bangladesh, cotton is priced between US$ 0.9 and US$ 1.6 per kilogram, while in Vietnam, it ranges from US$ 1.4 to US$ 2.3 per kilogram. Australia commands higher prices, with cotton ranging from US$ 4.0 to US$ 8.7 per kilogram. Brazil and China offer more affordable options, with prices ranging from US$ 0.7 to US$ 0.8 per pound and US$ 0.3 to US$ 0.4 per pound, respectively.
In India, recent reports indicate a slight decline in cotton prices, with growers facing challenges in selling their harvest below the minimum support price (MSP). Deputy Chief Minister Devendra Fadnavis has reiterated the importance of enforcing MSP regulations to protect farmers' interests.
Meanwhile, in the United States, cotton prices have seen marginal gains despite mixed economic data. Robust export sales and shipments have contributed to the upward trend in prices, with futures settling at 86.49 cents per pound. However, uncertainties linger, particularly regarding Federal Reserve rate cuts and geopolitical tensions affecting crude oil markets.
A company using genetically modified silkworms to make spider silk, Kraig Biocraft Laboratories, has created a new hybrid silkworm that produces more spider silk per cocoon. Called BAM 1, the new silkworm is expected to be used in production trials in the first and second quarters of 2024.
The company created BAM 1 by selectively breeding its Dragon SilkTM strain with commercial silkworm strains. The resulting hybrid produces more usable silk per cocoon than previous hybrids.
Kraig Biocraft Laboratories plans to use BAM 1 in its spring production trials. The company believes that BAM 1 will be a key player in its efforts to commercialise spider silk production.
CHT Group will showcase its latest generation of sustainable textile technologies at the upcoming Performance Days Functional Fabric Fair from March 20-21, 2024.The fair will focus on dyeing chemicals that enhance performance while minimising environmental impact.
CHT will present solutions for creating high-performance textiles with features like water repellency, breathability, and efficient moisture transport. These solutions also promote significant water and energy savings during dyeing and finishing processes, resulting in a smaller carbon footprint.
CHT will also highlight its advanced dyeing products to achieve vibrant and eco-friendly colors. Prioritising environmental responsibility throughout its operations, the company manufactures products under stringent standards, favoring bio-based, biodegradable, and recycled materials to support circular business practices.
One of India’s largest hosiery producer and exporter, Lux Industries has set up a manufacturing and warehousing facility at Jagadishpur, West Bengal Hosiery Park in Kolkata.
The 4.50 lakh sq ft ‘State-of-the-Art’ facility is spread across 5 acre, of which 20 per cent will be used for manufacturing and balance for warehousing, storage and finishing facilities. The facility will cater to the rising demand of the company’s products and help foster sustainable growth. Strategically designed to optimise workflow, the facility willr reduce the need for vertical movement between different stages of manufacturing process and dependency on third party production.
Ashok Kumar Todi, Chairman, says, this unit will contribute to the growth of industry, create substantial direct and indirect job opportunities, promote sustainability and ecosystem development, and give an impetus to local economic growth.
Pradip Kumar Todi, Managing Director, adds, the facility will help draw inherent advantages in terms of labor availability and infrastructure supremacy. The groundbreaking layout of the facility enhances efficiency, streamlines operations, and underscores the company’s commitment to progressive manufacturing practices.
To be held from March 6-8, 2024 at the National Exhibition and Convention Center in Shanghai, the upcoming Yarn Expo Spring promises a vibrant showcase of the latest in cotton yarn production. To be organised by Messe Frankfurt (HK) and the Sub-Council of Textile Industry, CCPIT, the shows brings together international players to fuel business opportunities across the cotton sub-sector.
Over 500 exhibitors from 11 countries will showcase a wide range of cotton yarns and related products, including pure cotton, viscose blends, recycled and organic options.
The trade show will host an India Pavilion featuring 32 exhibitors led by Texprocil. The pavilion will showcase leading Indian suppliers like Amar International, Excel Enterprise, and Siddhi Sales Corporation.
Newcomers like Blinks International (Pakistan), PT. Bintang Makmur Sentosa Textil Industri (Indonesia), and RÜTEX GmbH (Germany) will present their offerings to a global audience at the trade show.
Held alongside other textile fairs, the expo offers synergy for exhibitors and buyers, allowing them to explore a broader range of textile products and services. It provides a valuable platform for the global cotton yarn industry, connecting buyers and suppliers, fostering innovation, and driving market growth.
Defying economic jitters, Ralph Lauren exceeded the revenue expectations by Wall Street for the 12th straight quarter. The success of the iconic American brand success was driven by factors including a luxury boom in the US.
Wealthy shoppers in the US indulged in Ralph Lauren's classic sweaters and shirts, boosting sales despite economic concerns. This trend aligns with similar strong performances by other luxury brands like LVMH and Cartier.
While some brands faced sluggish wholesale business, Ralph Lauren's focus on direct sales helped mitigate the pressure. This strategy gave the company greater control over brand experience and pricing.
China continued to be key growth driver for Ralph Lauren with a 30 per cent surge in sales. This also reflected a recovering Chinese economy and growing demand for luxury goods.
Ralph Lauren's financial performance reflects its strategic positioning and ability to capitalise on key market trends. The company's strong showing bodes well for the future of the luxury sector, particularly with its focus on direct-to-consumer channels and targeted markets like China.
Poland has emerged as key intermediary to import garments from Bangladesh and re-export them to Russia. Data from the Export Promotion Bureau, show, Poland’s apparel imports from Bangladesh surged by 19 per cent Y-o-Y to $884 during n July-Dec 2023. On the other hand, Russia's direct apparel imports from Bangladesh dropped by 27 per cent in 2022-23.
Boosted by EU’s duty-free scheme, Poland's apparel exports to Russia crossed $1 billion in 2020-21. Exports of knitwear and jumpers surged despite the Russia-Ukraine war. .
Western sanctions restrict direct trade between Russia and some suppliers. However, Poland's proximity to Russia facilitates road transport of garments, says Mohammad Hatem, Executive President, BKMEA. The country also benefits from duty-free exports under the EBA scheme, he adds.
This trade loop allows Bangladesh to continue exporting garments to Russia despite sanctions. It also enables Poland to increase its trade volume and potential profits. However, the sustainability of this trade loop depends on Poland's willingness to act as an intermediary.
International Irish clothing retailer Primark is opening a new distribution center in Jacksonville, Florid.
Boasting an over 550,000 sq ft warehouse space, the newly inaugurated distribution center is situated in in North Jacksonville. This is Primark’s second distribution center in the US, in addition to Bethlehem, PA. Its opening aligns with
Primark’s vision to strengthen its presence in the US, particularly in the Southern states including Florida and Texas.
Primark also plans to open four new stores at prominent locations including Potomac Mills in Woodbridge, Virginia; Mall at Prince George’s in Hyattsville, Maryland; CoolSprings Galleria in Franklin, Tennessee; and Katy Mills in Katy, Texas.
There is a growing demand for Primark stores across the US, particularly in the southern locations, says Kevin Tulip, President, Primark US.
The retailer plans to further expand its footprint in Florida by opening new stores in Orlando and beyond. Primark currently operates 24 stores across nine states in the US. It plans to expand its store network in the country to 60 by 2026.
Textile giants from across the globe are converging in India for Bharat Tex 2024, touted as the country's biggest textile expo. The event is expected to host over 3,000 companies, including Swedish giant H&M, American retailer Target, and British thread maker Coats Group, who will showcase their products at the fair.
Aiming to catapult India's textile exports, the expo will prove to be a crucial stepping stone towards achieving ambitious targets including $40 billion in apparel exports by 2030 and overall exports reaching $100 billion. The industry itself is poised for significant growth, with expectations of economic output reaching $250 billion by 2030.
Inaugurated by Prime Minister Narendra Modi, the expo will feature a diverse range of products, from fibre and yarn to handicrafts. Around 2,000 weavers and artisans will also display their unique creations, highlighting India's rich textile heritage.
Leading Indian companies like Aditya Birla Group, Reliance Group, and Arvind Fashion will be present at the expo, alongside international delegations from key textile hubs. This event promises to be a hub of collaboration and business opportunities, propelling India's textile industry towards a bright future.
India's textile industry, a major contributor to the economy, is facing a ripple effect due to a new amendment in the Companies Act 2023. This amendment, aimed at improving liquidity for Micro, Small, and Medium Enterprises (MSMEs), mandates faster payments to these entities. While the long-term benefits are debatable, the immediate impact has been disruption and uncertainty in the trade, particularly for yarn and other textile products.
The new amendment and its affects
The Amendment in Section 43B(h) of the Income Tax Act now requires tax payers (businesses registered under Companies Act 2023) to pay micro and small enterprises (MSMEs) within 45 days (with a written agreement) or 15 days (without a written agreement). As an expert points out the law is a positive step towards empowering MSMEs, but the government needs to provide support and guidance to ensure smooth implementation.
However, this change has caused confusion and short-term disruption in textile trade. Some buyers are avoiding purchases in the current fiscal year to avoid tax implications. Indeed, proponents argue the law will improve cash flow for MSMEs, boosting their financial health and growth potential. However, critics highlight the practical difficulties of adhering to the strict timelines, especially in industries with established longer credit periods. Additionally, the onus of verifying supplier registration under the MSME Act adds to its complexity.
It may be noted that the Indian textile industry contributes over 7 per cent to the GDP and employs over 45 million people. MSMEs account for over 90 per cent of textile units in India, highlighting their significance. Traditionally, the textile industry operates on credit periods ranging from 60 to 120 days. With the change in rule initial reports suggest a decline in new purchases and order cancellations.
New rule overview
| Feature | Description |
| Amendment | Section 43B(h) of the Income Tax Act |
| Applicability | All purchases from registered MSEs |
| Payment Deadline | 45 days (written agreement), 15 days (no agreement) |
| Consequence of Late Payment | Unpaid amount becomes taxable income for buyer in next year |
| Effective Date | April 1, 2023 |
Weighing in the pros and cons
Indeed, there are pros and cons of this change. While supporters say, the change means improved cash flow and financial stability for MSMEs; reduced dependence on credit and potential for expansion; increased bargaining power and fairer market practices. For example, a textile manufacturer in Surat, struggling with delayed payments from large buyers, welcomes the new law as a potential game-changer for their business.
However, critics argue, potential loss of business due to stricter payment terms; increased administrative burden for documentation and verification. As a garment exporter in Delhi expresses his concern about the practical challenges of implementing the new payment terms, particularly with overseas suppliers.
Similarly for buyers, the pros are compliance with the law and avoidance of tax implications; potential for long-term cost savings due to reduced interest payments. The cons on the other hand are: short-term disruption in established business practices; difficulty in adjusting to shorter credit periods; increased risk of stockouts and production delays
The new payment law for MSMEs in India has sparked a debate within the textile industry. While its long-term benefits for financial inclusion and MSME growth are undeniable, the immediate challenges of disruption and adaptation cannot be ignored. A balanced approach, considering industry feedback and providing necessary support, is crucial for ensuring a smooth transition and maximizing the positive impact of this legislation.
