FW
Garment manufacturers in Tirupur have urged textile mills in their region to drop the move to increase prices of hosiery yarn as cotton prices are climbing down. Cotton prices have come down by Rs 2,000 per candy (about 355 kg) and the inclination of mills to increase cotton yarn prices will severely affect Tirupur garment export sector, points out A Sakthivel, President, Tirupur Exporters' Association (TEA).
Hosiery yarn prices, which were being sold at Rs 216 per kg in April is now being quoted at around Rs 250 per kg after three rounds of price increases. The increase in hosiery yarn prices has not been commensurate with the rise in cotton prices, said K Selvaraju, Secretary-General, Southern India Mills' Association (SIMA). Even after accounting for the recent decline in cotton prices, the cost of clean cotton (after removing waste and short fibres) increased by Rs 52 per kg since in April while hosiery yarn prices have gone up by only by Rs 34 per kg. About 70kgs of combed hosiery yarn is typically produced from 100 kg of cotton. Around 85 kgs carded hosiery yarn is made from 100 kgs of cotton.
In a letter to SIMA, Sakthivel urged them to not resort to increase yarn prices when cotton prices are coming down. He said they had an apprehension that the business created over time may go out of India and once the business is lost it would be difficult to bring it back.
Diplomats of seven African countries have invited Coimbatore's trading and industrial community to invest in their countries in different sectors including textiles. The diplomats were speaking at a meeting organised by the Confederation of Industry (CII) in Coimbatore on “Africa Seminar Series – the Land of Unexplored Potential”. Two of them particularly highlighted the textiles and apparel sector where Indian companies can invest in their countries.
Mali's ambassador, Niankoro Yeah Samake said Coimbatore was of special interest to his country because cotton was a major export product of the country and Coimbatore a hub for textile industry. In February next year, a trade mission from India will visit Mali to explore opportunities in different sectors including cotton in that country.
Minister Counsellor and Charge d' Affairs of the Ethiopian Embassy Molalign Asfaw pointed out that Ethiopia has registered double digit growth for more than a decade and over 600 Indian companies have registered in the country. Of these, 250 have started operations. He said the country has 12 industrial parks and offers several tax incentives to investors and there are enough opportunities for textiles and apparel industries.
Diplomats from Uganda, Botswana, Tanzania, Zambia and Mauritius also spoke at the meeting.
The long spell of rainy days this year till now is proving to be a cause of worry for cotton farmers in Adilabad district in Telangana. As it is the prolonged cloudy weather has already caused stunting of growth in cotton plants and it is feared that another 10 days of similar conditions could spell doom for the entire crop. Lack of photosynthesis due to the absence of sunlight and heavy weeding impeding growth are the main reasons for the stunted plants.
Though the normal rainfall in Adilabad is about 110 cm during the monsoons, the rainy days are usually spread over a four-month period under ideal conditions. However, this year, the average rainfall during the first two months has exceeded the normal quota of the corresponding period by 35 per cent as additional number of rainy days was recorded in June and July.
The initial anxiety of the dry spell gave way to spells of good rainfall. While June recorded 13 days of rainfall, the trend continued in July which had as many as 23 rainy days with local people not getting a chance to see a sunny day. The plant lost growth of about 6 inches due to damp weather. Now, the plants need sunlight immediately otherwise the yield of cotton will decrease abnormally. Under such conditions, the plants go to their reproductive stage sooner than they would have done under normal conditions. The bolls formed under these conditions are smaller.
The July nylon textile filament (NFY) market in China showed divergence from last year. Compared with 2015, the NFY market tracked a similar trend in January to March 2016 to rise up after a decline. But the downtrend began earlier than last year to fall from early May, and NFY prices were pushed up slightly in July amid deficit pressure from a surging feedstock. However in 2015, NFY prices began falling in end June and speeded up decline in July.
It is one year since the meeting of non-credit sales by eight NFY leading companies. Most enterprises have already made a conscious attempt to control credit deals, but to totally solve the arrear problem by end 2016 is very hard. Though the growth rate of account receivables in January to July 2016 is significantly lower than the same period last year, the arrears left before the 2016 spring festival were much higher than before, so the overall account receivables remain high.
Despite a higher run rate of 60 to 70 per cent in off-season, NFY demand not only comes from downstream hand-to-mouth purchasing, but also to prepare stocks in advance. Therefore, the August demand will be lighter after the transient increment, and NFY plants are suggested to control potential risks.
A Chinese conglomerate has shown interest in investing Rs 600 crores in the textile park at Sitarganj, in Uttarakhand. This is likely to help the state’s textile industry take a major steps towards growth. Experts say surplus ground water in Sitarganj and proximity of Udham Singh Nagar to neighbouring countries like Nepal and China have attracted industrialists to the textile park. Another advantage is its border with Uttar Pradesh and good transportation facility to other parts of the country.
As per the State Industrial Development Corporation of Uttarakhand (SIDCUL), it will be the first Chinese company to make 100 per cent foreign direct investment (FDI) in India. Uttarakhand, is anticipating more Chinese firms to invest in the state in the future. This venture will also provide employment to around 8,000 people and with the inflow of textile industries, it will generate more options of livelihood.
Uttarakhand is a suitable business destination for industrialists due to benefits like rebate in per unit electricity bill, exemption from electricity tax, 50 per cent rebate in land for setting up textile industry.
French luxury brand Chanel is investing in workshops that will produce fine fabrics used for the brand’s clothing. Chanel will further expand investment in upstream production to ensure the future development of this type of fabric and silk. In addition, Chanel already holds a small stake in Denis & Fils, a specialized clothing and household goods company. It also produces solid colored jacquard fabrics. Denis & Fils is a high end silk producer in France.
These companies will provide Chanel a strong upstream supply chain. Chanel will soon equip these companies with high-tech equipment and machines. The brand is always in search of upstream suppliers of raw materials. Since 1984 Chanel has acquired at least 17 such workshops in France. Known for haute couture, Chanel was founded in 1909 by fashion designer Coco Chanel. Its products cover clothes, fragrances, eyewear, jewelry, handbags and watches. The brand is most famous for its little black dress, the Chanel No. 5 perfume and the Chanel suit.
The brand upholds a commitment to style, innovation and creativity and is known for uncomplicated luxury. Chanel continues to inspire women of all ages around the world with its timeless modernity.
Alok Industries, the textile player whose net worth has been eroded, has approached lenders for fresh funds so that it can increase production. The highly indebted textile company, which owes bankers a whopping Rs 20,000 crores, believes it can boost production if given access to more funds. The company reported a consolidated loss of Rs 3,774.2 crores for financial year 2016 on revenues of Rs 13,040.9 crores, down 46 per cent over financial year 2015.
Alok Industries management is trying to convince the State Bank of India that if it is lent fresh funds, its performance can improve. The company says capacity utilisation at its plants in Silvassa went up by about 10 to 15 per cent in the first quarter of financial year 2017. Last month, a court stayed sale of assets and change in the company’s equity structure, keeping banks from converting any loans into equity. The court’s order followed a winding up petition filed by HSBC on behalf of a clutch of unsecured lenders including VTB Capital to settle outstanding dues worth 55 million dollars.
While the RBI doesn’t prohibit banks from extending fresh loans to a defaulter, bankers are generally reluctant to do so.
The Comptroller and Auditor General (CAG) has pulled up the Apparel Export Promotion Council (AEPC) for the tendering process adopted for leasing of a furnished office accommodation. CAG says the process was ‘flawed’ as it extended undue benefits to a private party, leading to a revenue loss of Rs 17.42 crores. The AEPC published advertisements (August/September 2007) in newspapers for leasing of furnished office premises measuring 23,382 sq. ft. at Bhikaji Cama Place, New Delhi.
Three bidders were short-listed and called for negotiation. The CAG said though Teesta Urja did not participate in the tendering process, their bid was considered one week after opening of bids. Meanwhile, E-Square International did not turn up for negotiations and IPM sought one day to give its best offer on September but finally they also did not turn up. CAG said it is clear the tendering process for leasing of furnished office accommodation was flawed as AEPC failed to maintain the sanctity of the process.
According to the Accord on Fire and Building Safety in Bangladesh, till July this year, 64 per cent of safety faults in the readymade garment (RMG) factories that produce cloths for Europe retailers have been corrected. In a recent progress report the Accord said most of factories remained behind schedule in their remediation. The pace of remediation at Accord-covered factories further increased over the last months and 64 per cent of all safety issues from initial inspections were verified as fixed, the platform said.
As per the report, the electrical remediation achieved the highest 80 per cent progress while the structural remediation witnessed merely 40 per cent progress. And 60 per cent fire-related issues were fixed. During the inspection the Accord found 19,790 structural faults in the factories and up to July only 3,854 issues were corrected while out of 33,613 electrical safety risks 23,403 issues were remediated, the report showed.
Meanwhile, 15 factories completed all remediation works from their initial inspections and 34 factories were terminated due to failure to implement the workplace safety measures. The Accord conducted initial inspection in 1,648 factories and out of them 1,402 factories remained behind the schedule in implementing the corrective action plan. More than 100 Accord-appointed engineers conducted between 400 and 500 follow-up inspections each month.
"The recently concluded Intertextile Pavilion Shenzhen wrapped up its 2016 edition with nearly 15 per cent increase in visitor figure, welcoming over 17,000 visitors from 37 countries and regions. The top 10 overseas visitors were: Hong Kong, the US, Canada, India, Russia, Singapore, Korea, Australia, Japan and Turkey. Moreover, a total of 675 exhibitors from seven countries took part this year."
The recently concluded Intertextile Pavilion Shenzhen wrapped up its 2016 edition with nearly 15 per cent increase in visitor figure, welcoming over 17,000 visitors from 37 countries and regions. The top 10 overseas visitors were: Hong Kong, the US, Canada, India, Russia, Singapore, Korea, Australia, Japan and Turkey. Moreover, a total of 675 exhibitors from seven countries took part this year.
Thriving demand in South China
The uncertain global economic situation didn’t dampen the enthusiasm of exhibitors who were keen to explore opportunities in South China market, with many opining that they experienced high demand in the fair. First time exhibitor WIG Korea has just begun to develop its business in the China market and chose Shenzhen as the entry point.
The organisers of the Taiwan and Korea Pavilions were optimistic about the South China market. As John Lee, Director of the Exhibition Project Division of DGTIA, Korea, pointed out Shenzhen is a fast-growing city being a Special Economic Zone. More than 3,000 garment factories are located here, which creates enormous demand for apparel fabrics and accessories. Korean exhibitors believe that this fair is the best platform for them to reach new buyers and develop their businesses in this favourable market.
Agreeing with Lee, Petra Peng, representative of the Taiwan Textile Federation said that this market contains ample opportunities. More than 75 per cent of fashion brands in South China are keen to purchase high-quality overseas products. To cater to Taiwan suppliers’ growing interest in the South China textile market, the pavilion organisers debuted a business-matching event on the first day. Peng introduced the strong buyer profile she saw in the pavilion business matching session, saying: “Over 20 domestic brands attended the events, and many of them have their own subsidiary brands or several product lines, and they have very high demand for quality as well as innovative products.”
Effectiveness and high-quality buyer profile
To tap the potential South China market, new overseas suppliers debuted at the event. Many reported they had exceeded their target result because of the high-quality trade platform and buyers. Toru Maekawa, General Manager of Toko Shoji’s Sales Department, explained: “Our target buyers – leading fashion brands from Hong Kong including Marc O’Polo, Ralph Lauren, DKNY and Givenchy – have already visited our booth and placed sample orders with us. In fact, we were surprised to receive other buyers that we weren’t expecting, such as garment manufacturers as well as mid-level fashion brands from Beijing and Shanghai who were also sourcing here. The overall result exceeded our expectation.”
Indian manufacturer Texorange Corporation debuted Indian lace and embroidery at the fair. Managing Director Vikas Jhawar was thrilled with the result. He said that they connected with a number of quality buyers in the fair. They had very serious business discussion with almost 20 Chinese retail brands and overseas buyers in the first two days.
High quality of products on offer
Buyers too expressed their appreciation for the high-quality sourcing options. One of the invited VIP buyers, Connie Chiu, Senior Manager (R&D) of Marc O’Polo Hong Kong, said she found several potential suppliers and discovered new materials in the international area.
For the first time, Hong Kong & Kowloon Spinning Weaving and Dyeing Trade Workers General Union (HKSWD) led a VIP delegation group to the fair. The delegation included product managers, sourcing officers and textile texting specialists, and all of them had very positive feedback on the quality of the products the fair featured.
Amongst the visitors were many top international fashion brand buyers, such as Brooks Brothers, Combi, Descente, Diesel, DKNY, Evisu, G2000, I.T, Initial, KINJI, Macy’s, Marc O’Polo, Pepe Jeans, Ralph Lauren, Zara and many more. In addition, the fair attracted a number of well-known domestic brands including 6IXTY 8IGHT, Bosideng, Canto Motto, Cosmo Lady, EITIE, Goelia, Lilanz, Septwolves, WSM and more.
The next Intertextile Pavilion Shenzhen will take place in mid-July, 2017 at the Shenzhen Convention & Exhibition Center again. The next Messe Frankfurt apparel fabrics and accessories fair in China is Intertextile Shanghai Apparel Fabrics – Autumn Edition 2016 which will be held in Shanghai from October 11-13.
