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Jordan Lea has been elected the President of Cotton Council International (CCI) for the year 2014, during the organization’s board meeting held during the National Cotton Council’s (NCC) recent annual meeting. CCI is the export promotions arm of the NCC and carries out programs in more than 50 countries globally under the Cotton USA trademark.
Lea, a merchant with Eastern Trading Company in Greenville, SC, succeeds John Burch, a Bakersfield, CA, cooperative official who is now CCI Board Chairman. Lea is a past Chairman of the American Cotton Shippers Association, and serves on the Board of Directors of the NCC and The International Cotton Association.
Other CCI officers elected during the meeting are: Dahlen Hancock, Ropesville, TX as first Vice President, Keith Lucas, Garner, NC as second Vice President, Anthony Tancredi and Cordova, TN as Treasurer. Mark Lange of Cordova, TN, was re-elected as Secretary, and Kevin Latner of Washington, DC, was elected as Assistant Secretary. E. Hope (Hopie) Brooks, III, Cordova, TN; James Massey, Harlingen, TX; and Cannon Michael, Los Banos, CA, were newly elected as CCI directors for 2014.
www.cottonusa.org
Wallace Darneille, a Lubbock, TX, cooperative marketer, was elected as the Chairman of National Cotton Council for 2014 during the National Cotton Council’s (NCC) annual meeting held in Washington. Darneille, President and CEO of Plains Cotton Cooperative Association, succeeds Jimmy Dodson, a Robstown, TX, cotton producer as Chairman.
Darneille has a long record of outstanding service to the NCC and to the US and global cotton industries. This past year, he served as NCC Vice Chairman and was the Chairman of Cotton Council International (CCI) in 2011, after serving as its President in 2010. He also served as Chairman of the National Council of Textile Organizations in 2009-2010, and was President of the Liverpool, England-based International Cotton Association in 2007.
Previously, he was President of the Texas Cotton Association, as a member of the Executive Committee of the National Council of Farmer Cooperatives, and as a board member of CCI, the American Cotton Shippers Association, the Texas Agricultural Coop Council, Telmark, Denimatrix and The Seam.
Other office bearers elected to serve the NCC in the coming year include: Sledge Taylor, Como, MS as Vice Chairman, Clyde Sharp, Roll, AZ as Secretary-Treasurer, Joe Nicosia, Cordova, TN as Vice President, Coalter Paxton, III, Wilson, NC as Vice President (Warehousers), Meredith Allen, Greenwood, MS as Vice President (Cooperatives), Sid Brough, Edroy, TX as Vice President (Ginners), John Fricke, Pine Bluff, AR as Vice President (Cottonseed) and Anderson Warlick, Gastonia, NC as Vice President (Textile Manufacturers).
www.cotton.org
About 100 Indian companies are expected to exhibit their products at ITMA Asia and CITME 2014, one of the largest textile machinery expos to be held in Shanghai, China from June 16 to 20, 2014. The event would host over 1,500 exhibitors from 26 countries. The exhibition would be spread over 1.5 lakh sq. mt. in 13 halls and is expected to attract over 1.1 lakh visitors. Machinery related to spinning, non-woven, weaving, knitting, printing and dyeing and other segments of the textile value chain would be exhibited.
This year, printing is one of the focus areas. With labor costs going up, textile units require automated solutions and this would be highlighted at the exhibition. The participation from India this year would be 50 per cent higher compared to previous editions held in China in 2012. About 3,000 Indian visitors are expected at the expo. ITMA organised road shows in eight Indian cities to create awareness about the exhibition.
Since 2008, the combined show known as ITMA Asia and CITME has been held in China every two years. The event features the unique strengths of the ITMA brand and China’s most important textile event, CITME.
www.itmaasia.com/
Bangladesh’s apparel industry is set to overhaul itself with modern machinery and tools, which garment makers believe will make their products cost-effective and enhance their ability to compete in the global market. For one, they are investing in machinery from Germany which will minimise production cost, upgrade quality and reduce waste. Factory owners say these machinery can produce apparels quickly with comparatively smaller number of workers.
Scarcity of skilled sewing operators for making high-end garments is a reason behind installing of such expensive machinery. Buyers are pushing factory owners to install modern equipment to ensure timely shipment and better quality of readymade garments. Buyers are often more flexible while negotiating if they find latest machinery in a factory.
No wonder, garment makers, mostly second-generation entrepreneurs, are replacing existing equipment with the latest hi-tech machines. Soon, these equipments are expected to replace all traditional ones. Meanwhile garment machinery manufacturers are also happy with the sudden surge in demand. However, though modern equipment is helping exporters, the high cost involved is a major detractor for quick installation.
Boeing supplier Toray Industries is planning to invest $1 billion and hire 500 employees over the next 10 years at a brand new 400 acre carbon fiber manufacturing facility in South Carolina, US. Toray is based in Japan. It is one of the world's largest producers of carbon fiber and the South Carolina plant will make high-performance carbon fiber for the aerospace industry.
The aerospace industry is growing in South Carolina. The state has more than 200 aerospace companies. Toray will also receive tax breaks that would kick in after the state certifies the company has met its jobs and investment targets.
Toray Industries sees South Carolina as an ideal location for its next North American manufacturing facility since it will have proximity to major customers, both in the US and in Latin American markets. Toray views the United States as a key expansion market for the company due to the revival in manufacturing that is pushing demand for advanced materials, particularly those used in the aerospace and energy-related industries.
Toray Industries manufactures and sells fibers, textiles, plastics, chemicals, IT-related products, carbon fiber composite materials, environment and engineering products and systems, and life science products worldwide.
www.toray.com/
Kenya is luring global textile firms to invest and set up manufacturing units in the country. It has started off by setting up three special economic zones that would offer tax breaks. The country has a diversified economy, and is popular with tourists, but exports are dominated by farm commodities with volatile prices and low returns. Building up industry is vital for Kenya to plug a persistently wide current account deficit, projected to stand at 8.4 per cent of gross domestic product by June.
The special zones would be located near ports and offer incentives such as land for lease and tax breaks that include duty-free imports and waivers on VAT. The aim is to attract western companies who would otherwise go to Myanmar, Vietnam or China. The zones are designed to create 10 million jobs in the next 30 years. Once running, the zones would allow companies to cut down on red tape. Businesses have long complained about bureaucratic hurdles.
<br/>Kenya may also find itself battling regional rivals like Ethiopia, one of sub-Saharan Africa’s fastest-growing economies, which is also setting up new industrial zones and has attracted interest from global fashion retailers such as Hennes & Mauritz.
Kenya is the main trade gateway to east Africa. Africa is becoming the future market for many companies worldwide.
Levi Strauss has created a process for using 100 per cent recycled water in parts of its garment production. The jeans manufacturer wants to reduce its impact on the world’s water resources.
The process is being used in one of the brand’s key China unit, which bleaches, dyes and stone washes garments to achieve a specific look or feel. The factory, located in southern China, worked with Levi Strauss to engineer a system to pipe 100 per cent recycled water into an industrial laundry machine used for finishing one of its jeans lines. Some 1,00,000 pairs have now been produced with the new technology. The goal is to eventually use 100 per cent recycled water to finish a broader range of Levi Strauss products at factories in other parts of the world.
However, there are different definitions of 100 per cent recycled. Saying a garment is made from 100 per cent recycled water is not the same as saying that 100 per cent of the waste water is recycled. For example, there's no economically feasible way to recycle 100 per cent of laundry machine water in a closed loop system. It requires membrane technology that may triple or quadruple the cost of water treatment. That’s a cost that most consumers won’t accept.
www.levistrauss.com/
Leading garment exporters in Nepal are lobbying for the introduction of cash incentive scheme for the benefit for export community. Making amendment to the cash incentive guidelines last year, the government had removed the incentive scheme based on value addition. It had made all exports with value addition of a minimum of 30 per cent eligible for cash incentives as demanded by the private sector. It had also introduced incentive of one per cent for the listed 22 products and two per cent for 10 other products.
Now exporters are putting pressure on the government to re-introduce the incentive scheme based on value addition. Under the cash incentive scheme based on value addition, exporters could get two per cent incentive for exports with 30 to 50 per cent value addition and three per cent cash incentive for products having value addition in range of 50 to 80 per cent. Exports having value addition of more than 80 per cent were eligible for four per cent cash incentive.
The ministry of Commerce and Supplies has now formed a six-member study panel led by Director General of Department of Industry Dhruba Lal Rajbanshi to recommend second amendment to the cash incentives guidelines. After the first amendment to the regulation, the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), Confederation of Nepalese Industries (CNI), and Nepal Chamber of Commerce (NCC) started issuing Certificate of Origin stating that exports have 30 per cent value addition. They used to study the certificates without evaluating value addition of exports.
While exporters have denied accepting cash incentives this year, in a bid to pile pressure on the government to amend the guidelines. The government has allocated Rs 300 million for distribution of cash incentives in the current fiscal year.
At a recent CITI conclave held in Ahmedabad, Gujarat, the doyen of the Indian textile industry, Sanjay Lalbhai, CMD of textile conglomerate Arvind spoke at length about India’s position in global textile market and how we can race ahead to achieve the ‘Brand India’ status. Speaking to Arvind Singhal, Chairman, Technopak Advisors, he answered several queries related to state of textile industry, Lalbhai said, “Indian textile companies need to go vertical and also set-up large scale apparel manufacturing plants, if India wants to increase its market share in the global textile trade.”
Need to gain competitiveness
Singhal pointed out that in the early ’90s, China’s and India’s textile industry were not 
too far apart. However, today China’s industry is seven times that of India’s. Explaining the reason behind this Lalbhai said world trade in 2003 was $430 billion (over Rs 25,00,000 crores) by 2012 it was $750 billion dollars (over Rs 45,00,000 crores). It’s likely to be $1,150 billion (over Rs 69,00,000 crores) by 2020. In 2003, we were 3 per cent of world trade, by 2012 we were 4.5 per cent, while China was 17 per cent in 2003, now its 33 per cent. The reason behind this is that India has not been able to think ‘scale’. We have not gone for ‘verticalisation’.
He stressed on the need to grab business away from China, especially when China has become more expensive than India. “We still depend on Bangladesh, Cambodia, Vietnam, Sri Lanka to convert our fabrics into garments. Major buyers in the US and Europe want to shift business from China to India but they don’t know where the conversion to the final garment will happen. Bangladesh is facing compliance issues. So things are uncertain there. India should take up garmenting seriously and build scale,” he asserts.
He also emphasized that we have to take advantage of the domestic market and create scale. “It’s necessary to have scale in value based products. We require a more competitive framework in raw materials. There are companies in raw materials where scale is not an issue. Even with cellulosic fibers there are huge opportunities in women’s wear. We can bring joint ventures into the country,” he explains.
Finding of textile sector’s strengths
Despite Indian textiles industry being the largest employer, contributing to the GDP, it has not been able to create good value to its investors. “It is the joint effort of players put together that textile should give value to its investors. People who are investing in our companies want good returns. These are the challenges and the problems which the textile industry has faced and I would say all of us have faced,” he opines.
Elaborating on creating an “asset light” model, he said, “There are so many entrepreneurs in India today who are willing to invest in a spinning capacity, so many investors are ready to invest in our weaving capacity. What we have started doing is, when an entrepreneur approaches us with investment proposal, we say, we assure you 18 per cent return on your investment. Now where would you get 18 per cent return, it is not that simple.
However, luckily, he says, we are the most supported industry in the country. “We have got good support from the government. We should always invest in value added areas like processing, distributions; invest in creating a capability of products and design innovations, becoming more customers centric. We should look at the development of clusters like Tirupur, Surat or Bhiwandi in the textile industry. We should look at creating an asset light model, so that I can go back to my investor and say now rate my textiles at par with brand & retail. We should rethink and if the Top 20 companies do not rethink this the industry will not get re-rated. It is a joint responsibility,” he avers.
Lalbhai said that there are companies in China which are trading at big PE. There are hardly any companies which are trading big on PE. It is not that these companies in China are very different and the idea cannot be replicated here. Possibilities are everywhere, brand India will only emerge if we become customer centric. He rued that our mentality is more towards creating assets, which is the easiest thing to do. We always look to invest in modern machinery, get subsidy from the government, run it as easily as possible.
He stressed on the need to bring in professionalism into the business. “You have to create value and bring in the best minds. You have to create a younger organisation. You can’t create scale without empowering. This is what has to be done for creating value additions in textiles,” he summed up.
Not satisfied with its trade in cotton and textiles with Vietnam, India is now looking at pushing up business. The market share of Indian cotton fiber in Vietnam was 16.5 per cent last year, far below the average level in other markets. Cotton fabric has a 0.58 per cent market share in Vietnam – much lower than the average world level of 26 per cent. As a result, a 20-member business delegation operating in fabric, cotton fiber, denim and jeans cotton from India is visiting Vietnam to seek cooperation opportunities in that country.
In 2013, Vietnam exported garments and fibers worth over $77 million to India, a year-on-year increase of 38 per cent. It imported $419 million worth of garment materials from the South Asian country, up 46 per cent. India feels it can supply Vietnam quality yarns and fabrics at the right price since India has emerged as the world's most competitive manufacturer of these products. Indian textiles are seen as a good partner for Vietnamese textiles to reduce cost of production.
Despite inflation, rising labor costs and a limited value chain for textiles, Vietnam is still one of the fastest growing textile and apparel producers. By 2025, the Vietnam textile and garment industry is expected to produce $35 billion worth of apparel exports, double the current production.
