FW
For the first quarter, Indonesian exports of non-knitted clothing declined by 2.9 per cent while shipment of knitted goods dropped by 4.9 per cent. Indonesia is preparing to start talks on the long-delayed comprehensive economic partnership agreement with the EU, which is expected to boost the competitiveness of its products to the 28-member bloc.
Without free trade deals, Indonesian textile and garment producers are currently being charged duties ranging from 11 to 30 per cent to main export destinations, including the EU and US. The trade arrangement may push down levies to as low as zero per cent, resulting in an enhanced edge of traded goods in terms of price.
Indonesia has seen its share decline in textile trading with major partners from 2007 to 2013. New challenges have been faced in recent years, including automatic electricity-price adjustments. Power prices fluctuate each month depending on the rupiah exchange rate, crude oil price and inflation.
Depreciation of the local currency against the dollar has been pushing up electricity rates, which contributes between 18 per cent and 26 per cent to costs in the textile and garment industry. Indonesia’s main destinations of textile and textile products are the US, Japan, Turkey, Germany and South Korea.
Euratex, the European Apparel and Textile Confederation, has launched the Energy Made-to-Measure (EM2M) campaign. Sustainable use of resources is among Euratex’s key priorities. Launched in 2014 by Euratex in collaboration with dozens of organisations across Europe, the EM2M campaign promotes key results of successful initiatives for energy efficiency in the sector.
It aims at supporting textile and clothing companies, especially small and medium enterprises, which are not fully aware of their actual energy consumption and of the saving potential. The campaign provides companies’ managers with tools, best practices and training to take informed decisions to launch energy efficiency actions.
With a new focus on energy efficiency in textile production processes, Energy Made-to-Measure in 2015 starts collaboration with the initiatives of two national associations of textile machinery manufacturers – VDMA in Germany and ACIMIT in Italy.
VDMA is a German engineering federation and the largest engineering industry network in Europe. VDMA’s Blue Competence initiative supports sustainable textile production realised by more sparing use of resources and more efficient manufacturing processes. The Energy Made-to-Measure campaign was invited to present at the annual VDMA press conference held at Techtextil in Frankfurt.
ACIMIT (Association of Italian Textile Machinery Manufacturers) promotes the Italian textile machinery sector and supports its activity, mainly abroad, through updated and innovative promotional means.
www.euratex.eu/
Techtextil and Texprocess exhibitions were hosted in Germany on May 4 to 7. These international trade fairs showcase a spectrum of materials, processes and technologies for the entire textile value chain. Altogether, 1,662 exhibitors from 54 countries presented their new technical textiles, nonwovens and processing technologies for textile and flexible materials.
Techtextil and Texprocess 2015 showed themselves to be the undisputed centre for innovation in the field of high tech fabrics, smart textiles and processing technologies. Significant increases in visitor numbers were registered from countries like Egypt, Bangladesh, China, Portugal, Romania and Spain.
Techtextil presented innovative fibers used in the agricultural, automotive, construction, apparel, energy and medical fields. Exhibitors also presented synthetic fibers for covering stadiums or for tarpaulins as well as non-combustible glass-fiber mats for seats, flooring and luggage racks. In addition to multi-function jackets that can communicate, warm and illuminate, other highlights at Techtextil included embroidered electrodes for long-term ECGs, algae-based artificial snow, an artificial womb for premature babies and a maritime textile for cultivating kelp.
One of the top subjects at Texprocess was Industry 4.0, the fully-automatic, digitalised and decentralised production. Industry 4.0 has a great potential for the garment and leather technology sector, which needs fast and fully integrated production processes to cater for the numerous collections.
www.techtextil.messefrankfurt.com/
Vardhman Textiles posted a net profit of Rs 90.20 crores compared to Rs 154.32 crores for the March quarter. The fall in profits came on the back of higher depreciation. The lower margins are on the back of higher raw cotton prices. Total debt as on March 31 is close to about Rs 2,000 crores. Primarily majority of debt is covered under TUF which is a subsidised debt.
There is not much of an inventory build-up. Generally Vardhman works on a 30-day inventory or finished goods. Last year, the company could cover the quarter 2013-’14 at reasonable prices and as a result margins were better. This year, there was a reversal. The quarter during the peak season was at much higher prices which later on came down and as a result, prices got adjusted to that. So, for anyone who had stocks of cotton, this was a disadvantage.
This year there was a change in the depreciation method because of the change in the act. The depreciation required to be provided was much higher than last year’s figure, so almost Rs 150 to Rs 175 crores is the impact of that. These are the two major reasons for drop in margins. On topline, not much capacity has been added since last year. However margins are expected to be better compared to last year.
www.vardhman.com/more_vardhman.asp
Aubervilliers, a town on the northern edge of Paris has generations of Chinese settlers. Traders recently opened the continent’s biggest garment centre where a vast range of clothing is on offer. Hundreds of wholesalers offer endless choices of textiles, colors and patterns in this vast district.
The center aims to draw buyers from across Europe and make the textile import-export trade more efficient by consolidating business in one location. The project is being seen as beneficial for the French economy. The fashion center is now Europe’s biggest wholesale textile market with 310 shops in 55,000 sq. mt. in the heart of Aubervilliers. The town has become one of the most important places for business and exchange with China in all of Europe.
In the maze of alleys and dead ends, almost all family businesses are run by people from Wenzhou region of Chian, a town in southeast of the country where emigration is a deep-rooted tradition. With the city today counting about 1,200 Chinese traders – not including laborers and other employees – Aubervilliers has become the main commercial junction between France and China.
There is a new generation of businessmen who have arrived, who are French of Chinese origin and who speak French.
Cashmere is a luxury product that finds customers as far away as the United States, Britain and Europe. Afghan farmers not long ago collected the thick winter undercoat their goats shed every spring and threw it on the fire to heat their homes and cook their food.
The super-soft fluff that comes off in clumps as the weather warms up, and is cleaned, refined and spun into yarn is cashmere. Traders, processors, donors and international businesses are cottoning on to Afghanistan’s potential as a major producer of cashmere. The Afghanistan government has also recently come up with a cashmere action plan, having recognised potential for cashmere and aiming to target the highest end of the global luxury market, where a designer-label cashmere sweater can cost $1,000.
Years after the 2001 US invasion of Afghanistan, which ousted the Taliban, foreign businesses started arriving, investors willing to bring money and expertise to develop a profitable, niche market. Only about 30 to 40 per cent of Afghanistan’s seven million goats are combed for cashmere, even though up to 95 per cent of the animals could become part of the production chain. Most of the raw product is bought by traders who sell it to Chinese middlemen to feed the mills that produce affordable clothing for much of the world.
The global market value for cashmere is over a billion dollars. As China is known to blend different qualities of cashmere to achieve volume, the top end of the market is wide open for the unadulterated Afghan product.
Himachal Pradesh's weaving industry has been left high and dry in the wake of the Union government stopping subsidy on woolen yarn. Weavers in neighboring Uttarakhand and Jammu & Kashmir, where weaving industry depends on wool, also face an uncertain future.
There are about 22,000 weavers in Himachal alone, while the number in two neighboring states is much higher. In addition there are thousands of families who run small looms at their homes, and aren't registered with any co-operative. It is feared ending the subsidy on woolen yarn will rob weavers of their jobs, and affect their families, as most of them come from poor backgrounds.
The decision will have economic and social implications. A large number of women in hill states rely on weaving and they would be the worst hit from this move and left idle. The weaving industry in Himachal Pradesh is dependent on woolen yarn as silk and cotton are not locally available. The downward slide in the industry began in the late 90s owing to increased competition, lack of promotion and market accessibility.
The all India handloom board had announced a 10 per cent price subsidy on woolen yarn in addition to cotton and domestic silk yarn in February 2014.
Apparel manufacturers based in Europe and China are likely to expand their businesses in Sri Lanka if the country can revive the EU GSP Plus by next year. Sri Lanka has been in discussions with the European Union to ascertain how to revive the GSP Plus trade concessions that would likely be implemented in 2016.
In the wake of these developments, overseas apparel manufacturers in Sri Lanka are likely to expand their capacity. European investors are keen on expanding their production if GSP Plus concessions are available. Investors already manufacturing out of China also want to expand their capacity in Sri Lanka. China’s labor wages are increasing and in comparison Sri Lanka seems more competitive at lower rates.
The industry is awaiting final talks between the government and the US authorities on the possibility of gaining market access especially through negotiations underway on the Trans Pacific countries that could impact on Sri Lankan trade if this agreement was to go ahead.
There is increased local investment in the North and East. Manufacturers want to cash in on the opportunities to get access to EU markets when the EU GSP Plus concessions are revived.
Europe has increased a retaliatory tariff that it imposes on women’s blue jeans imported from the United States. As of May 1, the additional tariff, which is added to the already 12 per cent tariff on US denim pants, went from 0.35 per cent to 1.5 per cent. That makes the total EU tariff on women’s blue jeans imported from the United States rise to 13.5 per cent, compared with 12.35 per cent last year. The 1.5 per cent retaliatory tax is a pittance compared to the 26 per cent additional tariff imposed on US women’s denim pants on May 1, 2013.
The extra 26 per cent tariff was part of a trade dispute that centered around the Byrd amendment, by which the United States collected extra duties several years ago on EU- made items that were considered to be unfairly traded goods that affected US manufacturers. Even though the Byrd amendment was rescinded, the United States continued distributing the money collected under the Byrd amendment, to which the EU objected. Due to this, the World Trade Organization authorized the EU to increase tariffs on certain US items for a one-year period, with the option to renew the tariff—either increasing it or decreasing it.
Since the United States reduced by nearly 50 per cent the distribution of Byrd amendment duties, the EU decided in 2014 to reduce the extra denim tariff, which was costing some Los Angeles denim makers as much as 2,50,000 dollars during a six-month period.
Interfilière Paris and Paris Capitale de la Création have recognised Italian company Eurojersey, for the production of patented warp knit sensitive fabrics, as the ‘Designer of the Year’ in the beachwear category.
Since its creation in 1960, Eurojersey has been innovating, creating and improving its performance and the quality of its fabrics. The company pays particular attention to quality and the sustainable development of its large-scale production owing to its ‘Sensitiv Eco System’ project. The company has invested in ethical technologies, optimized production processes and saved resources.
Developed in 1989, Sensitive Fabrics are designed as lightweight, breathable, and versatile, with unique technical features and functionality and meet the most modern solid and printed trends. They are suitable for ready to wear, lingerie, beachwear and sportswear collections. These fabrics allow body mapping and matching between different materials, using bonded and taping technology.
The latest application techniques, including contouring, laser cuts and flocking, expertly bring about the performance of Sensitive Fabrics, according to the manufacturer.
www.eurojersey.com
