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As per Vietnam Cotton and Spinning Association, developing the fabric and dyeing segments would be the key factor in the growth of garment and textile industry in Vietnam. Despite being the second biggest exporter of textile and readymade garments globally, Vietnam is yet to fully exploit its true potentials, thanks to its incompetent dyeing facilities and its increasing dependence on imported fabrics. As per available figures, In 2017, Vietnam imported 6.5 billion metre of fabric, or two-thirds of the industry`s total requirement.
Considering that 750,000 tons of Vietnam’s fibres (two-third) make way overseas at lower prices every year, the increasing fabric imports sound rather contradictory. Industry insiders blame the poor development of the dyeing segment for the same. Industry insiders further added that local companies lack proper awareness about dyeing process alongside technology, human resources and skills required to develop this sector.
Polyester/cotton yarn mills reported a slump in their overall demand this year, partly owing to the surge in supply caused by previous production shift and partly due to the change in market sentiment owing to the trade war. As the CCF Group notes, after initial smooth sales and low inventory in end-2018, the sales of polyester/cotton yarn stagnated with its inventory averaging at 20 days or above.
Based on downstream plants, the sales in major producing areas are moving slowly with both domestic and foreign sales being under unprecedented pressure. For example, Henan, Shandong, Fujian, Jiangsu and Zhejiang are witnessing continuous high inventory pressure with many medium-sized enterprises cutting their productions largely.
For example, the largest cotton yarn producing area, Shandong is highly burdened with unsold inventory this year as the demand has not improved even though the prices have been lowered. Other regions face the same issue more or less. In South China, many spinners transfer to produce polyester yarn instead of polyester/cotton yarn, which is also a miniature of spinners’ expectation to later market.
The Mercedes-Benz Fashion Week Madrid has updated the dates of its 2020 summer edition. Instead of being held in July as previously planned, the event will now be held from June 23-28, 2019. The Madrid Fashion Week is keen to attract foreign interest, and its last two summer editions had already been brought forward to July from September.
Designers had requested the former fashion week director Charo Izquierdo, who stepped down from her role a few weeks ago, to change the dates of the fashion week. The change to the calendar was formally put in place after several discussions with the new management.
The last edition of the Madrid Fashion Week, featured over 40 designers who presented their offerings for spring/summer 2020. The next edition of the event will be held from January 23-28, 2020.
Kumar Mangalam Birla has been appointed the new chairman of Century Textiles and Industries after the death of his grandfather Basant Kumar Birla. Birla joined the board of Century Textiles in 2006 and in 2015 became its vice-chairman. The board of Century Enka elected Rajashree Birla as chairperson. She was the vice chairperson before. Basant Kumar's daughter Manjushree Khaitan was re-designated as chairman of Kesoram Industries.
Khaitan relinquished her position as executive vice-chairperson and would continue on the board as a non-executive director. She had been on the board of Kesoram since 2001. Basant Kumar's other daughter Jayashree Mohta is the vice-chairperson of Jay Shree Tea & Industries.
India has taken several steps for the promotion of investment, exports and creation of new job opportunities in the textile sector. GST on manmade fiber yarns has been reduced from 18 per cent to 12 per cent. GST rates for garments and made-up articles not exceeding Rs 1000 a piece are five per cent of the sale value and 12 per cent for articles of sale value exceeding Rs 1000 a piece. Accumulated input tax credit on fabrics will be refunded. This is aimed at reducing the cost of fabrics, which are major inputs for garments.
The package offers Rebate of State Levies, labor law reforms, additional incentives under the Amended Technology Upgradation Fund Scheme and some income tax relaxation. A 40 per cent subsidy is being provided for setting up textile parks. A scheme has been launched for boosting production in knitting and knitwear clusters. The Samarth scheme will train 10 lakh youngsters for a period of three years at an estimated cost of Rs 1300 crores. Total compensation under the remission of state levies scheme and a new scheme to reimburse against embedded central taxes (even after the GST rollout) will be raised to 6.05 per cent (of freight-on-board value) for garments and 8.2 per cent for made-ups from the current 1.7 per cent and 2.2 per cent respectively.
India’s apparel exports have increased by two per cent from 2015 to 2018. The country faces competition from Bangladesh and Sri Lanka which have competitive manufacturing costs and enjoy duty free access to major markets like the EU. So some garment units have set up units in Ethiopia due to zero duty access for Ethiopian exports in the US and the EU and due to incentives being offered for investments there. A special package for garments and made-ups offers labor law reforms, additional incentives under the Amended Technology Upgradation Fund Scheme, enhanced duty drawback coverage and relaxation of income tax rules. Rates under the Merchandise Exports from India Scheme have been enhanced from two per cent to four per cent. The interest equalization rate for pre and post shipment credit for exports by micro, small and medium textile units has been enhanced from three per cent to five per cent. Benefits of the interest equalization scheme have been extended to merchant exporters, something that was earlier limited to manufacturer exporters.
India’s apparel exports fell by 1.2 per cent in fiscal year ’19 from fiscal ’18, which in turn was four per cent lower than the previous year. The share of apparel exports in the country’s total textile exports fell from 51 per cent in fiscal ’17 to 45 per cent in fiscal ’19.
The Ellen MacArthur Foundation, a nonprofit focused on the circular economy and sustainable practices, recently released a set of guidelines called the "Jeans Redesign," which strives to address waste within the denim industry by setting minimum requirements around materials, durability and more. The guidelines are based on the principles of the circular economy and will work to ensure jeans last longer, can easily be recycled, and are made in a way that is better for the environment and the health of garment workers.
Big brands are already taking note of this, as evidenced by the fact that Wrangler, Made well and Gap have already signed on to participate in the foundation's call for more sustainable denim. However, besides these well-known brands, a handful of independent brands are also opting for eco-friendly denim like the brand Boyish, who has formulated a top-to-bottom sustainability model that uses one-third the typical amount of water required for production. The brand’s dyeing process leverages reduced indigo with 80 per cent less sulphates and caustic soda than standard dye. Around 20 per cent of the brand’s products are made from deadstock or vintage fabrics that are then turned into new items.
Another denim brand Warp + Weft recently saved over 572 million gallons of water thanks to the implementation of eco-friendly production methods.
View Premium Selection was held in Germany, July 16 to July 17, 2019. Leading international fabric, trim and denim suppliers presented more than 400 collections featuring their preview programs and current developments for the new autumn/winter 2020-21 season. The focus was on expressive, distinct velvets, vinyls, reflective surfaces, cords, transparencies, batiks, jacquards, burnouts, new camouflage and leopard prints as well as glitz and glamour in surprising color combinations and in a diverse range of techniques. A new circular holistic approach showcased bio-based or bio-engineered materials, new alternative qualities and the revitalisation of recycling and post-consumer waste.
The trade fair provided textile industry with valuable insights into current material innovations, color trends and future-oriented qualities, with which they could get a head start for planning and designing new collections.
A selection of ReSource articles was presented, enabling the early sourcing of sustainable and ecologically certified fabrics and trims. The latest material innovations were presented. There was a rethinking throughout all sectors and stages of the textile and fashion industry about sustainability, conscious consumption, resource saving processes, efficiency and quality. The topic of digitising materials promised both more sustainable and more efficient process solutions across the entire value chain, especially in design.
Cotton makes up 51 per cent of the total raw material cost in the Indian textile industry. It continues to remain at a higher level, thereby pressurising domestic industry margins.
Globally, the spread between international cotton prices and domestic cotton prices has been on a declining trend owing to higher production in Brazil and China, aided by lower production in India. This decreasing price spread, along with a gradual improvement in demand, provides the much-needed respite for cotton industry players. Capital expenditure in textiles has been majorly to replace machines with new technologies.
Meanwhile, yarn production has been fluctuating over the last six months, although the production average has been maintained. Exports have risen to more than 30 per cent during March 2019. Prices of cotton yarn are co-related to raw cotton prices and thus have seen an upward movement in line with raw cotton prices. Synthetic fabrics have seen a gradual revival in demand due to decreased cost of production. Falling crude oil prices have made synthetics more competitive against increasing cotton prices. Partially-oriented yarn and texturised yarn prices declined by eight per cent and seven per cent month-over-month respectively. Overall apparel production improved by about 34 per cent year-on-year and exports improved by 18 per cent year-on-year.
For the four months upto June, Asos’ total revenue grew 12 per cent. UK retail sales rose 16 per cent. But in Europe and the US, sales were held back by operational issues associated with Asos’ transformational warehouse programs. EU retail sales rose just five per cent in the four months reflecting weaker stock availability than planned due to the challenge of embedding new automation software in its euro hub. Despite similar warehousing issues at its US hub, sales in the US still rose 12 per cent in the four months. US sales were helped by currency effects.
All of this added up to a nine per cent increase in international retail sales for the four month period and a ten per cent rise in the year-to-date. The multi-brand store is seeing positive momentum in customer engagement with visits up 16 per cent year-on-year. The company is making good progress in improving customer engagement, but embedding the change from the major overhaul of infrastructure and technology in its US and European warehouses has taken longer than anticipated, impacting its stock availability, sales and cost base in these regions. The move to a multi-site logistics infrastructure will enable it to offer customers across the world its market-leading proposition, facilitate its future growth as well as lead to longer-term efficiency benefits.
