FW
Tirupur Exporters’ Association has heaved a sigh of relief as the district administration allowed units in the city to resume operations, though by strictly adhering to the safety guidelines.
The association had written to Central and state governments seeking reopening of the textile hub, so that they can send samples to clients in the US and Europe and retain export orders for spring-summer collection. Else, they could have lost the orders to countries like China, Bangladesh and Pakistan, where factories were functional. The relaxation has brought relief to the sector.
In the first phase, at least 600-700 export units will resume operations with at least 25 per cent of the workforce. TEA president has assured that the units will follow all sanitation measures and also main social distancing.
US imports of denim decreased significantly in the first three months of the year. For the year until February, US companies imported 14.32 per cent less blue jeans – of which 97 per cent are denim – at $497.08 million. The downturn was driven by China’s 63 percent drop to $55.77 million, with factories shut down as the nation swept COVID-19. In the first two months of the year, the shipments of Mexico’s largest denim supplier declined by 27.2 per cent to $ 91.98 million.
Certain suppliers in the top 10 that reported a decline in the era included Indonesia with a decline of 34.92 percent to $9.17 million and Nicaragua with decline of 2.99 percent to $13.85 million. In the period there were winners in denim import sourcing, led by Bangladesh, with an increase of 39.59 per cent to $90.13 million, and Vietnam, with an increase of 30.17 per cent to $65.25 million. This leapfrogged both countries in year-to-date importations of jeans over China. Cambodia also reported a big gain in that time, with its exports to the US skyrocketing to $29.15 million from 111.48 per cent. Pakistan, Egypt and Sri Lanka also reported small gains among the top suppliers in the region.
Pakistan Hosiery Manufacturers and Exporters Association (PHMEA) has sought zero-rated facility for the textile industry as this would help revive exports and earn much-needed foreign exchange. The government imposed a refundable 17 per cent sales tax on exports of these sectors in Budget 2019-20, which blocked their working capital and hindered growth in exports.
PHMEA demanded exclusive treatment through the de-merger of textile from the Ministry of Commerce, proposed levy of duty on export of cotton yarn (raw material for value-added textile), withdrawal of duty and taxes on purchase of locally produced raw material and zero sales tax on supply of power and gas.
It said the duration for receipt of export payments from international buyers should be increased to 365 days compared to existing 180 days as they were facing difficulties in receiving the payments under the global lockdown. The PTI government merged the Ministry of Textile with the Ministry of Commerce last year. The hosiery association requested the government to de-merge textile and make it a standalone ministry keeping in view the importance of textile industry.
All Pakistan Textile Mills Association (APTMA) says textile manufacturers in Pakistan have received new orders from different countries after the world slowly softened lockdown imposed to contain the pandemic.
These orders are a mix of new and ones which were put on hold and got temporarily suspended after the world imposed lockdown to contain the virus. Many global buyers, who had previously placed orders on hold, have now opted to take delivery. The receipt of new export orders, much earlier than expectation may, help in booking lower export losses than the initially estimated following the outbreak of COVID-19. Pakistan’s textile industries had received additional export orders and were running over installed capacity following the outbreak of the virus in China in end of December 2019.
Around 30 per cent textile industries, including value-added ones like readymade garments – have resumed production in Pakistan after the government allowed export industries to return to work under the strategy to crate balance while dealing with economic and health crises. It is, however, difficult to estimate the value of new export orders and those for which world buyers have started taking deliveries. As Pakistan was not impacted much by the Coronavirus outbreak, these orders may help Pakistan return to work earlier than estimated timelines.
Indonesian Filament and Fiber Producers Association(APSyFI) and the Indonesian Textile Association (API) have requested the government to relax tax policies as COVID-19 may force around 70 per cent of textile and textile product (TPT) companies to shut shop. At the moment, 80 per cent textile companies have halted operations temporarily while facing cash flow issues, so financial support from the government is urgently required.
One request includes penalty fee waivers from state electricity firm PLN and state gas company PT PGN for textile companies with electricity and gas consumption below the minimum threshold. The association warned that massive business closures could cause a spike in unemployment, as around 1.8 million TPT industry workers are already furloughed or laid off because of the pandemic. According to the Industry Ministry’s latest estimate, TPT industry employs around 135,000 workers annually, making up 22.5 percent of the total 600,000 workers in the industrial sector.
The association also complained about the financial sector not providing credit relaxations to textile companies, even though the Financial Services Authority (OJK) has issued regulation No.11/2020 on credit restructuring for companies impacted by the pandemic. There could be a spike in nonperforming loans from the TPT industry if the situation continues.
Cotton Association of India (CAI) has written to Prime Minister Narendra Modi to reduce the duty drawback of 5-8 per cent for export of cotton and cotton yarn. This will not only boost exports but also stabilize the cotton market and the benefit will go to India’s cotton-growing farmers and entire trade will get work. The government will earn foreign exchange if the export of cotton and cotton fiber picks up.
CAI expects to export 42 lakh cotton bales up to September 2020. So far, the association has shipped around 32 lakh bales which leave another 10 lakh bales to be shipped in the next five months from May to September. The association can easily achieve these targets if prices remain at this level.
CAI views that imports are currently not feasible because Indian prices are currently the lowest in the world while the prices across the world market at Rs 33,000-36,000 per candy. CAI had estimated import targets at 25 lakh bales of which only 12 lakh bales has happened so far.
As per latest data released by the government of India, export of formal jackets saw negative growth of 4.02 per cent in 2019 over previous year. The export of the commodity totaled to $ 241.33 million last year.
Under this commodity, jackets and blazers made of other textile material is the major exported product. The export value of this product totaled to $ 97.30 million with a growth of 9.09 per cent in 2019 over the previous year. Cotton jacket and blazer exports is second most exported item with a value of $ 57.86 million, but the product perceived a negative growth of 3.28 per cent in 2019 over the previous year.
Export of causal jackets perceived a negative growth of 5.25 per cent in 2019 over the previous year. Under this commodity, jackets made of cotton is the most popular and exported product. The product’s exports totaled to $49.87 million with a growth of 9.80 per cent in 2019 over previous year. Exports of jackets made of synthetic fiber declined by 6.09 per cent to $35.95 million.
Sport jackets registered an export of $25.1 million with a growth of 21.08 per cent in 2019 over the previous year. Under this commodity, exports of life jackets and lifebelts grew by 12.36 per cent in 2019 to $16.55 million.
Although Hugo Boss has begun reopening stores in Germany and Austria, the brand is recording low shopping turnout and expects its second quarter sales to fall by at least 50 per cent. Online sales in the first quarter accounted for 11 per cent of total sales and accelerated again strongly in April, with sales more than doubling on its own site and via partner websites and demand particularly strong for sportswear. The brand reopened stores in China in March-end. However, sales in April declined by 20 per cent over its previous year.
The brand’s first quarter sales were recorded to be €555 million ($605 million), while it posted a loss before interest and taxation of €14 million, which was worse than the average forecast of €6 million.
The company, which had already announced moves to protect its cash balance such as suspending store renovations and new openings and limiting the inflow of stock, has no plans to seek state aid. Instead, it aims to cut inventory inflow at least €200 million compared to its original plan, including cutting its own production.
A Care Ratings report suggests, revenues of the Indian cotton yarn industry are likely to decline and margins will remain moderate due to weak demand and shutting down of manufacturing units. Smaller companies with high debt levels, limited access to bank funding and limited liquidity buffer are expected to be impacted the most compared with their larger counterparts.
The Indian cotton spinning industry, which was already facing multiple headwinds such as low demand, unfavorable duty structure and fluctuating cotton fiber prices, is now confronted with yet another challenge in the form of COVID-19 pandemic. Facing lean demand since 2014-15, with intermittent spells of good periods, the Indian cotton yarn industry was expecting a change of fortune in 2019-20.
The estimate of bumper crops in the cotton season of 2019-20 was expected to bring respite to the sector.
The benefit, which was anticipated to come from lower fiber prices, is now expected to be more than offset by the fresh set of challenges brought in by COVID-19 outbreak.
At the Kingpins24 online event, Artistic Milliners and US Denim featured innovative denim fabrics that are sustainable, comfortable and antimicrobial. Artistic Milliners presented its Bio Vision 2.0 collection that is based on guidelines set by the Ellen MacArthur Foundation’s Jeans Redesign, featuring biodegradable fibers that provide optimal recovery. The mill’s circular focus is also displayed in its Circular Blue New collection, which is made of 100 per cent recycled cotton and uses post-consumer, pre-consumer and industrial waste.
US Denim’s latest collections also focus on sustainability and feature recycled and biodegradable fibers. Its Reborn product is “sustainable from every angle” and uses recycled cotton, elastane and polyester; aniline-free dyestuff; and water-safe dyeing methods.
The Pakistan-based fabric mill also highlighted its use of cottonized hemp, which checks off multiple boxes for consumers, as the fiber is both sustainable and naturally antimicrobial. Its IntelliJeans collection features hemp sourced from China that is free of pesticides and uses 86 per cent less water than conventional products.
Artistic Milliners offers a similar take on antimicrobial denim with its hemp-based Buttery Soft 2.0 collection. Made with water-saving dyeing techniques, denim in this collection provides the comfort of sweatpants with the look of an authentic jean. And while most jeans lose their softness over time, this denim was specially designed to get softer with every wash.
