By Frank Collins,2014-10-23 20:06
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     C ott o n Textile : Br isk again st Blea k

     By Dennis K. Zhao

     The 6th International cotton and cotton textile conference already scheduled on Sept.8-10 in Xinjiang, Chinas largest cotton growing area, was called off on a short notice of rascal needle

     dabbing that had caused a widespread public consternation. But

     the information that is focused on the leitmotif of financial crisis

     and revitalization of textile industry for adjustment, upgrading and

     innovation” is to be shared, discussed at the upcoming resumed meeting. Cotton textile industry is and will be the most important

     driver for the global textile and clothing sector as it provides jobs not only for the residents living in the cities, but also for the farmers

     growing cotton in the poverty-ridden countryside. China and India

     are the most important players in this sector, for both are the most populous countries in the world…

    Global TrendsTrade in Textiles & Clothing World

    $, 100 billion) (unit: US T h e w o r l d t r a d e o f t e x t i l e a n d c l o t h i n g w a s

    experiencing a fast-growing period since the new

     Millennium. During the first 8 years, the world trade in

     this sector is expected to grow from US$356 billion in 2000 to reach a level of US$598 billion 2008, recording

     a growth of 6.7%. In 2008, textile and clothing trade

     s l o w e d d o w n t o 2 . 5 % a s c o m p a r e d t o a h e a l t h y growth of 10% in 2007. Global import scenario has

     worsened during 2009. Assuming a conservative WTO Estimated * Source:

    October 2009 China Textile 22

growth rate of 5.6%, world trade in

textile and clothing is expected to

reach a level of US$ 700 billion by

1012. Textile and clothing growth of 7.8% during post-quota period is higher than the pre-quota growth o f 6 . 2 % , i n d i c a t i n g a d v a n t a g e s o f l i b e r a l i z e d t r a d e . I n t h e p o s t - quota era, clothing has recorded a higher growth of 9.7% than textiles which recorded a growth of 5.0%, i n d i c a t i n g t h a t t h e g l o b a l t e x t i l e trade is shifting in favor of value added textile goods and structural adjustments are taking place world economies. Global Trade & Major Markets in Cotton Textiles Global trade in cotton textiles is expected to record a growth of 4.19% in 2008, which is above the export growth of textiles of all fibres (3.7%), showing a higher demand

Growth in World Textile and Clothing Trade for cotton-based textile products.

Unlike cotton yarn (negative growth Textiles 5.2% 5.6% 5.0% of -4.67%), exports of cotton fabrics Clothing 7.8% 6.7% 9.7% a n d c o t t o n m a d e u p s r e c o r d e d Textiles & Clothing 6.7% 6.2% 7.8% g r o w t h s o f 3 . 5 2 % a n d 8 . 3 5 % Source: WTO respectively during 2008. Higher

g r o w t h i n e x p o r t s o f m a d e u p s

as compared to fabrics and yarn World Trade in Cotton Textiles (Value: US$ billion)

Total cotton total cotton total cotton total cotton total cotton 34.31 9.91 37.56 10.7 35.49 10.2 9.47% 7.97% -5.51% -4.67% 109.97 49.1 123.81 55.43 128.55 57.38 12.59% 12.89% 3.83% 3.52% 58.61 28.1 65.59 31.86 71.31 34.52 11.91% 13.38% 8.72% 8.35% 202.89 87.11 226.96 97.99 235.35 102.1 11.86% 12.49% 3.7% 4.19% Source: WTO

October 2009 China Textile 23

     nfocus I indicates that the global textile trade continues Major Global Markets for Cotton Textiles

     t o s h i f t i n f a v o r o f

     v a l u e - a d d e d t e x t i l e 1 United States 11115.5 11437.7 11122.7 2.9%-2.8% goods. -12.9% 2 Hong Kong 8263.3 7946.2 6921.7 -3.8% United States, the 3 China 7061.1 7145.2 6839.5 1.2% -4.3%

    4 Germany 4479.7 5139.5 5123.4 14.7% -0.3% single largest market 5 France 3183.8 3440.3 3455.8 8.1% 0.4% f o r c o t t o n t e x t i l e s 6 Italy 3187.1 3427.9 3407.8 7.6% -0.6% worldwide, witnessed 7 Japan 2906.9 2873.2 3210.2 -1.2% 11.7%

    2622.4 2432.7 8 UK 2403.3 9.1% -7.2% a negative growth of 9 Mexico 2574.7 2292.9 2181.3 -10.9% -4.9% - 2 . 8 % d u r i n g 2 0 0 8 . 10 Poland 1693.7 1941.3 2033.7 14.6% 4.8% I n H o n g K o n g , t h e Source: GTIS, Geneva d e m a n d f o r c o t t o n textiles recorded a substantial decline of -12.9% last year on account of slowdown in its exports

     of value-added textile goods. Other major markets, such as Germany, France and Italy in the EU showed stagnation in the imports of cotton textile items. Japan, on the other hand, showed an excellent growth of 11.7% on account of over 19% appreciation of Japanese Yen in 2008. Major Textile Players India Indias position the world textile economy is very prominent as it is the second largest

     producer of raw cotton, cellulosic fibre/yarn, cotton yarn, silk and jute. Cotton is an important commercial crop in the country, providing raw material to over 1500 mills. India accounts for 29% of world cotton area and 21% of world production having yield average of 549 kg lint per ha. The cotton production is expected to increase from 4.93 million tons in 2008-0 9 to 5.52 million tons in 2009-2010. Textile industry in India contributes to 4% of GDP, 14% of the total industrial product, 20% of the total work force and 17% share of countrys export basket.

India' sVision: Indian Textile Industry: Future Outlook

    642 995 based on 5% secular growth 479

     4% 8% 9% estimated to reach 9% by 2020

     20 55 90

     30 60 85 annual growth rate 8%

     50 115 175

    2 11 18 estimated to grow 10% of total textile economy

     48 104 157 40 109

    12 27

    Source: TEXPROCIL

    October 2009 China Textile 24

Ring spinning capacity, yarn and fabric production ( 2000 2008 )

     3443 3548 4906 5942 6700 7846 8900 9900 10443 660 760 850 983 1291 1440 1740 2068 2149 277 290 322 353.5 420 470 550 675 710

    (Value: US$ million)Imports of Raw Cotton by China World 3536.8 3528.2 -0.24% 100.00 2069.2 945.78 -54.3%

     1 USA 1609.8 1662.8 3.29% 47.13 697.58 526.21 -24.6% 2 India 869.9 962.5 10.64% 27.28 858.92 98.894 -88.5% 3 Uzbekistan 298.4 275.3 -7.74% 7.80 175.47 124.55 -29.0% 4 Australia 171.7 134.0 -21.96% 3.80 46.467 45.013 -3.1% 5 Benin 80.9 82.3 1.73% 2.33 54.182 21.289 -60.7% Source: GTIS

    (Value: US$ billion) Cotton Textile Trade In China Raw cotton 3.53 34.0% 0.04 0.1% -3.49 Cotton yarn 1.86 17.9% 1.95 6.4% 0.09 Cotton fabrics 4.50 43.4% 17.58 57.7% 13.08 Cotton madeups 0.48 4.6% 10.89 35.7% 10.41 Total 10.37 100.0% 30.46 100.0% 20.09 Source: GTIS

    India has spinning capacity of 37.5 million spindles, and weaving capacity Chinas net exports of cotton of 1.93 million looms, excluding hand looms. The future outlook of Indian textiles were valued at US$ 20.09 textile industry is given by Mr. Shri V.S. Velayuthan, chairman of the Cotton b i l l i o n d u r i n g 2 0 0 8 . E x c e p t r a w Textiles Export Promotion Council of India, in his presentation expected to c o t t o n ( h a v i n g a s h a r e o f 3 4 % be addressed to the international cotton textile conference later this year: i n t o t a l c o t t o n t e x t i l e i m p o r t s ) ,

    China is net exporter of all product China

    categories. Besides exporting cotton The past eight years witnessed a tremendous growth of installation in

    f a b r i c s w o r t h U S $ 1 7 . 5 8 b i l l i o n , spinning capacity from 34.43 million in 2000 to 104.43 million spindles while

    China also imported cotton fabrics its yarn production curved up to 21.49 million tons in 2008 as against 6.6

    worth US$ 4.5 billion last year, and million tons in 2000.

    Chinacotton madeups export from Despite this amazingly speedy growth, the global economic crisis has

    are sizable at US$ 10.89 billion.also exerted a negative impact on its cotton textile sector. The first five months of this year saw a continued 2.55% drop in profit and job cutting of Xinjiang, Cotton & Cotton 65,000 workers as compared with the same period of last year, and cotton Textile Base in China

    According to an industrial survey, textile goods export was still deteriorating. Even though, China is still the

    t h e r e w e r e 1 1 5 c o t t o n t e x t i l e largest cotton consumer in the world. United States is the largest supplier

    companies in Xinjiang, with ring of raw cotton into China, accounting for a share of 47.13%. As cotton

    spinning capacity for 3.6 million production was declining in US, China will have to source its requirements

    s p i n d l e s i n 2 0 0 8 , 1 4 t i m e s a s from other suppliers. India is the largest supplier of raw cotton accounting

    much as that of 238,500 spindles for a share of 27.28%.

    October 2009 China Textile 25

     nfocus I

    in 1978 when the Chinese government decided to adopt opening and reform policy 30 years ago.

     This fast growing spinning capacity puts Xinjiang onto the first place in cotton textile production in the 12 provinces in the West of China. Besides, there are 88,000 rotors and 7607 looms, and annual capacity of 600,000 tons in lint pulp production and 280,000 tons of viscose fibre production, and these two sectors (cotton textile and rayon) account for 90% of the total textile industry output value in the region.

    Production relocation from coastal areas to Xinjiang has been driven by factors of production, but mainly by the attractive local policies. In 2008, the new investment from big companies in Zhejiang, Jiangsu and Shandong provinces reached 2300 million yuan, representing 60% of the total equity

    investment in Xinjiangs textile industry. Of the investors,

    some are very famous companies, such as Esquel Group,

    Youngor Group, Xiongfeng Group, Luthai Textile, Zhejiang

    Giant Eagle, Huafu Holding etc. Last year, two million

    spindles were added in a wide-spread restructuring and

    revitalizing move featured with inviting new textile projects

    o r g a n i z e d b y t h o s e l a r g e d o m e s t i c a n d i n t e r n a t i o n a l


    More significantly, five industrial bases have been

    formed, namely, Changji in Urumqi, Kuytun in Shihezi city,

    Weili in Korla, Alar and Kashkar in Aksu where infrastructure

    and preferential policies are provided for investors in addition to the other local advantageslike labor cost and rich cotton production and supply. In 2008, the cotton production reached 3.01 million tons, accounting for one-third of the national totals while its long staple cotton represents 90% of the total production in quality long cotton.

Cotton Textile Industry: Things to Do

    Referring to the prospect for Chinese cotton textile industry, Mr. Xu Wenying, president of China Cotton Textile Association, was pleased to notice that the first five months of this sector had gained 3.26 percentage points higher to reach 335.87 billion yuan in industrial output value with the domestic sale representing 91.81%, a marvelous growth driven by domestic brisk market demand against bleak international market climate.

    To make a fundamental turn for the better, there are things to do in the coming years. Mr. Xu mentions that technology needs to be further improved to get rid of the old capacities. The stronger growth could only be realized by more contributions from application of science, technology and brand strategy to have more gains by virtue of innovation and creativity, which makes it possible to reduce energy and material consumption on environment-friendly streams.

    To make good use of productive factors in a rational and efficient way, industrial restructuring that includes production relocation to the midland and west of China seems to be more significant. Whether the market is brisk or bleak depends largely on the situation where you would remain idle to do nothing or you would stay firm in conviction of having a change. Have a brisk mind, and you will have a cotton-white sunny weather out of bleak climate of economic recession. There are 8 important tasks to be fulfilled in the restructuring and revitalizing program for national textile industry. There are things to do…

    October 2009 China Textile 26

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