Centre for Trade Facilitation and Research in Textiles

Centre for Trade Facilitation and Research in Textiles Textile Economic Intelligence (WEEK ENDING 22-12-2017) NEWS HIGHLIGHTS BANGLADESH TEXTILES & APPAREL EXPORT INCREASED BY 8% IN JUL- NOV 2017 Mauritius approves minimum monthly wage of $257 from 2018 Bangladesh to revive 13 textiles mills under PPP mode World cotton consumption to expand 4% in 2017-18: USDA VN textile and garment sector to benefit with signing of EVFTA next year MMF production grew by 5% annually in 10 yrs: CIRFS H&M sales increases 4% in 2017 New scheme for capacity building in Indian textiles sector Welspun first global textile entity to patent fibre tracking technology Indian firm Raymond commissions linen unit in Amravati Production of cotton yarn up 4.2% in October 2017 Apparel exports from India decrease 10% in November 2017 Polyster filament yarn production down 5.4% in October 2017

GLOBAL ECONOMIC NEWS a) Euro appreciated against Dollar by 0.47% from 0.847 per dollar on 18th Dec 17 to 0.843 per dollar on 22nd Dec 17 and Japanese Yen depreciated against dollar by 0.85% from 112.41 per dollar on 18th Dec 17 to 113.37 per dollar on 22nd Dec 17. b) Brent Crude oil price index increased by 2.57% from 18th Dec 17 to 22nd Dec 17. It increased from $63.41 per barrel on 18th Dec 17 to $65.04 per barrel on 22nd Dec 17. c) Cot Look A Index increased by 2.25% from 86.65 cents/pound on 18th Dec 17 to 88.6 cents/pound on 22nd Dec 17. d) The US stock market indicator Dow Jones came down by 0.15% from 24792.2 on 18th Dec 17 to 24754.06 on 22nd Dec 17. In Asian market, NIKKEI (Japanese market) went up by 0.004% from 22901.77 on 18th Dec 17 to 22902.76 on 22nd Dec 17. SSE Composite went up by 0.90% from 3267.92 on 18th Dec 17 to 3297.36 on 22nd Dec 17 and Hang sang went up by 1.82% from 29050.41 on 18th Dec 17 to 29578.01 on 22nd Dec 17.

INDIAN ECONOMIC NEWS EXCHANGE RATE: The Rupee appreciated by 0.09% from Rs 64.10/$ on 18th Dec 17 to Rs. 64.04/$ on 22nd Dec 17 strengthening by Rs. 0.06 FINANCIAL MARKET TRENDS: The Sensex went up by 338.62 points or 1.01% from 33601.68 on 18th Dec 17 to 33940.3 on 22nd Dec 17. The Nifty went up by 104.25 points or 1% from 10388.75 on 18th Dec 17 to 10493 on 22nd Dec 17. CHANGE IN FOREIGN EXCHANGE RESERVES: India s Foreign exchange reserves increased by $0.488 bn. to reach $401.385 bn. on 15th Dec 17 from $400.897 bn. on 8th Dec 17. Rise in Spun Yarn Production of India by 0.6% in July-Oct 2017-18: Spun Yarn Production (SSI & Non-SSI) (in Mn. Kgs. ) 2017-18 Cotton Blended 100% N.C. Total July 17 341.83 87.85 44.91 474.59 Aug 17 330.68 97.92 46.8 475.4 Sept 17 325.29 91.28 47.09 463.66 Oct 17 324.6 91.9 46.4 462.88 July-Oct (2017-18) 1322.4 368.9 185.2 1876.5 July-Oct (2016-17) 1315.0 351.6 199.0 1865.6 % Change(2016-17 to 2017-18) 0.6 4.9-6.9 0.6 The Spun yarn production of India increased by 0.6% to 1876.5 million Kgs in July-Oct 2017 as compared to corresponding months last year when it stood at 1865.6 million Kgs. Percentage increase in the production of Blended Yarn was highest at 4.9% which increased from 351.6 million kg in July-Oct 2016 to 368.9 this year.

Sectoral Index of Industrial Production: The Indices of Industrial Production for the Mining, Manufacturing and General sectors for the month of Oct 2017 stand at 101.2, 124.3 and 123.0 respectively, with the corresponding growth rates of 0.2 per cent, 2.5 per cent and 2.2 per cent as compared to Oct 2016 when it was 1 per cent, 4.8 per cent and 4.2 per cent respectively. The cumulative growth in these three sectors during April-Oct 2017-18 over the corresponding period of 2016-17 has been 3.4 per cent, 2.1 per cent and 2.5 per cent respectively. The growth rate for Textiles and Clothing for the month of Oct 2017 is -2.0 per cent and -11 per cent respectively. The cumulative growth during April-Oct 2017-18 over the corresponding period of 2016-17 was -2.3 per cent and -6.3 per cent.

HS Code GLOBAL TEXTILE NEWS BANGLADESH TEXTILES & APPAREL EXPORT INCREASED BY 8% IN JUL-NOV 2017: The total Textiles & Apparels Exports of Bangladesh to World for the month of November 2017 increased to $2733.4 Mn from $2493.07 Mn in the corresponding month last year registering a positive growth rate of 9%. The cumulative Exports of Bangladesh from July 2017 to Nov 2017 increased from $11926.9 Mn to $12885.9 Mn registering a positive growth of 8%. The highest share in Bangladesh Exports remained of Woven fabric which stood at $1265 Mn. The Second highest share was of Knitted fabric which was exported for the value of $ 1256.5 Mn. Bangladesh Textiles & Apparels Exports to World (USD Mn) Description Nov 2017 Cumulative Exports (July 2017- Nov 2017) Cumulative Exports (July 2016- Nov 2016) % Change 52 Cotton 14.6 56 43 30.8 Other vegetable textile fibres; paper yarn and woven fabrics of 53 paper yarn 88.9 396 327 21.1 54 Man-made filaments 4.8 18 14 24.8 55 Man-made staple fibres 3.0 10 9 16.2 Wadding, felt and non-wovens; special yarns; twine, cordage, ropes 56 & cables 2.4 11 18-36.3 57 Carpets and other textile floor coverings 1.6 7 7 5.2 58 Special woven fabrics; lace and tapestries 5.2 20 19 7.1 Impregnated, coated, covered or laminated textile fabrics; industrial 59 use 1.7 6 7-4.3 60 Knitted or crocheted fabrics 2.7 13 15-15.1 61 Knit 1256.5 6244 5633 10.9 62 Woven 1265.0 5718 5499 4.0 63 Made ups 87.3 386 338 14.3 GRAND TOTAL 2733.4 12885.9 11926.9 8.0 Mauritius approves minimum monthly wage of $257 from 2018 Mauritius recently approved a new minimum wage package of 9,000 Mauritian rupees per month ($257) from next year. Years of campaigning by trade unions in Mauritius led to this decision that will benefit around 120,000 workers in the country. Trade unions see this benefiting textile workers, many of whom were earning an average monthly salary of only $114. The new monthly minimum wage announced in parliament is Rs 8,140, but various compensation payments means that all workers will take home Rs 9,000, according to a press release from Geneva-based Industrial Global Union. Ninety per cent of workers in the Mauritian textile and garment industry are women; conditions are tough and many need to stand all day while they work.

However, the figure is still below what trade unions judge to be a living wage, calculated at around RS 14,500 (US$414) in 2014. Trade unions have been pushing for the new minimum wage during tripartite negotiations with the government and employers in Mauritius. Bangladesh to revive 13 textiles mills under PPP mode Bangladesh will restart 13 textiles mills, shut down 25 years ago due to losses, and run them under a public-private partnership (PPP) initiative. The cabinet committee on economic affairs has approved a proposal from the Bangladesh Textile Mills Corporation (BTMC) in this regard. The private party will implement, maintain and market products of the project. BDT 15,200 crore will be allocated to purchase new machinery to replace the existing ones and run these mills as part of the textile sector s largest project till now, according to Bangladesh media reports. According to the proposal, the 30-year-tenure PPP, in which the Bangladesh Jute Mills Corporation will be the major partner, can be renewed. The project will also ensure proper use of 380.47 acres of land allocated for the sector. The 13 mills up for overhaul are RR Textile Mill, Amin Jute and Textile Mills and The Asiatic Cotton Mill in Chittagong; Rangamati Textile Mill at Ghagra, Rangamati; Magura Textile Mill in Magura; Bengal Textile Mill at Noapara, Jessore; Rajshahi Textile Mill at Sapura, Rajshahi; Sundarban Textile Mill in Satkhira; Dinajpur Textile Mill and Jalil Textile Mill in Dinajpur; Darwani Textile Mill in Nipharmari; Dost Textile Mill at Ranirhat, Feni; and Afsar Cotton Mill at Savar, Dhaka. Of the 86 state-owned textile mills, BTMC handed over 60 mills to the Privatisation Commission between 1977 and 2013, and runs 24 factories across the country at present. The jute mills have been incurring losses for several years now. Their losses amounted to BDT 588 crore in fiscal 2015-16 World cotton consumption to expand 4% in 2017-18: USDA Global cotton consumption in 2017-18 is projected to increase 4 per cent to 119.6 million bales, according to the US department of agriculture (USDA). This will be the largest year-toyear growth rate since 2009-10 when mill use rose over 8 per cent. Cotton mill use is expected to rise in China, India, Pakistan, Vietnam, Bangladesh and Turkey. Mill use in China, the leading spinner of raw cotton, is estimated to reach 39 million bales in 2017-18, four per cent above the preceding year and the highest since 2010-11. China is the largest supplier of textile and apparel products to the world, and it is expected to benefit from the expanding global economy this season. Increased mill use of cotton is also forecast in India, Pakistan and Vietnam, due in part to their continued yarn shipments to China. India s cotton mill use is projected at 24.75 million bales, up 3 per cent from 2016-17 but similar to 2015-16. Pakistan is expected to spin 10.4 million bales of cotton in 2017-18, up slightly from a year ago and the highest in 3 years. Meanwhile, Vietnam continues to experience significant growth in its cotton consumption. In 2017-18, mill use in Vietnam is projected to reach a record 6.1 million bales, 13 per cent above the previous season, the report said. In addition, cotton mill use is expected to increase in Bangladesh and Turkey, where gains of approximately 7.5 per cent are expected in 2017-18. VN textile and garment sector to benefit with signing of EVFTA next year The EU-Vietnam Free Trade Agreement (EVFTA) expected to be signed next year which will provide tariff preferences to Vietnamese exporters to the EU. There will also be ample opportunities to upgrade the value chain for the textile and garment sector. Only EVFTA

originating products will benefit from preferential tariffs for a maximum of seven years after entry into force. To be EVFTA originating, EVFTA requires textile and garment producers to carry out two production stages in an EVFTA country: Vietnamese producers can upgrade their value chain, adding the weaving or knitting stage to the existing cutting and sewing. At present, this operation is particularly challenging, as it requires financial resources and high-skilled workers to manage the high-technology machinery. MMF production grew by 5% annually in 10 yrs: CIRFS Man-made fibres (MMF) production grew by around 5 per cent annually in the last ten years while those of cotton and wool fell by 1.6 per cent and 1.2 per cent respectively, according to the 53rd edition of Information on Man-made Fibres published by the European Man-made Fibres Association (CIRFS). The report analyses worldwide production, trade and consumption. Europe is the world s largest exporter of acrylic and cellulosic fibres and the biggest producer of ultra-high strength fibres and of polypropylene fibres. It is one of the global leaders in manmade fibres innovation and quality and its output is used in fashion, home textiles and various technical uses, the report said. The European man-made fibres industry is the largest supplier of raw materials to the European textile industry. The report shows continued and solid growth of the world s MMF industry while cotton and wool shares stagnate, said Houte. In 2016, MMF constituted 75 per cent of all textile fibres produced worldwide, this percentage going up to 81 in Europe. H&M sales increases 4% in 2017 The H&M group s sales including VAT increased by 4 per cent to SEK 231,744 million (222,865) in the financial year 2017 that ended November 30. Sales excluding VAT amounted to SEK 199,987 million (192,267). In local currencies, sales went up 3 per cent. The group continued to grow during the year, however, sales development in Q4 was low below expectations. In the fourth quarter of 2017, sales including VAT amounted to SEK 58,454 million (61,098). Sales excluding VAT amounted to SEK 50,390 million (52,720), a decrease of 4 per cent compared to the corresponding quarter last year. In local currencies, sales decreased by 2 per cent. The H&M brand s online sales and sales of the group s other brands continued to develop well. Meanwhile, the fourth quarter was weak for the H&M brand s physical stores, which were negatively affected by a continued challenging market situation with reduced footfall to stores due to the ongoing shift in the industry.

INDIAN TEXTILE NEWS New scheme for capacity building in Indian textiles sector India s Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi has given its nod for a new skill development scheme covering the entire value chain of the textile sector excluding spinning and weaving in organised sector. The Scheme for Capacity Building in Textile Sector (SCBTS) will have an outlay of Rs 1,300 crore till 2019-20. The objectives of the scheme are to provide demand driven, placement oriented skilling programme to incentivise the efforts of the industry in creating jobs in the organised textile and related sectors; to promote skilling and skill upgradation in the traditional sectors through respective sectoral divisions/organisations of ministry of textiles; and to provide livelihood to all sections of the society across the country. The skilling programmes would be implemented through textile industry/units in order to meet the in-house requirement of manpower; reputed training institutions relevant to textile sector having placement tie-ups with textile industry/units; and institutions of ministry of textiles/state governments having placement tie-ups with textile industry/units. The scheme will be implemented for the benefit of all sections of the society across the country including rural, remote, LWE affected, North East, and J&K by imparting skills in the identified job roles. Preference will be given to various social groups, SC, ST, differently abled, minorities and other vulnerable groups. Under previous scheme of skill development implemented by the ministry of textiles in the 12 th fiveyear plan period, more than 10 lakh people were trained of which more than 70 per cent were women. Considering that the apparel industry, a major segment to be covered under the scheme, employs majorly women (about 70 per cent), the trend is likely to be continued in the new scheme. Around 10 lakh people are expected to be skilled and certified in various segments of textile sector through the scheme, out of which 1 lakh will be in traditional sectors. Welspun first global textile entity to patent fibre tracking technology Welspun India, Mumbai-based world's second largest terry towel producer developed the technology to verify the origin of cotton, after a large customer terminated a contract following mislabelling of provenance of fibre in certain consignments. It has emerged as the first global textile entity to patent a fibre-tracking technology, turning adversity into opportunity. Welspun has partnered with global forensic science company Oritain Global to develop the solution, Wel-Trak, using RFID and customised software. It involved an investment of around $6 million (38.5 crore) and more than six months of rigorous efforts. The technology enables it verify the origin of cotton at each stage of the manufacturing process to ensure an authentic final product. Apart from deploying this solution in several cotton growing areas across the globe, Welspun India is now looking at helping cotton farmers grow better quality cotton and also encourage them try organic cotton. Being India's largest consumer of cotton, Welspun is currently working with farmers at various cotton growing locations across the country to help them adopt better quality cotton crops. The company is guiding and mentoring the farmers on right practices, right seed and right pesticides. Indian firm Raymond commissions linen unit in Amravati Indian textile company Raymond Ltd recently commissioned the first phase of its greenfield project in the cotton-growing district of Amravati in Maharashtra. However, only linen, a highend fabric made from flax, a crop grown in France and Belgium, will be manufactured in the first phase. Commercial operations at the unit will begin by April next year. Plans for the second phase, which may use locally grown cotton, would be announced in due course.

This would be Raymond's third unit in central India and the second in the Vidarbha region. The company has a denim plant at Yavatmal and a woollen fabric unit in Chhindwara district, on the Madhya Pradesh-Maharashtra border. Production of cotton yarn up 4.2% in October 2017 After having decreased for five consecutive months ended September 2017, cotton yarn production grew by 4.2 per cent on a y-o-y basis in October 2017. Output stood at 324.2 thousand tonnes during the month. On a sequential basis, production was down by 0.2 per cent. During April-October 2017, cumulative cotton yarn production fell by 1.1 per cent. Output stood at 2,335.7 thousand tonnes as against 2,362.5 thousand tonnes during the same period a year ago. Month Production 000 tonnes % change Jun 2017 336.8-4.31 Jul 2017 341.5-0.53 Aug 2017 332.4-0.62 Sep 2017 324.8-0.54 Oct 2017 324.2 4.20 Apparel exports from India decrease 10% in November 2017 India s apparel exports fell for a second consecutive month in November 2017. The country exported apparels worth USD 1 billion during the month. This translates into a decrease of 10 per cent on a y-o-y basis. Sequentially, however, garment exports grew by 24.8 per cent. On a cumulative basis, India s total apparel exports grew by 0.7 per cent during April-November 2017. Apparels worth USD 11 billion were exported during the period. Month Export value USD million Y-o-Y % change M-o-M % change Jul 2017 1,281.1-12.00-17.27 Aug 2017 1,337.5 0.55 4.40 Sep 2017 1,661.6 29.39 24.23 Oct 2017 829.8-39.20-50.06 Nov 2017 1,036.0-9.98 24.84

Polyster filament yarn production down 5.4% in October 2017 Production of polyester staple fibre (PSF) and polyester filament yarn (PFY) fell by 11.5 per cent y-o-y to 70,400 tonnes and 5.4 per cent y-o-y to 88,010 tonnes, respectively, in October 2017. Output of viscose filament yarn (VFY) grew by 2.7 per cent to 4,000 tonnes and that of viscose staple fibre (VSF) increased by 1.2 per cent to 32,860 tonnes during the month. Production of acrylic fibre (AF) surged by 31 per cent to 8,840 tonnes in October 2017. Nylon filament yarn (NFY) production was down by 10.5 per cent to 3,300 tonnes during the month. Product Oct 2016 Oct 2017 Y-o-Y % change PSF 79,512 70,400-11.46 PFY 93,003 88,010-5.37 VSF 32,456 32,860 1.24 VFY 3,894 4,000 2.72 AF 6,747 8,840 31.02 NFY 3,688 3,300-10.52