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China , India and Pakistan fighting for US home textile market in quota-free period
China is expected expanding its share of US market for home textiles in the post-quota period after its shipments already rose 53% in the January-October period. While clearly dominated in polyester segments, India and Pakistan could play their cards in cotton categories, however, as indicated by our statistical report comparing US imports from China , India and Pakistan .  |
Hong Kong 's denim exports sharply increased in 2004
Hong Kong 's re-exports of denim fabrics sharply rebounded in 2004 not only due to stronger sales to China . Shipments to a series of low-cost countries surged in the second part of the year, reflecting higher demand for denim apparel in the US and the EU. Export prices continued increasing at the same time. |
Cotton prices again supported by state-intervention
Cotton prices are far from falling although they should decline below 40 cents per pound, according to market fundamentals. State intervention in China , India and Pakistan is supporting prices while cotton use is expected sharply rising as a result of lower cotton costs and higher textile consumption in the PRC. |
Egypt's apparel get duty-free access to the U.S.
Egyptian apparel exports will have a duty-free access to the United States provided they are produced in four Qualifying Industrial Zones (QIZs), under an agreement that will be signed in the coming week. Liberal rules of origin would allow the use of Asian fabrics. The agreement could weaken other low-cost exporters in Jordan and elsewhere. |
US Quota Alert : new embargoes in sight in the coming days
US trade officials are expected placing additional embargoes in the coming days, as fill rates are approaching 100% for a large number of products. After China and India , Pakistan and the Philippines are threatened by a temporary ban on various items, as indicated by our last monthly report on US quotas. |
Taiwan imports of cotton yarns boosted by lower prices
As a clear sign of a rebound in textile activity, Taiwan 's imports of cotton yarns sharply recovered in August and September, after cotton yarn prices began falling. Pakistani exporters of cotton yarns were clearly dominated by their Indian competitors on Taiwan 's market this year with Indonesia becoming a serious challenger, partly due to the fall in the rupiah. |
Cotton consumption could support prices
Lower cotton prices this season could result in much higher consumption, therefore supporting prices at the end. In the meantime state-run agencies in Pakistan , India and China will continue buying large quantities of the new crop to limit the decline in farmers' earnings. In the short term, textile mills could be forced rapidly buying cotton at current prices, especially in China where exports are expected surging in the post-quota period. |
EU will remove quotas on imports from Vietnam
The European Union will finally eliminate its quotas on textile and clothing imports from Vietnam although the Asian country did not yet join the WTO. US quotas will be maintained in the next year, in sharp contrast, and possibly extended to additional categories after a petition was recently filed by a coalition of US associations. US quotas could be finally removed by the end of 2005, however, after Vietnam will have been admitted at WTO. |
Pakistan 's bed linen confronted with US embargoes and EU's rising tariffs
Pakistani exporters of home textiles are facing very important uncertainties these days. Shipments to the United States are being blocked at US ports by a series of embargoes while EU tariffs in the coming year may range between 8.50% and 21.60% depending on a series of decisions by Brussels . The imminent removal in textile quotas is expected boosting Pakistan 's sales, nevertheless. |
Polyester prices resisting downward trend
Polyester prices were mixed in Asia in the past seven days. In India , Reliance left its December PSF price unchanged while lowering its POY price. In Pakistan , PSF prices were further raised from 1 December while they continued falling on China 's spot markets in the past seven days. Prices of polyester raw materials are resisting a new fall but paraxylene prices are clearly decreasing. |
Special treatment to textile sector demanded
The Towel Manufacturers Association (TMA) has demanded special treatment to the textile sector by the Sales Tax Department to enable it to face the competition from other countries. TMA Patron-in-chief S.M.A Rizvi, in a statement, has welcomed the changes made in the Sales Tax Department with regard to computerisation of records, better-qualified staff and meetings - not among themselves - but with the trade.
He said that behind those visible changes the main change was in culture, which preceded increase in efficiency, adding no one in the past at the top in the Central Board of Revenue (CBR) knew exactly how to actually bring about the cultural change. The dark ages in the CBR would have continued indefinitely, had it not been for the World Trade Organisation (WTO) and the end of quota regime, he opined, and added that the proverb "necessity is the mother of invention", had once again proved to true. Rizvi said it was a happy sign that the country was preparing to meet the challenges of the WTO regime in the Sales Tax Department and the efforts of the CBR Chairman and particularly, the member, Sales Tax, in bringing about a degree of professionalism in the Sales Tax Department deserved to be acknowledged. |
Comprehensive textile policy soon
The federal textile minister, Mushtaq Ali Cheema, said that homework had been completed and textile policy would be announced soon. He said that Pakistan Textile Industry is poised to face all the challenges in terms of quality in the wake of World Trade Organization (WTO). He pointed out that Pakistan had secured fourth position among cotton exporting countries and the government was working out policies to encourage growers.
The government has knowledge about the problems faced by the community related to textile industries, he said and added that Prime Minister Shaukat Aziz was keen to resolve their problems on priority basis. |
FPCCI plans to exhibit 'Made-In-Pakistan'
The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) is planning to stage exhibition of 'Made-in-Pakistan' in Brazil , Mexico and Argentine. Arshad Alam, Vice-president of FPCCI, on his return from abroad, pointed out that all the said three countries were big markets for Pakistan origin bed linens, carpets, surgical and sports goods. He added that Pakistan 's exports to Brazil , Mexico and Argentine would reach to $2 billion in next two years.
Arshad Alam said that out of textile exports, presently third parties were reaping most of the benefits by selling Pakistani products with their own labels. He stressed upon the traders to persist in using their own brands while exporting. He further revealed that the Export Promotion Bureau has set up a separate centre for promotion of Pakistani exports and 'Made-in-Pakistan' exhibitions would be held with the collaboration of this centre. |
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Chinese apparel exports to US via Pakistan
The Export Promotion Bureau vice-chairman Abid Javed Akbar stated recently that China has agreed to export fashion apparel to the US market through Pakistan , in order to avoid safeguard measures in the event of over-shipment during the quota-free regime. A formal agreement would be signed to this effect by Prime Minister Shaukat Aziz during his forthcoming visit to China . During his visit to China in July, the EPB vice-chairman initiated to expand the Preferential Trade Agreement (PTA) by including textile items. The PTA was signed with China last year.
Under the arrangements, Pakistan has offered China to export fashion apparel to the US market from Pakistan 's territory for manufacturing with its own technology and technical staff. A formal request was submitted to the Chinese government by the commerce secretary after finalization of arrangement deal. The offer was made in categories, which Pakistan had not been able to utilize to the maximum. Pakistan would get buyers' driven Foreign Driven Investment (FDI) in the deal. He said the committee has identified 11 items consisting of 893 product lines worth US$1.5 million for export to Sinking, a China province bordering Pakistan . The items includes apparel, cotton yarn, sea food, processed food, jewelry, electronic items, chemical, pharmaceuticals, confectionery, sports good etc. |
Expo Pak 2005 to cost Rs 150m
Preparations are in full swing for the largest exhibition of the country namely - Expo Pakistan 2005, which is supposed to receive participation fees and sponsorships to the tune of Rs 90 million, according to the Export Promotion Bureau (EPB). With the costs of staging the event anticipated at would be Rs150 million the EPB Chairman Tariq Ikram said the EPB will spend Rs60 million on the Expo 2005. Almost 60 percent stalls bookings have been done so far and he said that previously the event was scheduled for October but due to some reasons it was rescheduled for February. He differed on the subject of the Expo 2005 running concurrent with other major international exhibitions such as Heimtextil, Magic, Domotex, etc. He informed that for the promotion of Expo Pakistan 2005, the EPB has held road shows in China , France , UK , Germany , etc. He disclosed that a number of executives and decision makers of major corporations of these countries have agreed to come to Pakistan during the Expo. About 200 foreign delegates are expected to come to Pakistan out of which 25 to 30 visitors are expected from Japan , 20 from Germany , 40 from France and 35 from China , he added. Answering a question he said that the arrangements for airlifting of stranded cargo of textile quota exporters have been finalized and the associations and exports would be informed about the arrangements in shortly. He revealed that airlifting of cargo, which is estimated to be about 2,400 tonnes would be started from January 1 and would continue until January 20, 2005 . |
PAKSEA criticizes EPB for quota mess
The Pakistan Knitwear and Sweater Exporters Association (PAKSEA) has recently criticized Export Promotion Bureau (EPB) stating that the mismanagement of textile quotas by EPB over the years has finally taken its toll as exporters are likely to suffer a loss of $50 million ahead of quota-free regime beginning from January 1, 2005.
PAKSEA, chairman M Anis Marfani at a press conference convened to draw the attention of high-ups towards the quota crisis and monetary loss the exporters would suffer. He claimed that the Miscalculation or mismanagement in quotas by the EPB, deliberately or by mistake should not be allowed to damage country's exports and bring bad name as a large number of exporters having valid quotas in their Category Pass Books (CPB) have already entered into export contracts. The Textile Quota Management (TQM) of the EPB fearing embargo in US categories 347/ 8,360,361,666(S) and 666(P) about a fortnight back informed exporters that no further shipments shall be allowed and visa will be issued only for shipments made on or before November 13, 2004. The EPB decision created panic among valid quota-holders of these categories but are now being denied utilization of quota and meeting their export commitments. Similarly, the EPB said that in category 338 the fill rate is also above 91 per cent and hence, this category has also become very sensitive. The exporters were also advised to check availability of quota from their textile association concerned before making any further shipment.
Anis Marfani alleged that in 2004, knitwear exports to the US , quota quantities of two categories 347/348 (trousers) and 338 (T-shirts) have been calculated by the EPB in excess to the upper ceiling agreed by the US government. Therefore, the EPB has put on hold quota-holders from utilizing quota for knitwear items. He said that since the error has occurred due to oversight and negligence on the part of EPB, in calculating limits of quota ceiling, therefore, exporters should not be made scapegoat specially when they are entering quota free market in 30 days and face free competition from other nations.
The Paksea chief said the EPB has wrongly estimated growth or residual quotas and made auctions without ascertaining exact quota quantities. This has caused huge financial loss to the industry, which is the largest employer. He said that over 40 per cent of women are employed in this industry and if the government did not come to the rescue, many units may close down. Giving details of the losses, he said around 880,000 dozens of 338 category having average unit price of around $46 would result in total financial loss of $41 million and 120,000 dozens of category 347/348 with unit price of $66.50 would bring losses of $7.981 million to exporters. In order to save the situation and country's exporter, he suggested to the government that all exporters who have quotas available in their books should be asked to surrender them and the government should pay them at the highest price of 2003 growth auction rates.
He also demanded that all those exporters who have orders but cannot ship due to quota constraints if they ship goods by first week of January 2005, by air to maintain delivery at destination their airfreight must be paid by the government. Whereas those exporters, he said, who are unable to persuade their buyers to accept late delivery and their orders are on stake, EPB must issue visas and ministry of commerce must persuade US authorities to release these shipment as a special case. Marfani urged upon the government to hold EPB accountable and should punish those who are found responsible for creating such a mess. |
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