The recent fall in the US dollar may not depress US
apparel imports from a series of low-cost countries, as many
other currencies are following the same trend value. Compared
with Vietnam, Indonesia and Sri Lanka, China is losing some
competitive advantage as the yuan rises. By contrast, exports
from Turkey, Brazil and India are being weakened by stronger
increases in their currencies.
Cotton prices significantly increased in the past week in
New York, reflecting strong demand from funds and speculators.
Long-term fundamentals are indicating lower global production,
after wheat, corn and soybean prices surged in the past
months. On the short term, however, imminent harvest should
push some strong pressure on the cotton prices.
The polyester market was last week dominated by Sabic's
decision to offer a lower price than other glycol producers,
triggering a sharp decline on MEG spot markets in Asia. PTA
remained very weak, forcing producers in announcing a
reduction in operating rates. Although intermediate prices are
falling, polyester prices began more seriously recovering in
China.
Prices of polyester staple fibers further rose in the past
weeks in China while filament prices were mostly unchanged.
Demand for PSF may be depressed by the fall in domestic cotton
prices, however, while the current rebound in polyester lining
production may help filament yarn makers in increasing prices
after glycol again surged in the past week.
Although still very stable, nylon prices may slightly
increase in the near term in China, after raw material costs
again surged in Asia. Caprolactam prices are boosted by tight
supply as China and Taiwan continue importing large quantities
and new nylon polymerization plants are being commissioned. A
series of planned overhauls should further support CPL and
nylon prices in the near term.
Taiwan's exports of polyester filament fabrics were
stronger in the first part of the year, thanks to surging
sales to Vietnam and Brazil. Shipments to China were much
weaker this year, including a fall in exports to Hong Kong.
Exports to Europe could benefit from the recent rise in EU's
anti-dumping duties on fabrics from China.
There are strong reasons to worry in India after U.S.
apparel imports slightly fell in the first part of the year
from this country. The rise in the rupee and weakness of
man-made fiber categories resulted in lower U.S. orders. With
significant growth reported in categories where China is
limited by U.S. quotas, Indian exporters may face more
troubles after the end of next year.
Cotton prices fell in the last week over lower demand in
New York. India is expected harvesting a new record crop this
year, an official U.S. report confirmed while production may
also be larger than expected in China and Pakistan, further
depressing prices. Harvest pressure may also be felt in the
coming weeks, when large quantities from the new crop will
reach local markets in the Northern Hemisphere.
Glycol prices last week surged to unbearable levels for
polyester producers, at US$1,350 CIF China. Polyester
production may rapidly decline in Asia, as China is still
delaying its full return to the market, in addition. PTA
further weakened but could now resist thanks to the rise in
MEG prices. Glycol's ACP (Asian Contract Prices) for October
gained about US$300 in a single month.
U.S. apparel imports from Mexico strongly declined in the
first part of the year, once again. Mexican industry is,
however, resisting in trouser category 347 (men and boys) and
with dresses. Unit values are significantly higher in cotton
than in man-made fiber categories, as reflected by series of
price tables and price indexes, including comparison with
China.
Wool prices were more or less stable this week in
Australia while falling in South Africa and rising in New
Zealand. Australia is still waiting for an agreement with
Beijing which could solve the quota issue. President Hu Jintao
this week visited an Australian farm, having tea with a wool
grower.
The South Indian Mills Association (SIMA), headquartered
in Tamil Nadu, is setting up a textile park at Naidupet. The
state expects additional investment to the tune of Rs 45,000
crore in spinning in the next three years and targets exports
worth $5 billion in 2012.
U.S. imports from Sri Lanka did not move in the first half
this year. Still protected by U.S. quotas on Chinese products
and benefiting from a fall in the currency, exporters also
shifted to women's products, specializing in underwear,
brassieres and other lingerie. Such a move should help the
country in overcoming more Chinese competition if also getting
a tariff reduction at U.S. borders.
Wool prices significantly climbed in US$ terms this week
in Australia, reflecting very good demand despite the sharp
decrease in the American currency. The strength in the euro
stimulated demand from Europe which is expected continuing in
the next week with sales of excellent qualities at Newcastle.
Digital spinning machines, developed successfully by
Tianjing Industrial University, recently received the approval
of an experts' body. These simple-to-operate,
computer-controlled spinning machines are expected to produce
high quality yarns. The digital spinning machines have a
practical design and are reliable and advance in their
operation. Another unique feature of the new spinning machine
is that it can be connected to both cotton-spinning and
wool-spinning equipments.
Polyester prices continued decreasing in the past seven
days in China under a very low level in demand, as usual in
August. The decline was however limited by a surge in glycol
prices reaching extremely high levels. The price difference
with cotton is also favoring consumption of polyester and
should boost demand when China's textile will be back to full
work in the very short term.
