80% of towels sold in Zhejiang、 China fail quality inspection

CCTV's (Mainland China Central Television) "Weekly Quality Report" (broadcast on March 25, 2007) reported the following noteworthy facts.

Zhejiang Bureau of Quality and Technical Supervision and Quality Supervision & Inspection Center of National Textile Garment Products recently tested at random the quality of towels sold in supermarkets in Zhejiang, and 80% of them failed with problems found in water absorbing properties and fastness. These cheap towels are manufactured in Hebei, and distributed in markets in Zhejiang and Shijiazhuang in Hebei.

According to Quality Supervision & Inspection Center of National Textile Garment Products, benzidine and 4-diphenyl　which are strongly suspected to be carcinogenic were detected in failed towels.

A person involved in the towel committee of China's National Federation of Textile Industries said that coarse towels were dyed with cheap direct dyes prohibited under the "National general safety technical code for textile products." "Cotton 100%" was indicated on those towel products, although low-quality chemical fibers were blended in, resulting in poor permeability and water absorbing performance.

Yamatogawa Dyeing Works in Sakai dyeing with E-control goes well.

Yamatogawa Dyeing Works in Sakai has introduced Monforts' E-control machine using reactive dyes, and operated it smoothly. Characteristics of this machine are one-bath padding of reactive dyes and alkaline chemicals as well as fixing dyes under near steam heat conditions through the automatic control of the temperature and humidity inside the machine to aim at the elimination of additives like urea and for improvement in the fixation rate of dyes, realizing energy savings, resource savings and waste reduction.

A preliminary understanding of maximum rates for exhaustion and initial-fixation rates which differ slightly from dye to dye is necessary. There are many dyeing firms in Japan producing unique colors through unique uses of dyes. Yamatogawa Dyeing Works is no exception. The company has mastered the E-control machine with its unique composition of dye items.

Toray expands sewn apparel business targeting 200 billion yen/80 million pieces in fiscal 2010

Toray will unify management of the group's domestic and international sewn apparel businesses, aiming for a group-wide expansion of its sewn apparel business. It is aiming to boost the group-wide scale of operation of sewn apparel business from 130 billion yen/for 55 million pieces in fiscal 2006 to 200 billion yen/for 80 million pieces, by promoting ODM product operation from the material stage to manufacturing (design provided OEM) as well as developing its strong area with stable profits ,such as uniforms.

Its expansion will be started from uniforms for Japanese private companies, and be extended gradually to Japanese companies and then to domestic companies in China, with sewn products manufactured mainly in China for the present. For sporting and casual use, it has indicated a policy to beginning the full scale process for approaching overseas sports manufacturers with ODM products, making use of characteristics of its functional materials.

Reinstatement rate of rural migrant workers for apparel companies in Jiangsu is over 80% after Chinese New Year

According to China Textile News, in the face of an increasingly acute labor shortage especially in Chinese coastal areas, apparel compamies in Jiangsu took various measures like arranging pick-up and drop-off for rural migrant workers to and from their hometowns to secure stable production after the Chinese New Year, which resulted in an over 80% reinstatement rate this year. Some of them achieved 100%.

Serious soaring wage and labor shortage in Eastern China

According to local news reports in China, the general level of wages for the textile/apparel industry in the Yangtze delta area is from 900 to 1500 yuan a month, which is higher than other industrial areas. Especially for dyeing industries, there are cases where the wage can be 2500 yuan a month for those who have good skills and work long hours with overtime.

Statistics show that, among the textile/apparel industries, the dyeing area has the highest level of wages, followed by footwear manufacturing, garment cutting/sewing, spinning, twisting, weaving and knitting.

According to statistics of the labor department, labor for the cutting, sewing, knitting and dyeing industries and textile experts have been in short supply nationwide for the past three years, and the supply and demand gap of labor in the textile/apparel industries has reached up to 64 thousand.

Considering the situation in the last quarter of 2006 when there were only 4735 job seekers for garment cutting and sewing work in Shanghai while there were 21,224 job offers, the labor shortage in the textile industry in Eastern China is severe.

Benetton Group of Italy aims to expand in China, India and Eastern Europe

Benetton Group of Italy (casual wear) is aiming to make a 2-digit increase in the amount of sales in China, India and Eastern Europe over the next several years. 　The group now operates 100 shops in China, a number which is scheduled to be tripled. The investment amount for this expansion in 2007 is expected to reach 300 million euros.

EU clothing imports from China in 2006 decrease, while they increase from other countries including Bangladesh

The EU's clothing imports from outside the region again rose in 2006. By country, although shipments from China slowed down because of quotas that were set on Chinese products by the EU, Bangladesh, Vietnam and other Asian countries took advantage of that export control on China and increased shipments. Turkey succeeded with its knit clothing but suffered a setback with woven products. Average prices further rose overall, and on a country basis, products of Bangladesh and Vietnam are low priced, but unit values for Chinese products with more added values show an upward tendency.

1. Aspects by country

(1) China

The quotas on China had a dramatic impact especially on shipments of knitted clothing in Chapter 61, which dropped 2% from the previous year in 2006, while there had been a tremendous increase of 54% in 2005. China's share of EU's clothing import market dropped to 30% in 2006, whereas it had expanded to 34% in 2005. On the other hand, the share of Hong Kong expanded from 2.5% to 3.3% due to cases going through Hong Kong to avoid China's voluntary export restricting. Unit value increased for knitted clothing by an average of 9.3% (rise of 1.0% in 2005).

Woven clothing imports (Chapter 62) had less impact from self-imposed restrictions than knitted clothing and increased though only moderately by 4.7% in 2006, while there was a 39% year-on-year increase in 2005.

The import value amounted to 11.65 billion euros, increasing by 14.2% as well as the volume, and the share of Chinese products expanded to 35.8% in contrast with knitted clothing. Its unit values were still low compared to other countries, but increased by 9.0% whereas it was 1.9% in 2005.

(2) Bangladesh

It was Bangladesh that benefited the most from the export control on China by the EU. The county has the advantage that it can manufacture sewn products at low cost and its imports of knitted clothing (chapter 61) to the EU in 2006 increased by 16.6% and those of woven clothing (chapter 62) by 23.7%. Bangladesh's share of EU's clothing import market was 15.9% for knitted clothing, which was ranked third after China and Turkey. That of woven clothing was 8.6%, which ranked second after China (on a value basis, knitted clothing came third, and woven clothing seventh).

(3) Other Asian countries including Vietnam

Vietnam also benefited from the export controls on China by the EU next to Bangladesh. The quota between Vietnam and the EU had been abolished even before Vietnam's accession to WTO in January 2007. Imports of knitted clothing from Vietnam increased by 194%, and those of woven clothing increased by 116%. However, the import volume did not reach that of Bangladesh, and its share only increased to 3-4%, having been less than 2% for each item before. Other Asian countries such as India, Pakistan, Indonesia, Cambodia and Sri Lanka each received favorable effects from China's export controls.

(4) Turkey

Outside Asia, imports of knitted clothing from Turkey increased by 22%, while those of woven clothing dropped by 7.8%, showing different trends by item. However, Turkey's share of EU's clothing import values was second after China (5 billion euros for knitted clothing and 3.1 billion euros for woven clothing). On the other hand, Mediterranean countries other than Turkey were in a struggle to survive.

2. In value terms

Despite the progressive appreciation of the euro against the dollar in 2006, the value rose overall. Chinese products, especially were on an upward trend. Compared to China, products from Bangladesh and Vietnam were in the low-priced range, where products from India in the upper. Like Chinese products, those from India are on an upward trend for values, nearing prices of products frrom Mediterranean countries including Turkey and Morocco.

Textile industry in France calls for extension on Chinese export control

It is reported that the textile industry in France has called for quotas on Chinese imports into the EU which will expire at the end of 2007 to be extended. It seems the European Apparel and Textile Organization (Euratex) has agreed with this idea as well.

The French Textile Industry (UIT: Union des Industries Textiles) said the agreement between the EU and China is obviously unfair. That is, the EU market, which will be open at the end of 2007, will be exposed to the threat of Chinese textile imports because of agreements between the US and China that China's quotas between them will continue until the end of 2008. It says this is suicide for the EU. Euratex has made the same kind of request to the European Commission and especially to Mr. Mandelson the EU's trade commissioner who signed the agreement between the EU and China. It is considered difficult for this call to be admitted due to political factors, but still it has received a lot of attention since protectionist Portugal will be the EU presidency holder and France's presidential election will take place during 2007.