Cotton market is experiencing ill-fate times due to low production and steep price rise. Cotton yarns being your one of the line of operations, will it affect your business? What can be said on global cotton market shaping up in this context?
Mr Stefanus Kotjo
Cotton market will certainly affect our bussiness.
We are extremely concerned with the current cotton fibre situation globally, as almost 70% of the products manufactured are cotton. We understand that cotton being a natural fibre would always remain an unpredictable proposition specially, nowdays Cotton future trading is becoming a target of speculative global funds.
fibre2fashion:
Post an agreement between China and the EU, exports of China's textile products to the EU countries will not be subject to any quantity limits starting this year, and textile export quotas to the US will be abolished in 2009. How would you comment on repercussions of this announcement on Indonesian textile industry?
Mr Stefanus Kotjo
This agreement would definitely give China some advantages to penetrate deeply and increase the coverage of the EU market. However, we all are aware that the costs (labour / energy / fuel) are increasing in China. Therefore in a few years time, China would also be a pal with the rest of ASIA on the production cost. Eventually it will boil down to;
Quality
Service
Product features
In a nut shell it will be a more level playing field.
fibre2fashion:
US is the largest market for Indonesian textile and apparel exports. What all adversities, do you envisage that current recession in US may cause? How will this affect your business?
Mr Stefanus Kotjo
We have already started experiencing the impact of slowing down of US Economy. The orders have died down and this trend does not seem to be reversing anytime soon. In order to continue this, we have decided to look internal (local domestic market) and also external untapped markets like ASEAN, Egypt, etc. There is also a possibility of entering into Russian / East European markets. The idea is to minimize the impact of US meltdown and to reduce our dependence on the US market.
fibre2fashion:
For the company of your capacity, what other challenges do you see cropping up in your industry? What will help APACINTI to wade these challenges triumphantly?
Mr Stefanus Kotjo
We anticipate the following challenges:
-Growing labour cost
-Growing energy cost
-Growing material and chemical costs
-Decreasing the selling price due to decreasing buying power for textile products.
To overcome and conquer these challenges we have to:
a. Cut fixed costs
b. Increase the speed and variety of new developments
c. Focus on the strength of the Company
fibre2fashion:
Any forecast on upcoming trends in Denim industry?
Mr Stefanus Kotjo
The forecast on upcoming trends in denim industry are such as:
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