Market, today, is pushing through severe headwinds in the form of hi-rising costs for petrochemical products, transportation and for energy whether its oil, gas or electricity. How will it affect industry in Japan and worldwide? What activities of JCFA shoulder the burden of your members in fight with such situations?
One of the largest concerns at present is a rise in the price of raw materials and fuels due to the high crude oil price. The crude oil price (WTI) increased by 94% from $54.4 in January 2007 till now around $120. The high crude oil price has caused a rise in prices of raw materials of synthetic fibers.
As for the trends of prices of apparels, on the other hand, the prices remain almost unchanged in Japan.
With high raw material prices and low product prices, the chemical fiber industry has found it difficult to pass the rise in the cost of raw materials and fuels on to product prices. In such environment, the profitability of the industry is worsening.
In order to cope with such serious situation, it is absolutely important to supply value-added products, less subject to market prices, that meet the needs of users in close cooperation with users.
Geographically, in which countries do you visualize the growth potential of this sector the most?
For Japanese textile industry, China has been the most important partner and largest exporter and importer. However, in recent years, we are viewing the moves to avoid over concentration on China, due to the reported Chinese risks as a production center or product sourcing center for Japanese textile industry. The risks include foreign exchange risks, revaluation of Chinese Yuan, labor shortage, rising wages, shortage of electric power, and other policy changes. In view of such moves, many Japanese textile companies feel the need to strengthen collaboration with countries outside China such as ASEAN countries, India and Bangladesh, with ‘China-plus-one’ strategy.
At this moment, some Japanese companies would like to make maximum use of Japanese EPAs with ASEAN countries. Among others, Vietnam is one of the most promising partners.
At the same time, as we are very much interested in the Indian textile industries, during our Business Year 2008, JCFA is focusing on the ‘Study on Indian Textile Industries’.
What is your say on the role of trade fairs and events in the select sector? Do JCFA organize any events or trade fairs? Which are they?
Actually, there are not many trade fairs relating JCFA, but new initiatives the textile industry has taken of late to create new markets include: cooperation in the 'TOKYO FIBER' exhibition -the first of which took place in April 2007.
Nowadays, a lot of stress is being given on ecologically safe products and production. How does JCFA encourage this move?
Regarding the environmental issues, we think- it is a permanent challenge for businesses to carry on productive activities. The challenges that JCFA is now facing are further reinforcement of measures against global warming, energy conservation, and chemical substance control.
The Japanese chemical fiber industry has achieved about 50% reduction in energy intensity (from 1.74 to 0.85) during the approximately 30-year period from 1973 (the first oil shock) to 2006.
In order to achieve CO2 reductions to combat global warming, JCFA came up with the goal of 'reducing energy intensity by 10% from the 1990 level by 2010' and this goal was practically attained by 2006. Moreover, JCFA member companies are deeply committed to global environmental problems and announce their activities in an 'environment report'.
Working to solve the various problems, JCFA formulated guidelines for an environmental action plan in 2003 and based on these guidelines such as ;
1) JCFA created an environmental management system in compliance with the ISO14000 and is carrying out activities to acquire ISO certification. At present, all Japanese chemical fiber plants have acquired the ISO14000 certification.
2) JCFA aimed to reduce energy intensity by 10% from the 1990 level by 2010.
3) JCFA is carrying measures against air pollutants and water contaminants, is working to achieve compliance with the PRTR Law (the Law Concerning Reporting of Releases to the Environment of Specific Chemical Substances and Promoting Improvements in Their Management), and is implementing measures against soil pollution and groundwater contamination.
4) JCFA is pushing ahead with reductions in the production and effective use of industrial wastes, and is seeking to reduce the quantity of industrial wastes disposed of in landfills by outsourcing contracts by 40% from the 1990 level by 2010. Also it aims to increase the amount of industrial waste recycled by 15% from the 1990 level in 2010.
5) JCFA is pushing ahead with 3R’s (Reduce, Reuse and Recycle) activities. Chemical fiber plants have long been working to reduce the volume of textile wastes produced by chemical fiber plants and recycle these wastes. In 2006, the plant-produced textile waste recycling rate reached 98%, an already sufficiently high level, but nonetheless this industry continues to promote activities in order to maintain the current level of textile waste recycling.
What could be said for Japan’s Chemical Fibre industry by 2010?
Report entitled ‘the Prospects of the Japanese Textile Industry and Challenges Confronting the Industry’ commonly known as ‘Textile Vision’ was provisionally compiled in May 2007.
Textile Vision describes the significance of existence of the Japanese textile industry and the direction in which the industry will grow in the years ahead, analyzes problems facing the textile industry and drawbacks it should overcome, defines the roles the industry and the government have to play in coming to grips with challenges ahead, and prescribes actions the Japanese textile industry should take, focusing on the three pillars, they are;1) promotion of structural reforms; 2) reinforcement of technology; and 3) reinforcement of proactive dissemination of information and brand power.
For survival in the future, as in Textile Vision, the Japanese chemical fiber industry will try very hard to maintain our technological superiority. As a result, we are anticipating a bright future.
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.