Good orders fail to please Vietnamese garment exporters

February 28, 2013 - Vietnam

Good inflow of export orders has failed in bringing a confident smile on the faces of Vietnamese garment producers.
 
This is because, while most of them are getting good number of export orders at around 10 percent higher prices above last year, the cost of raw material on the other hand has gone up by 10-15 percent, which continues to keep these firms under caution over execution of the orders.
 
According to a vietnamnet.vn report, following a global recovery, Vietnamese garment firms are receiving good number of orders this year, mostly from the US and Japan. 
 
Saigon 2, a garment firm based in HCM City, has even been required to run in shifts to execute an order received from a Japanese importer for women’s khaki trousers, a senior official of the firm said.
 
Vietnam Textile and Apparel Association (Vitas) Deputy chairperson Pham Xuan Hong said around 90 percent of Vietnamese apparel firms have bagged orders to keep them busy till June 2013 end, while 50 percent have booked orders to suffice till end of the year.
 
The rise in export orders not only has created new jobs, but has also eased the worker’s woes as they are getting stable income, he said. As exporters have enough orders, they are in a position to negotiate their contracts for best prices, he added.
 
However, he noted that in spite of good orders, exporters are worried as there has been a considerable rise in the cost of raw materials.
 
According to the Ministry of Industry and Trade, with a year-on-year rise of 28.4 percent, the country’s garment exports reached US$ 1.05 billion in January this year.
 
The Vietnamese Government has set a target of US$ 19 billion for textile and garment exports this year, up 15 percent over 2012 export figures.