Home / Knowledge / News / Textiles / Crisis affects textile value chain from farmer to retailer

Crisis affects textile value chain from farmer to retailer

19
Dec '08
Many textile enterprises say overall sales of textile products performed well in the first half of this year, however, midway through the year, orders of textile industry have significantly reduced even falling by as much as 40 percent.

Related research shows cotton yarn prices in the last few months have fallen by a higher proportion than the drop in raw cotton prices, the result of which, spinning enterprises have started to face substantial losses leading to over most of the downstream enterprises facing trouble due to rising inventory levels.

As a result of a more abnormal fall in cotton yarn prices and growing inventory levels at the same time, the textiles have cut down on their operating rates or shut down completely. This has also resulted in workers wages being lowered substantially while others are facing massive layoffs. The whole textile industry chain depicts a picture of overcapacity, large inventory and tight capital situation.

The foreign trade figures of the sector in November depict that the financial crisis has intensified, demand in export market has shrunk and the textile industry is bearing the brunt of the crisis with difficulties increasing with each passing day.

At present, two-thirds of China's textile enterprises are realizing a mere profit margin of about 0.6 percent with many enterprises facing risk of collapse and resulting in a decline in demand for cotton. This is leading to the whole value chain getting disrupted right up to the door steps of the cotton farmer.

The industry is also facing the difficulty of servicing their loans leading to an increase in interest costs and thereby adding more woes to the already over burdened sector. The worst part is that they are also not able to access new credit to keep their enterprises running.

Fibre2fashion News Desk - China


Must ReadView All

Pic: Shutterstock

Textiles | On 10th Jul 2020

US, Kenya launch negotiations for free trade agreement

United States trade representative Robert Lighthizer and Kenya...

Pic: Shutterstock

E-commerce | On 10th Jul 2020

Commonwealth, ILO join partnership for inclusive e-com

The global 'eTrade for All' initiative, which aims at making digital...

Pic: Nike

E-commerce | On 10th Jul 2020

Nike Rise unveiled in Guangzhou as new store concept

Nike recently introduced Nike Rise, a first-of-its-kind store...

Interviews View All

Sanjay Yagnik, Maa Tex Speciality

Sanjay Yagnik
Maa Tex Speciality

‘We suggest reducing dosage of sizing chemicals to reduce sludge...

Top executives, Textile industry

Top executives
Textile industry

In 10 years' time, everything will have the responsible factor integrated

Manuj Terapanthi, Texaura

Manuj Terapanthi
Texaura

Transparent supply chain and fair trade will boost sustainable market

Sarah Perkins,

Sarah Perkins

Fairfax, Virginia-based Specialty Graphic Imaging Association (SGIA) is a...

Apurva Kothari,

Apurva Kothari

No Nasties was the first fashion brand in India to make 100 per cent...

Prakhar Singh,

Prakhar Singh

Morgan Tecnica offers the largest and most modern range of solutions for...

Sachin Pendharkar, Dieffenbacher India Pvt Ltd

Sachin Pendharkar
Dieffenbacher India Pvt Ltd

Germany-based Dieffenbacher Group is a producer of high-quality composites ...

Prof Seokheun (Sean) Choi, Binghamton University, State University of New York (SUNY)

Prof Seokheun (Sean) Choi
Binghamton University, State University of New York (SUNY)

A team of researchers from the State University of New York (SUNY),...

Hemant Bheda, Arevo

Hemant Bheda
Arevo

Arevo, based in Silicon Valley in California, develops technology to...

Niti Singhal, Twee In One

Niti Singhal
Twee In One

Best known for convertible clothing, Indian brand Twee In One by designer...

Rupa Sood and Sharan Apparao, Nayaab

Rupa Sood and Sharan Apparao
Nayaab

Nayaab, an exhibition meant to celebrate Indian weaves, is in its second...

Bani Batra,

Bani Batra

Bani Batra’s couture wedding collection is inspired by traditional Indian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


July 2020

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Advanced Search