NUOVATEX TEXTILE OUTLOOK

Major Global Trends for Textiles & Retail

1. Cotton prices ,yet  upwards

The global  Cotton  price trends  are ruling firm vis a vis expected higher consumption in new crop year.The ICE Cotton Futures for Dec.2021 at $0.95/Lb.

2. Unprecedented growth in Online business

 The  global manufacturing and supply chain growth  for the Q3  and Q4  for the covid 2021  period to be led by India, China ,Cambodia Pakistan for textiles.

Global economic recovery post Covid is expected to be mainly  led by the above SE Asian countries led by China, India. However, in the textile domain the setback will be there due to yet severely  Covid impacted countries of S. Korea, Vietnam and Bangladesh. Also, shortage of containers and high freight cost is upsetting the `apple cart` for both the the textile exporters and their buyers in USA and EU.

 [Global textile recovery post Covid to be led by India subsequent to its lead via export of yarns, home textiles, terry Towel etc. and with no  3^rd covid wave onslaught as of yet owing to 550 Mln vaccinations].

INDIA’S Mega Trends

1. India’s cotton output  for  the  season 2020-21 is  now pegged at 34.5 Million Bales;and the projections for the new crop of 2021-22 estimated 35.5 Mln Bales. Cotton  prices  are still at  a high leading to std 30s/1 Ne Cotton carded yarn ruling at Rs 256 /Kg. The corresponding 30 Ne Comb yarn at FoB, Rs 285/Kg.
2. India’s overall textile Fiber production has nearly `doubled` over last 20 years. All fibers prod`n increased to new high of 110 Mln TPA in 2020  from 58 M TPA  recorded in 2000.
3. The Govt. is  making  focused efforts  to sign new FTA `duty free `agreements esp. with UK, Australia and the UAE.This will improve India s  competitivness.
4. India‘s E- commerce retail markets are growing phenomally at 30% p.a to reach $ 120-130 Bln by 2026. However, major MNC  e –  co ` like  Amazon and Walmart controlled Flipkart are facing strong  headwinds from India s  regulatory bodies  and also from major  New domestic  e com retail players like  big Indian corporates namely, Tata and Reliance Gr.

• [This has increased the pressure on the  model of the likes of Amazon and Walmart,and will lead to their reduced  share in India s growing E com markets from now onwards,registering 30%]

New Growth Engine for Indian Textile industry

1] The  New  growth engine  to  drive  Indias  export  and textile  manufacturing sector is perceived to be the new Ro DTPE  scheme in addition to the continuing ATUF  and the RoSCT scheme to help  subsidise the domestic  transaction costs of the Textile  industry. The  RoDTEP  incentives  will be in range of 3.1% to 3.8% of the export FOB value of Cotton/yarns. This will have a cap of   about $0.27\    Kg  for the export of cotton Yarn ,and $  0.85 per Sq Mtr for  Cotton woven fabrics.

2] It is  also projected  with ongoing 30% growth in the E commerce stream for domestic markets. Such Online  retail is likely to  displace the share of the traditional `shop trade`in 5 years that’s by year 2030.

3]The new segments of development and  growth in domestic technical textile products are key engines of growth and uplift of India’s Textile and apparel/made ups industry.However, this growth stream is  yet to pick up mainly due to cloudiness in understanding of right Tech-tex products and their consumption trends.

WAY FORWARD FOR INDIA’S TEXTILE INDUSTRY

The way forward and Road map for further expansion of India’s textile industry, and enhancing its global share to more than 5%, is clearly via increased focus on manufacturing and exports of Polyester  and blended textiles and `value adding ` cotton products like Yarns  and terry Towels, Knit apparels and also Technical Textiles and Home textile.

However,the exploration and entry into new Textile  markets is a big ` Must` as also  the duty free access  to 3-4 key Textile markets with `duty free ` access into the preferential FTA agreements in competitiveness to GSP+ exporting countries like B.desh,Vietnam,other

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