Textile sector frayed but resilient
Updated: 2012-08-03 07:56
By Zhang Yuwei (China Daily)
A visitor selects products at the textile trade show, which attracts many Chinese exhibitors. Yu Wei / For China Daily
At New York trade show, innovation is seen as key to industry's future
Matt Moses was navigating the rows of the exhibit-hall floor, lined with nearly 700 textile suppliers from around the world. He was looking for something in particular.
"I found a few things that I needed that are not easy to find - like more niche products that are not basic sheets and towels," said Moses, vice-president of sourcing and business development at Revman International Inc, a New York supplier of high-end home furnishings.
Moses, a regular at previous shows, said this 13th China Textile and Apparel Trade Show met his expectations. In fact, it was better than he expected, partly due to the sheer number of Chinese suppliers on hand - 356, or 60 percent of the exhibitors in late July at the Jacob K. Javits Convention Center in Manhattan.
The number does not tell the whole story of the modern textile industry, in China or abroad. The show took place at a time when textile and clothing manufacturers everywhere deal with relentless pressure on their businesses, such as the impact of the 2008-09 financial crisis and the slow recovery in most countries.
The Chinese textile industry experienced "an extraordinary year", said Zhang Yankai, vice-president of the China National Textile and Apparel Council.
Zhang, who headed the Chinese delegation at the New York show, said the sluggish global economy, slow growth in international trade, rising prices for raw materials, and increased production and environmental costs all contribute to the industry's struggles.
"These unfavorable factors posed challenges for development of the Chinese textile industry, for sure," he said at the opening of the three-day exhibition. The show was "an impressive achievement that didn't come easily", he said.
"However, the textile industry in China held fast to the road of scientific development, steadfastly restructuring and upgrading, and with the efforts of the industry as a whole and the enterprises within it, turned in impressive results nonetheless."
Textiles, a key contributor to exports, generated $197 billion in the first quarter of this year, down 17 percent from a year ago due to reduced demand from major importers such as the United States, according to the National Development and Reform Commission.
The export value of textiles and garments during the first quarter totaled $71 billion, just 1.07 percent above the same period of last year, according to the China National Textile and Apparel Council, which linked slowing exports to higher domestic prices for cotton.
Innovation is key
In China, the increasing cost of labor has spurred the transfer of low-level processing jobs to other Asian countries such as Bangladesh and Vietnam. Many Chinese textile producers will have to become more innovative to survive.
"Although many US buyers are buying low-end products from China's neighboring countries now, they rely more on high-end products and design from China. So the relationship of China and the US in bilateral trade is still inseparable," Zhang said.
At the Javits Center, Chinese exhibitors showcased not only traditional fabric items such as cotton and silk but also domestically branded garments, hoping to open a new pathway in New York, one of the world's fashion capitals.
"Many suppliers came here with products they designed and made on their own," Zhang said, as he moved from one exhibitor's stand to the next. "They're no longer satisfied with doing simple processing like before, which is greatly significant for our textile industry to develop in a healthy and stable way."
Qingdao Mirtos Textiles Co Ltd, a leading factory in China, came to the New York show for the first time with a clear plan: to gain US customers, having established a name among European and Australian customers after attending trade shows in Frankfurt.
Mirtos' product line features midrange and high-end bedding accessories that can be found in some upscale European department stores. The company's managing director, Wang Ruping, was in New York.
Wang said Mirtos has had sales growth of 30 percent in each of the past few years, even during the worst of the financial crisis.
"We thought it might be a good move to enter the US market," said Wang, who hopes American hotel chains - a lucrative potential customer base - will follow European ones and change from basic sheets to delicate duvet covers, which Mirtos produces.
Although a first-time exhibitor at the New York show, Mirtos is no stranger to the US market. At the Frankfurt trade shows, the company drew attention from some US clients and recently received orders from the discount retailer Target Corp, which in will launch its first line of Mirtos-made products this month.
The company, Wang said, has passed audits on ethical practices and technical skill for the department store chain Macy's Inc, and received a price quote from JC Penney Co.
"I think our biggest advantage is the updated and fashionable design," he said.
Shift of dynamics
Since 2010 the Textile and Apparel Council has teamed with Messe Frankfurt GmbH, a German producer of international trade shows, to make the New York event more professional. The 356 Chinese exhibitors were joined by textile producers from South Korea, Turkey, Indonesia, the US and other countries.
Laguna Fabrics of Los Angeles has made deals every year it was at the show, David Roshan, the company president, said.
For US exhibitors such as Laguna, escalating costs in China mean a shift in the industry's dynamics.
"The rising labor costs in China actually create opportunities for us since we are the US-based company," he said. "Our exports have increased continually compared with Chinese textile companies in this exhibition. Our biggest advantage is speed."
Such sentiments make some regular Chinese exhibitors nervous. On the third and final day on the exhibition floor, Chinese suppliers sat at their stands, anxiously waiting for more customers to drop by and hoping to secure deals, big or small, to make their New York trip worthwhile.
Fujian Zhonghe Co Ltd, a fabric exporter and an annual exhibitor at the show was pessimistic about the results.
Zhonghe has been counting on being able to offer cheaper fabrics, mainly cotton, to US customers, said Guo Zhennan, a sales manager for the company. He declined to identify the customers.
Even with a stand, which costs about $8,000 for three days to rent at the exhibition, Zhonghe's products attracted fewer visitors on the floor than in past years.
"Because of the recession, orders from the US are sluggish," Guo said.
China has been losing its advantage in the industry because of a dependence on lower-level skilled jobs that are being outsourced to its Asian neighbors, he said.
The manager described the Chinese textile industry as "a sunset industry", and agreed, like many others on the floor, that more innovation is needed.
"I don't know yet what we will do to innovate," Guo said. "We thought we'd at least come here to boost the morale and give it a try and support the Council at this event."
Yu Wei contributed to this story.
(China Daily 08/03/2012 page16)