Home    Resource Store    Past Issues    Buyers' Guide    Career Center    Subscriptions    Advertising    E-Newsletter    Contact

http://www.schlafhorst.saurer.com
http://www.expoproduccion.mx/Content/Exhibitors/24/
http://ahweb.adsale.com.hk/t.aspx?unt=2354-STX15_TextileWorld
http://ahweb.adsale.com.hk/t.aspx?unt=2396-ZhejiangTex14_TextileWorld
http://www.textileservicesonline.com
http://www.textileworld.com/Textile_World_Innovation_Forum_2014/
http://www.textileworld.com/Store/Books/diccionario-textil.html
http://www.textileworld.com/Store/Books/index.html
July/August 2014 July/August 2014

View Issue  |

Subscribe Now  |

Events

SPINEXPO™ Shanghai
09/02/2014 - 09/04/2014

FMCEX 2014 - The 6th International Floor Covering, Moquette, Machine made Carpet & Related Industries Exhibition
09/06/2014 - 09/09/2014

41st Annual S.C. International Trade Conference
09/08/2014 - 09/10/2014

- more events -

- submit your event -

Printer Friendly
Full Site
Yarn Market

Spinners Concerned About Korea

Jim Phillips, Yarn Market Editor

If there is a single word that defines the American textile industry over the past 30 years, it is "resilient." Time after time, the industry has faced adversity and has persevered. Beginning with the movement of commodity manufacturing to Central America and Asia in the 1980s through the emergence in the last decade of China as a global manufacturing center, the industry has reoriented itself to focus on those aspects of business in which it excels.

When U.S. yarn spinners found they could no longer compete with the likes of Taiwan and South Korea in price, they focused on quality, customer service and delivery. They often more than offset price disadvantages by providing better product to their customers in a timeframe their competitors could not hope to match. Spinners became quick-change artists, abandoning the historically common long runs of commodity materials, and focusing on shorter runs of highly specialized products. When offshore competitors responded by even further lowering their prices, U.S. companies countered by offering even faster turnaround and better end-to-end customer service.

Even during those periods when it looked as though one government program or another — or one recession or another — would finally sound the death knell for a struggling industry, innovative leaders had other ideas. Rather than continue to fight an ultimately unwinnable battle, the U.S. industry downsized, aligned its capacity with demand, and put automated processes in place that made it among the world's most efficient manufacturers.

After years of cocooning itself from the rest of the world, the industry finally came to terms with the fact that it is just one player in a global market and developed executable export strategies. The United States is now the world's third-largest textile exporter. The net result is that the last few years, even in the midst of economic upheaval, have been among the most stable in recent memory for the industry.

And just when it seemed that things were finally on an even keel, a new trade agreement with South Korea once again threatens the very foundations of the industry. The reaction of spinners to this trade agreement is one of universal disbelief and fear. "It opens the door for what could be an absolutely devastating situation for the U.S. industry," said one spinner. "Because of the lack of critical enforcement measures, there is a real possibility of illegal transshipments from China, particularly in technical and industrial textiles. It's really not so much what it means for yarn spinners as what it means for our customers. It is the fabric manufacturers that have the greatest exposure."

Additionally, tariff reductions will allow Korean companies to even further reduce prices, which have the potential to offset the U.S. advantage in delivery and service. One textile executive was quoted as saying, "We're quick and nimble, and we forge strong relationships. But those companies will start looking away for savings of 25 and 30 percent."

Another provision of the bill that concerns U.S. manufacturers is that Korean companies will have access to U.S. markets almost immediately, while U.S. access to Korea will be phased in over a period of years.

NCTO President Cass Johnson said: "We want to ensure that free trade agreements actually support increasing exports and increasing textile jobs in this country. We will strongly support agreements that provide an equal playing field for the beneficiary country, but will strongly oppose those that don't."

Orders And Prices Fall Dramatically
Orders for both open-end (OE) and ring-spun yarns have fallen dramatically over the past month, and prices, which had been relatively firm despite the falling cost of raw materials, have plummeted as well.

"I'm an optimistic person by nature," said one Carolinas spinner, "but it's hard to find anything to be optimistic about right now. We're just not selling anything. We've had some ups and downs over the course of the year, but as of the past few weeks, everything has just come to a grinding halt."

Said one yarn broker: "OE yarns have just fallen off the world. Ring-spun is still okay, but not nearly as strong as we had hoped. It seems that consumers are becoming increasingly concerned about the economy and are holding off on purchases. And with so little demand being generated, prices are falling very quickly."

Looking toward the end of the year, spinners are cautiously optimistic that business will get stronger. "Retail sales increased by 1.1 percent in September, the largest increase in the last seven months," said one spinner. "And if we see an increase again in October, that may be a sign that we've turned the corner and can expect better times in the next few months."

Another spinner said that the combination of weak economic conditions and a glut of inventory is the most likely cause of the current and slowdown in orders. "I have to think that once inventories begin to diminish, the demand will pick up and we will see some positive occurrences by the beginning of the year."

October 2011

Advertisement

http://www.staubli.us


Related Files:
Click here to download current yarn prices