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

More Business & Financial

More Positive News
November 23, 2015

Profits Edge Higher
October 13, 2015

An Industry Update
September 22, 2015

Fiber Costs Move Lower
August 18, 2015

Rosy Earnings Picture
July 20, 2015

Textile World Photo Galleries
November/December 2015 November/December 2015

View Issue  |

Subscribe Now  |


Vietnam Fashion, Fabric & Garment Machinery Expo
11/25/2015 - 11/27/2015

From Farm To Fabric: The Many Faces Of Cotton - The 74th Plenary Meeting of the International Cotton Advisory Committee (ICAC)
12/06/2015 - 12/11/2015

Capstone Course On Nonwoven Product Development
12/07/2015 - 12/11/2015

- more events -

- submit your event -

Printer Friendly
Full Site
Business & Financial
Robert S. Reichard, Economics Editor

Still No Mill Pickup

Robert S. Reichard, Economics Editor

S econd-quarter results remain quite gloomy, with the industry’s demand and price levels unable to muster any meaningful turnaround from the low levels of late 2002 and early 2003. Blame part of this on today’s still-anemic economy, as the gross domestic product (GDP) just barely manages to stay in the plus column — in marked contrast to the 4- to 5-percent annual growth rates of a few years back.

Other downward-tugging factors include: lingering Middle Eastern political uncertainties; consumer job worries; a resumption of strong textile and apparel import gains; a continuing mill profit squeeze; and a stock market still unable to mount a strong, sustainable rally. Second-quarter textile mill orders, production and shipment totals leave a lot to be desired. Output lagged year-ago levels by about 4.5 percent, with shipments off by about 2 percent over the same period. As for prices, the key government greige goods yardstick is off 4.5 percent from a year ago. Finished fabrics and home furnishing quotes also lag behind year-ago readings.


Some Hope For A Better Second Half

True, nobody sees a major pickup in textiles. But, for the first time in more than a year, there seems to be some light at the end of the tunnel. The end of the war in Iraq should make both businesses and consumers a little less nervous. Upshot: Economic forecasters now see some uptick in GDP growth — perhaps into the 2 to 3 percent range by fall.

The fact that oil prices are easing also should help, leaving more income available for additional purchases. Even more encouraging is the turnaround in consumer confidence — with one recent Conference Board report showing the second-largest gain in more than 25 years. There’s even a positive spin to the recent slowdown in car sales: Other things being equal, this should free up more money for apparel and home furnishings purchases. Relatively trim mill and mill product inventories also offer some hope, suggesting that any new orders will translate quickly into new production.

There’s even a ray of hope on the trade front, as the dollar slowly continues to weaken. Down about 5 percent over the past year, it will tend to make imports a bit more expensive and exports somewhat cheaper.

Innovative Products Also Help

The steady flow of new and improved products hitting the market also should buoy the industry in the quarters ahead. DuPont has announced such new offerings as its CoolMax® Everyday for slacks, a colorfast sock fiber that wicks and stretches, and a Tactel® nylon/Lycra® blend for warp knits targeted for
the women’s market. Moreover, the company is promising three more innovations by year’s end.

Elsewhere, khaki makers have introduced specially treated premium-priced slacks that incorporate stain-repellent molecules into the fiber, making them more likely to shed stains. New attempts also are underway to beef up somewhat-slow denim-buying. Big things are expected from elastic fibers that would add denim to the growing list of techno-fabrics. Also, some elements of the apparel industry are now coming up with electrical connectors and controls physically integrated into garments. Not surprisingly, the Pentagon is doing a lot of research in this field — in the quest for high-tech uniforms for its digitally equipped troops.

Fiber Costs Move Higher

Man-made fiber tags are on the rise again. The most recent increases reported include a 5- to 11-percent advance in nylon 6 quotes, a new 10-percent boost in polyester filament, and a 7- to 9-percent hike in rayon staple quotes. These are in addition to increases earlier in the year. Indeed, when all of the above are fully implemented, man-made fiber price averages should be up significantly vis-a-vis year-ago levels.

Cotton quotes also have turned a lot more bullish. They recently jumped up into the mid-50s - a sizable 25 cents per pound above year-earlier readings. Though followed by recent corrections, the overall buoyancy is likely to persist on a combination of: strong US exports, which should hit a record 11.5 million bales for the 2003-04 marketing year; expected inventory drawdowns; and a less-than-sensational US production year. On the latter score, the Department of Agriculture puts 2003 output at only 17.2 million bales. While unchanged from last year, that's below earlier market expectations. Bottom line: further modest sales hikes for this key natural fiber can't be ruled out in the months ahead.

June 2003

Related Files:
Download Current US Textile and Economic Indicators.