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Yarn Market
Jim Phillips, Contributing Editor

Tough Times For Specialty Spinners

Jim Phillips, Contributing Editor

R ecent closings of bed and bath accessories plants in the United States and the migration of the yarn spinning for those products to overseas producers have literally pulled the rug out from under some yarn spinners and dyers.

"We've lost two-thirds of our business in just the past several months," said one specialty ring spinner. "Ten years ago, we used to do a lot of yarns for bath rugs, but most of that has now moved to India. In December, we lost our last big rug business, when our customer moved its last domestically made cotton bath rug to India. Then, we lost a blanket yarn to Brazil. As a result, we've had to completely change our business.

"We were in a position where we had to make a choice," he continued. "We had to change or shut down." He said his company is trying to survive by catering to small, niche markets. "We're talking about 500- to 1,000-pound orders. "We try to supplement that with whatever we can get."

"Now, we are basically just running one 10-hour shift four days a week. We had a layoff in January of two shifts. We're getting more and more specialty and niche inquiries every day, but we just haven't seen a big program that would generate enough business for us to hire people back."

Dyed Yarns Also Slow

In addition to the struggles of some specialty spinners tied to specific markets, production is down for some US dyehouses as well, especially those that had large business arrangements with bed and bath product manufacturers and hosiery companies.

"The market is difficult right now," said one dyer. "We are continuing to lose customers. They are continuing to opt sourcing of finished products in the Orient. Today, when you lose a customer, it's hard to go out and find a new one."

He continued, "The trend seems to be more and more to smaller lots as people are trying to control their inventory. Our challenge is to make sure we have the best quality of service and delivery and quick turns and be able to provide the customer with the smaller lots faster and better than the competition."

Currently, he said his company has a good backlog of work on its 500-pound or less machines, but has trouble keeping the larger machines working.

"We continue to keep looking for value-adds and new products and/or processes that will help our customers generate sales. We've had some excitement around organic cotton. People are beginning to think green and sustainable in their textile products, and we are certified as an organic dyer. We're seeing more and more of our customers doing some sampling and building lines of organic products to augment their existing lines. We've seen some pickup in business in this area, so we are hopeful."

A major concern for dyers at the moment, he said, is raw material costs, which have escalated proportionately with the recent increase in oil and gas prices. "It's difficult to pass those along," he said. "Combined with the recent increases in cotton prices, it makes it hard to generate any kind of margin."

Fine Counts Doing Well

While some industry segments continue to struggle, fine-count yarns appear to be moving well.

"We've had a good year so far - beyond what we expected," said one spinner. Said another: "We don't have any problem moving fine counts at a competitive price."

Additionally, fine-count spinners have had some success in passing cost increases along to customers.

"We've had to do it; we really had no choice," said one spinner. "Our customers have realized that raw materials costs are now to the point that everyone is going to have to charge more."

He continued, "Business has been good. But, then, we don't have as much production as we used to have. I think that's the case with a large number of spinners. We've adjusted the number of production plants to align with the needs of the market. Given that, I think there has been a general supply and demand realignment. As a result, there is more to go around than maybe just a few years ago. For example, we've reduced our capacity in carded ring-spun, and so have many others. It means carded ring-spun isn't easy to come by, and it has tightened up the market somewhat."

May/June 2008

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