HCMC - Turkey has slapped a temporary duty of 36.28% on partially oriented yarn (POY) products imports from Vietnam since August 4 to prevent an evasion of anti-dumping duty.
The Vietnam Competition Authority (VCA) of the Ministry of Industry and Trade on Monday cited the Vietnam Trade Office in Turkey and the General Directorate of Imports under the Turkish Ministry of Economy as saying Turkey’s measure is designed to fight the evasion of anti-dumping duty imposed on POY products imported from China, India, Malaysia, Indonesia, Taiwan, Thailand and Vietnam.
The measure would take effect until Turkey gives the final conclusion on an investigation of anti-dumping duty evasion. Turkish agencies have launched an investigation into the issue since February last year following a petition by a company.
The Turkish Ministry of Economy said the temporary duty was issued due to an upsurge in POY imports into the country in the 2010-2016 period.
Besides, some POY buyers are manufacturers of Drawn Textured Yarn (DTY) products. In November 2016, Turkey applied a high anti-dumping duty of over 72% on polyester textured yarn imports from Vietnam.
Previously, Turkey opened an anti-dumping probe into man-made yarn or synthetic staple fibers imported from Vietnam, Malaysia, Greece, Pakistan and Thailand. The country decided to levy duties of 19.48-25.25% on Vietnamese products in five years starting from August 2014.
According to the Vietnam Cotton and Spinning Association, Turkey used to account for a third of Vietnamese yarn exports. However, local enterprises have promoted shipments to China and South Korea due to high anti-dumping duties imposed by Turkey in recent years.
The New Nigeria Development Company, NNDC, says it will invest $15 million through a partnership with a Turkish firm to reactivate the collapsed Kaduna Textile company.
The Group Managing Director, Ahmed Musa, said this to journalists shortly after a closed-door meeting with the Turkish business delegation at the NNDC’s head office in Kaduna.
The delegation had earlier inspected the site of the firm and the Defence Industries Corporation of Nigeria, both at the Kakuri Industrial Layout in Kaduna.
The GMD said the NNDC and the Turkish firm, Sur International Textile, would invest the amount in revitalising the Kaduna Textile.
According to the proposal, the Turkish firm will provide 35 per cent of the amount, the federal government 45 per cent and KTL will give 20 per cent of the funds.
Mr. Musa said in a short term, the KTL would produce uniform needs for the Nigerian Armed Forces as well as the police and other paramilitary agencies in the country, and across the West Africa sub-region.
He said revamping the KTL would boost the economy of Kaduna state and create employment opportunities to the unemployed youths within and outside the state.
“We held a private meeting with a team of delegation from Turkey.
” They want to invest in Kaduna Textile and turn it around.
” In summary, they want to start producing military and paramilitary uniforms for members of the Nigerian Armed Forces,” Mr. Musa said.
According to him, the project is a big and laudable one that will boost the economy of Kaduna State by increasing its revenue drive and create massive employment.
” We have been able to attract investors into the state,” he added.
The NNDC’s Executive Director, Investments, Abdullahi Ali-Gombe, said the agreement would revamp the collapsed Textile firm, owned by the 19 Northern States.
Besides boosting the ailing economy, Mr. Ali-Gombe explained that when operational, the firm would essentially go into production of military and paramilitary garments.
Mr. Ali-Gombe, who is also the Chairman, Restructuring Committee of the KTL, said “we cannot say tentatively when this will take off. We are hoping very soon.
The Kaduna Textile Limited, established in 1957, operated a large integrated textile mill, producing various kinds of garments.
The company, currently in a state of comatose, started operation in November 1957, spinning the country’s cotton and later in January 1958, went into full production of unbleached grey bafts.
In 1961, it began the production of finished garments.
The firm was financed by the Northern Nigeria regional Marketing Board and the region’s development corporation and was managed by an expatriate firm, David Whitehead & Sons.
Textile products are likely to become more expensive, with the government fixing a higher rate on them under the Goods and Services Tax (GST), than the rates at which they are currently taxed.
A section of industry is saying that differential treatment for cotton and synthetic fibre on GST rate is an opportunity lost for a uniform rate for textile sector.
With the Chinese economy dwindling further, export potential for synthetic yarn in the Indian industry has fallen sharply again. China, which imports synthetic yarn from India to convert it into fabric and garment, has seen production being cut drastically.
"The recent market crash in China has a lot to do with bleak outlook of domestic production in almost all sectors, including textiles. Units in China have been cutting down on production due to decline in the world's buying capacity for textiles. This has resulted in synthetic yarn exports, especially that of texturised yarn, falling steeply," said Jayesh Pathak of Bombay Yarn Traders Association.
So much so, that analysts and industry experts have predicted a negative outlook for the synthetic textile sector for FY 2015-16, which had been impacted in the recent past due to decline in the Chinese demand. However, apart from China, the sector could also see an impact from lower export competitiveness of Indian synthetic yarn due to continued import and central excise duty continue on man-made fibres. According to a recent report by India Ratings & Research, a Fitch Group company, the industry also estimates price of polyester fibres to decline due to oversupply of cotton and cotton yarn over FY'16, coupled with lower crude prices.
Revising its outlook for the synthetic textile sector to negative for FY'16, the report stated, "Unfavourable cotton-polyester staple fibre (PSF) spreads have hurt domestic synthetic yarn demand. Lower export competitiveness of Indian synthetic yarn also contributes to the subdued outlook as import and central excise duty continue on man-made fibres."
According to industry sources, global demand for synthetic yarn in recent times has fallen by 60 per cent. "China had already begun reducing its import from India. But the scenario has aggravated to such an extent that Indian synthetic units have cut production by almost 40 per cent," Pathak added.
However, as a counter view, OP Lohia, chairman of Indo Rama Synthetics (India) Limited, stated that given the synthetic yarn's competition to cotton, the latter's loss could result in the former's gain in near future. "We can only improve from here since we have already hit the rock bottom. There may be an immediate impact of China's economic decline on the synthetic textiles industry in India but in the long run, we will grow on the back of reduced competitiveness of cotton," Lohia said.
According to Lohia, the synthetic yarn's competitiveness against cotton is improving day-by-day since cotton prices have been rising and are expected to rise further in near future. "As compared to that, synthetic yarn prices have fallen by 30 per cent in the last one year," Lohia added.
Prices of major raw materials like purified terephthalic acid (PTA) and mono-ethylene glycol (MEG) have also touched multi-year lows on account of lower crude prices, with PTA falling 19 per cent q-o-q to $ 628 per MT and MEG falling 5 per cent q-o-q to $ 783 per MT in the quarter ended March 2015, the India Ratings & Research report stated.
Sharekhan has buy call on Greaves Cotton with a target price of Rs 190.
The current market price of Greaves Cotton is Rs 154.2.
Time period given by analyst is a year when Greaves Cotton price can reach defined target.
Greaves Cotton, incorporated in the year 1922, is a Mid Cap company (having a market cap of Rs 3,831.60 crore) operating in Engineering sector.
Greaves Cotton key Products/Revenue Segments include Engines which contributed Rs 1,697.15 crore to Sales Value (93.29 per cent of Total Sales), Traded Goods which contributed Rs 115.90 crore to Sales Value (6.37 per cent of Total Sales), Export Incentives which contributed Rs 2.78 crore to Sales Value (0.15 per cent of Total Sales), Service Income which contributed Rs 2.73 crore to Sales Value (0.15 per cent of Total Sales), Royalty Income which contributed Rs .32 crore to Sales Value (0.01 per cent of Total Sales), Other Operating Revenue which contributed Rs .21 crore to Sales Value (0.01 per cent of Total Sales)for the year ending 31-Mar-2017.
For the quarter ended 30-06-2017, the company has reported a Standalone sales of Rs 453.86 crore, up 16.16 per cent from last quarter Sales of Rs 390.73 crore and up 13.59 per cent from last year same quarter Sales of Rs 399.55 crore.
Company has reported net profit after tax of Rs 41.17 crore in latest quarter. The company's top management includes Mr.Arvind Kumar Singhal, Mr.Karan Thapar, Mr.Kewal Handa, Mr.Nagesh Basavanhalli, Mr.Navneet Singh, Mr.Vijay Rai, Mr.Vikram Tandon, Mr.Vinay Sanghi, Ms.Sree Patel. Company has Deloitte Haskins & Sells LLP as its auditors. As on 31-03-2017, the company has a total of 244,206,795 shares outstanding.
- Turkey imposes temporary duty on Vietnam yarn
19 Aug 2017
- Hope rises for Kaduna textile over planned $15 million investment
14 Aug 2017
- Higher GST to make textiles costlier, industry laments lack of uniformity
11 Aug 2017
- Indian synthetic yarn industry reels under Chinese gloom
09 Aug 2017
- Buy Greaves Cotton target Rs 190: Sharekhan
09 Aug 2017