YARNEX/ TEXINDIA SHOW 2014- NEWSLETTER

www.textilevaluechain.com

COMPLEMENTARY NEWSLETTER

Southern India is the major hub for textile and apparel manufacturing industry. Southern India, Being a Leader in Spinning & Weaving manufacturing Industry due to conducive environment, Government support, the region is also well known for manufacturing of apparel both knitted and woven.

S.S. Textile Media Pvt. Ltd. Consecutively organizing various show in southern market. In Banglore: F&A , Homtex show . In Tirupur : Yarnex & Texindia Yarnex has emerged as a unique one-stop event for trade visitors from India and overseas. Exhibitors at the show comprise of Fibres, Yarns and related Services. Visitors to the show are serious decision makers from focused segments like Buying Houses, Buying Agents, Composite Mills, Garment Manufacturers, Powerloom Weavers, Knitters, Domestic Brand Manufacturers, Fashion labels, Fashion Designers, Wholesalers/Distributors and Importers.

Endorsement by trade & Industry show is supported by leading trade associations like the Tirupur Exporters Association (TEA), Knit Cloth Manufacturers Association, Tirupur Industrial Federation and Tirupur Exporters and Manufacturers

The 6th Edition of Yarnex — Dates : 9th to 11th September, 2014 — Venue : India Knitfair Complex, Tirupur (GROUND FLOOR) — Exhibitors Profile : Manufacturer of Fibers, Yarns & Services

Association, India Knit Fair Association.

Media like TEXTILE VALUE CHAIN and Attire world and few online media supported the show.

Business Networking Forum (BNF) a series of seminars that disseminate information on various aspects of the textile industry, has now become an integral part of the event and is keenly looked forward to by the textile value chain. BNF will be held on 10th September 2014 at 6.00 pm at IKF Complex, Tirupur. Our endeavour is to position the BNF as a platform for the entire textile value chain - right from fibres to fashion.

The topic of the panel discussion will be - “Going beyond cotton … towards value added opportunities” Moderator: Mr. V Raja Mahendran - Managing Director, Unisource Trend India, Coimbatore The speakers at the panel discussion include: Ÿ Mr. Sanjay Gupta, Head Market Development for the Recron® Staple Fibre Business, Reliance Industries Limited Ÿ Dr. K. Rajendrakumar, Director, Knitwear Technology Mission, Tirupur Ÿ Mr. Elangovan, Chairman & Managing Director, S.N.Q.S. International, Tirupur Ÿ Mr. D Subaash Kumar, Vice President, Anugraha Fashion, Tirupur

Business Networking Forum The 3rd Edition Texindia – Dates : 9th to 11th September, 2014 – Dates : 10th September, 2014 – Venue : India Knitfair Complex, – Venue : India Knitfair Complex, Tirupur (FIRST FLOOR) Tirupur (SEMINAR HALL) – Exhibitors Profile : Manufacturer of Apparel Fabrics, trimmings, Embellishment

Shri Muniveer Spinning Mills has set up a new modernized spinning unit with state-of-the-art machinery and infrastructure. Our quality is a promise wherein we strive only for excellence. Our valued customers perceive us as a producer of consistent quality at competitive prices, always striving to exceed their expectations.

Product Range: 100% PSF Spun Polyester Yarns - Ne 30/1, Ne 40/1, Ne 50/1, Ne 60/1 A-1/11 Hojiwala Industrial Estate Road No. 9, Sachin Udhyognagar, Vanz Surat – 394230, Gujarat - India .

Office: +91-261-2391200 , Email: smspinning@gmail.com, www.smspinning.com

Loknayak Jayprakash Narayan Shetkari Sahakari Soot Girni Ltd. Aims to Deliver Productivity & Quality for Superior Investment in Social Growth

Product Range Ÿ

Supplier of % Cotton Yarn in counts Range No. 12s to 40s Combed / Carded, Weaving / Hosiery.

Ÿ

Specialized in Terry towel yarn, Hosiery Yarn, “S” Twist Yarn, Multiply Yarn, Low twist Yarn, Organic cotton Yarn.

Ÿ

All type of spinning Waste, direct export of comber Nail.

Ÿ

Government of India recognized “STAR EXPORT HOUSE”.

Ÿ

Bronze Medal for “Third highest Export” in Yarn by “TEXPORCIL” for category below 50sNE.

Ÿ

Top No. 1 Ranking in best “Techno-commercial” performance in 29th CPQ study Conducated by SITRA

Kamalnagar, Untawad – Hol, Tal. Shahada, Dist. – Nandurbar, Maharashtra – India, Pin Code : 425409 Phone : 02565 0229996, 0229997, Fax : 02565 229995 E_mail : lokgirni@sancharnet.in

Advt.

Achievements :

Spinning Sector - Engine of Textile Industry Textile industry of the country continues to play a vital role in the economy of the country since pre-historic times. The country has strong multi-fibre raw material base and its presence can be felt across the length and breadth of the country. The industry is the largest employment provider next to agriculture. Though the industry has been closely monitored under various controls for a long time since the British Regime, the industry has emerged as a significant player in the global textile trade. Thanks to the government’s support to overcome the hurdles that emanate from time to time.

Foreseeing, wide opportunities with the Agreement on Textile & Clothing coming to end on January 1, 2005, government launched the Technology Upgradation Fund Scheme on April 1, 1999 and encouraged the industry to go in for modernization and expansion. Though the industry was badly affected, it survived the ill effects of recent global economic recession and registered positive growth from the recent past. The country has earned a good reputation of supplier consistent good quality yarns in the global yarn market and also occupied a significant position in garments exports. The following figure shows the growth in yarn production capacity. CAGR during the period works out to 4.8 per cent.

Indian Textile Industry predominantly uses cotton as its raw material. The country has emerged as the second largest producer of cotton in 2006-07 surpassing the production of the US and continues to hold the position till 2013-14. Thanks to the Technology Mission on Cotton and faster adoption of Bt cotton cultivation. Currently, the country accounts for 36 per cent of the global area under cotton. The country having the next highest area with 13 per cent area is China. With China reducing area under the crop, India has been anticipated to be the largest producer of cotton in 2014-15 season. However, the country’s yield of 518 kgs per hectare is well below the world’s highest yield of 1,514 kgs per hectare in Brazil. The country’s cotton production increased to 390 lakh bales in 2013-14 season from 156 lakh bales in 1999-2000 season and in the coming season 2014-15 production is anticipated at 400 lakh bales.

All yarn production in 2013-14 reached a new high of 5309 million kgs, nine per cent higher than previous year production of 4867 million kgs. Cotton yarn contributed to 74 per cent of yarn production in the country. The following figure shows growth in yarn production from 2000-01.

It may be observed that the rate of growth in cotton yarn production is the highest among various types of yarn. With increased production, the spinning sector has to compulsorily export about one-third of its production for running its machinery at the optimum level to achieve break-even. Restrictions on cotton yarn exports were relaxed in stages and registration of cotton yarn export contracts reached a new high of 1415 million kgs in 2013-14. However, registrations during the first quarter of 2014-15 have declined because of China’s policy on downsizing its buffer stock of cotton and encouraging the user of domestic cotton. However, with increased domestic demand and venturing into new markets would help to export more in the coming months. The following table shows export registrations for cotton yarn from 2010-11.

Registrations of Cotton Yarn Export Contracts - Million Kgs

Currently, Indian textiles and clothing industry is the second largest employment provider of the country providing direct and indirect jobs to over 105 million people (21% of the employment), accounting 12% of the industrial production, 4% of the GDP, 4.5% share in global textiles and clothing trade share, etc., apart from meeting the growing textiles and clothing needs of the country.

The industry has the potential to reach 220 Bn USD including 80 Bn USD export size and create 20 million new jobs by 2020 from the present sise of 77 Bn USD including exports of 33 Bn USD. The Southern India Mills’ Association (SIMA), the largest employer organization in the Indian textile sector is helping by organising exhibitions and brings all the stake holders of the industry together at regular intervals and provide a common platform aimed at creating a win-win situation. In this regard, now SIMA has organised the nineth edition of Texfair during January 912, 2015 at CODISSIA Trade Fair Complex in Coimbatore. This fair would bring together machinery manufacturers and suppliers of machinery / spares and other service providers. At the same venue, the second edition of Farm to Finish Expo has been organised on the same dates to bring together the players right from cotton seed manufacturers to technical textile manufactures and retailers. This will help them to know one another’s needs and improve business tie-ups.

With the country coming out of sub-5 per cent growth, and gaining momentum, future looks promising. The country would position itself as a leading player in the global market.

For more information Contact : Vidya Vadgaonkar Email: Vidya@ynfx.com Tel: +91 22 66291122 Mobile: +91 9619 293725

YNFX MONTHLY PRICEWATCH REPORT – SEPTEMBER 2014

CRUDE OIL Crude oil prices posted their second straight monthly losses despite frequently emerging Ukraine crisis which of late may trigger more sanctions. Strong economic data from US also could not influence the oil markets during August. Opening the month, oil markets gyrated w i t h t h e developments in the Middle East and the movement in sto c k m a r ket s , p u tt i n g f u r t h e r pressure on prices.

OPEC's report showed modest increase in July output and a downward revision in demand in 2014.

OPEC, which supplies a third of the world's oil, raised its output in August from July, with higher supply from Libya, Angola and Iran. Brent crude averaged US$101.92 a barrel for August, down 5 per cent on the month while US crude averaged US$95.99 a barrel, down 6.3 per cent and the level last seen in November 2013. The gloomy outlook for naphtha persisted in August as traders saw little upside in the market.

Earlier in the month, spot differentials of naphtha cargoes for delivery into North Asia tumbled to their lowest in 10 months as the region continued to grapple with an oversupply amid limited spot demand. On the month, naphtha prices were down 5.4 per cent averaging US$904 a ton CFR Japan.

POLYESTER CHAIN Ethylene prices were mixed in Asia in August due to poor demand and negative derivatives margins.

While prices sobered in NE, they inched up SE averaging US$1,539-1,541 a ton and US$1,489-1,491 a ton, respectively.

Europe ethylene hit a low since June 2012 tracing the plunge in naphtha while demand slumped. Prices were down 3.7 per cent averaging Euro994-998 a ton FD NWE. US spot ethylene first dropped only to recover sharply in the last two weeks touching a 28-month high on tight supply and short covering, posting 7 per cent jump to average US cents 67.20-67.70 per pound FD USG. Paraxylene prices kept falling week on week in Asian markets following a surge opening the month as several new units outside China were started up in succession. Upstream mixed xylenes prices also fell amid weak buying interest in Taiwan and South Korea. Meanwhile, European and US markets tracked Asian movement. Asian marker, FOB Korea was down 3 per cent averaging US$1,337-1,338 a ton. European spot was up 5 per cent at US$1,245 a ton FOB ARA while US spot closed the month at US$1,250 a ton FOB USG, down 10 per cent on the month.

MEG prices rose as inventories declined in China in the first week but sobered due to weak buying sentiment later in the month. MEGlobal nominated its September Asia contract price up from August. In Europe, an initial August contract price was settled at a rollover while spot prices remained stable on divided discussions, partly due to the seasonal lull.

US MEG prices were down due to low demand, even in a tight market.

Asian MEG markers averaged US$994-999 a ton a ton CFR China and US$996-998 a ton CFR Southeast Asia. PTA prices in Asia rose on bullish upstream paraxylene as producers adopted paraxylene-linked formula

to settle prices. Spot prices kept rising although paraxylene softened pushing PTA margins into a positive territory for the first time in a year.

In US, formula-derived August US PTA price was down. Asian PTA markers rose to US$1,002-1,007 a ton CFR China and US$1,017 a ton FOB Korea. Polyester chip markets were range bound in weakness in August. In China, offers for semi dull chips fell to US$1,475-1,485 a ton, down 2 per cent from July average. Super bright chip prices also fell to US$1,475-1,490 a ton.

Polyester filament yarn prices were seen rising in China while they rolled over in markets. The markets fluctuated on weaker raw material cost but downstream buyers were cautious with limited interest. FDY sellers raised offers slightly only to find deals done in small volumes, and inventory rose a bit. DTY makers showed limited buying interest due to sluggish demand. In India, POY market was steady and producers’ offers rolled over anticipating stable future sentiment. In Pakistan, DTY markets were stable amid stalemated sentiment and quiet trading activity. Polyester staple fibre markets were caught between strong upstream cost and sluggish downstream demand while producers tried to gain bargaining power by cutting production. In China, the market was on the rise before stabilizing this month. Later in the month, prices were in weak correction under pressure of poor demand and falling raw material cost. In China, POY 75/72 was traded at average of US$1.64-1.65 a kg in Shengze market, down US cents 9.

Indian POY 130/34 prices were stable at US$1.95 a kg. 1.4D PSF in China were at US$1.57-1.58 a kg, down US cents 4. Indian PSF prices were steady at INR104 per kg.

NYLON CHAIN Rapidly softening of demand for benzene in the US had a similar influence on other m a r ke t s p u s h i n g prices further down in Asian markets. In US, spot benzene prices declined as supply lengthened amid weak demand a n d a l s o ra i s i n g ex p e c ta t i o n t h a t contract for September will settle lower. In Europe, spot benzene prices saw no reprieve with prices falling faster than any other markets.

September European contract price was also settled down. Asian benzene marker, the FOB Korea was assessed at US$1,317-1,318 a ton, down 3.4 per cent month on month. In US, spot benzene prices averaged US cents 485.20-485.30 per gallon FOB USG, down 4.3 per cent from July. European spot barges were assessed at US$1,395-1,396 a ton CIF ARA, down 4.6 per cent. Caprolactum prices headed down later in the month given the falling benzene market and weaker demand. In China, spot prices were seen edging down in anticipation of increased supply. Demand from downstream nylon chip market was range bound as run rate at polymerization units were moderate.

Demand was stable from nylon textile yarn makers. The Asian caprolactum spot prices averaged US$2,250-2,270 a ton in August, up 1 per cent from last month.

August saw the uptick in nylon chip markets generally halted by the

slight weakening of caprolactum sentiment opening the month. Nylon chip producers felt cost pressure easing and thus prices turned stable to lower. However, the downside space was limited. Besides, reduced output and low inventory at chip producers held sentiment firm, although overall supply/demand fundamentals were lackluster. Nylon chips buying was cautious in the second half the month from filament yarn markers while non-textile-yarn sectors. Cord fabric, fishing net yarn and staple fiber makers showed stable appetite for nylon chips.

Offers for Taiwan-origin chips averaged US$2,550-2,560 a ton, down US$10 over from last month. In China, bright conventional spinning nylon-6 chips were priced at US$2,935-3,080 a ton while offers for semidull chips were at US$3,050-3,135 a ton. Nylon filament yarn makers also saw lesser pressure amid falling caprolactum and nylon chip prices.

However, firm yarn prices assured maintain margins. Downstream knitting and weaving sector made small replenishment despite fresh export orders. In China, semi-dull FDY70D/24F was traded at US$3.593.65 a kg while FDY40D was pegged at US$3.90-3.98 a kg. Nylon DTY 70D/24F was traded at US$3.80-3.98 a kg.

ACRYLIC CHAIN Asian propylene prices tumbled in the first week of August on arrival of fresh supply amid rigid downstream demand. Some buyers were waiting for the price to drop further. The decline continued during the month on weak buying sentiment and easing cost support. In US, spot chemical-grade propylene also lost throughout the month despite increasing buying interest. However, prices rebounded at the end on rising contract price nomination and planned outages. European chemical-grade propylene spot prices also increased on the back demand recovering. Asian propylene marker, FOB Japan averaged US$1,314-1,316 a ton down 5 per cent from July while the FOB Korea values lost 4.5 per cent at US$1,346-1,348 a ton.

Acrylonitrile prices hit a two-year high in Asian and European markets on continued tightening of regional and global supplies. European tight supply pushed prices up, a high last seen in April 2012. In US, acrylonitrile domestic prices rose to a nearly four-month high on higher feedstock contract prices for August. Asian acrylonitrile was assessed up 4 per cent on the month to average US$2,052-2,054 a ton CFR Far East Asia. European prices increased 5 per cent to US$2,013-2,017 a ton CIF Mediterranean.

Acrylic staple fibre markets saw buoyant sentiment as the month drew to a close and feedstock acrylonitrile prices consolidated at high levels.

In China, some producers raised offers as trading atmosphere in downstream acrylic yarn market was moderate. Demand for worsted yarn was passable. Spinners reportedly had limited inventory and kept procuring on need basis due to lackluster demand from terminal sectors. Acrylic fibre prices headed up in the last week of August on cost support and producers in China successively issuing settlements for August with numbers up from the list prices. Prices in India and Pakistan rolled over. Japan-origin flat fibers were quoted at US$4.00 per kg, while trading prices for firm deals were negotiable. Taiwan's Tong-Hwa released its list prices for September, up by US cents 4 per kg from last month with 3D bright tow hiked to US$2.70 a kg and 3D anti-pilling fiber tow to US$2.76 a kg. In China, cotton-type staple fiber was offered at US$2.90-3.00 a kg, up US cents 5 from last month. In Pakistan, 1.2D ASF price was steady at US$3.04 a kg while Indian ASF prices was at US$2.94-2.99 a kg, up US cents 6 from July.

VISCOSE CHAIN Viscose staple fibre markets were on a flat note in August despite several producers in China pulling prices up to spot level after offloading goods at low prices earlier. However, the price hike was not acceptable to buyers and thus, the markets witnessed failure of price uptick. A conference held in China in the last week concluded with producers broadly hiking prices, only to encounter strong resistance. Prices in India and Pakistan rolled over previous month’s numbers. In China,

offers for medium goods were at US$1.93-1.95 a kg and high-end at US$2.00 a kg. In Pakistan, 1.5D VSF was at US$2.06 a kg, down due to weaker c u r re n c y. I n d i a n prices were stable at US$2.27-2.39 a kg.

Viscose filament yarn markets extended the previous month’s stable run as downstream buyers were reluctant to replenish beyond the hand-to mouth volumes.

Meanwhile, producers moved volume at a steady pace, with some adjusting production somewhat. In India, prices rolled over on support of high cost. Offers for the first-class VFY 120D in China were at US$6.006.25 a kg, same as in last month. In India, 100D bright VFY was pegged at US$6.65-6.68 a kg rolling over from July.

COTTON Cotton prices failed to fully recover from the falls seen in the last week of August.

Prices were still low across markets by about 8-9 per cent from July levels. US Cotton futures, although inched up slowly throughout the month, they were under pressure of expected large supply as it rained in dry and hot regions of US cotton regions. The benchmark December cotton contract on ICE Futures US closed the month at US cents 66.57 per pound, down 3 per cent from July. Cotlook A index lost 8.6 per cent, averaging US cents 74.43 per pound while China Cotton Index 1 per cent to average 17,060 Yuan a ton. Slight rains in Sindh and Punjab region of Pakistan in the last week caused temporary halt of seed cotton arrivals on the market. Rains are good for the standing crop, and this gave impression that cotton harvest may improve in coming month. The Karachi Cotton Association’s official spot rate averaged PakRs5,587 per maund ex-Karachi in August down 9 per cent on the month. In India, raw cotton gained on short availability of quality product while most cotton varieties price remained unchanged or slightly moved down on limited buying. Prices were down 1-3 per cent on the month.

SPUN YARN Cotton yarn markets were largely stable in August as producers were eager to offload inventory by offering h i g h e r d i s co u nt s .

Tra d i n g a c t i v i t i e s were more active somewhere, though demand for high-end combed yarn remained lackluster.

Prices for rotor-spun yarn marginally fell. By month end, cotton yarn markets saw some price lowering to offload inventories. Trading activities were mute, but buying interest was seen soaring although volumes increased slightly. In India, cotton yarn producers faced tough time as exports dropped considerably while yarn prices dipped 15 per cent over the month. Demand from China has slowed down while domestic demand too is low currently. However, resurge in demand of yarn from China has boosted textile exports from Pakistan, giving a sigh of relief to exporters from the waning global demand during the past one year. In China, prices for OE10s and OE12s yarn were heard at US$2.85 a kg and US$2.97 a kg; with OE16s yarn at US$3.11 a kg in Guangdong market. In Shandong, 32s and 40s high-quality yarn was offered at US$4.14 a kg and US$4.30 a kg, respectively. India, 30/1 yarn

were traded at US$3.33 a kg and the same in Pakistan was at US$3.28 a kg.

Spun polyester yarn markets recovered a bit in the last week of August in Guangdong but were still poor in Jiangsu and Zhejiang. Overall, prices were mostly stable with limited changes in trading volume. Yarn makers were mostly running at lower capacity to support prices and lower recently built inventory. In Pakistan, trading activities improved on the domestic yarn markets after fabric producers received fresh export orders while polyester yarn prices remained at current levels after polyester fibre prices stabilized. In China, 32s spun polyester yarn was at US$2.16-2.17 a kg, down US cents 2 from last month. In India, polyester yarn 20/1 prices were at US$2.57 a kg and 30/1 at US$2.67 a kg. In Pakistan, 30s spun polyester was traded at US$2.56 a kg, down US cents 5 over the month. Spun rayon yarn markets were mildly buoyant in August as inventory at some mills decreased, but the impact was limited. In Fujian, prices for siro-spun yarn 40s were at US$2.85-2.89 a kg, unchanged from last month. In India, 30s viscose spun was at US$3.50 a kg and 40s at US$3.67 a kg, both unchanged. In Pakistan, 30s viscose yarn was pegged at US$3.55 a kg.

Although the dull season apparently came to an end, demand for yarn remained sluggish on the month. Spinning mills were managing to

maintain prices stable, though buyers showed mute interest citing a wait-and-see stance as the new cotton policies was to be announced in China. In India too, spinners had troubles to reverse the poor margins, and players were mainly held a wait-and-see stance. In Pakistan, after falling sharply, cotton prices were below polyester levels depressing use of polyester in blended yarn production. Earlier in the month, blended yarn prices fell slower compared to pure cotton yarn since cotton prices fell on the international market and demand from China weakened rapidly. In contrast, polyester fiber prices increased, supporting polyester blended yarn markets, although they have not followed the same upward trend. In China, PC yarn (65/35) OE16s and OE21s yarn were traded at US$2.19 a kg and US$2.60 a kg, respectively in Jiangsu market. In India, combed PC yarns 30/1 were traded at US$3.00 a kg and 30/2 at US$3.17 a kg. In Pakistan, PC (65/35) 20s was at US$2.87 a kg in Faisalabad market while 30s was at US$3.22 a kg, both down US cents 56 from last month.