Mumbai : ‘E-Textile’ system has been developed to boost textile industry. Chief Minister Eknath Shinde unveiled the ‘ETextile’ system at Sahyadri Guest House. Textiles Minister Chandrakant Patil, Chief Secretary Sujata Saunik, Secretary of Textiles Department, Virendra Singh and concerned officials were present on this occasion. On this occasion, Chief Minister Shri Shinde said that a new integrated and sustainable textile industry policy of the state has been announced. Under this, small textile industry should be promoted and maximum employment should be generated through this policy, the Chief Ministerinstructed. This system has been newly designed for end to end process automation for various schemes of the textile department. In his presentation, Secretary of the Textiles Department, Mr. Singh said that ‘E-Textile’ system has been developed through ICICI Bank to make information about all the schemes of the textiles department available at one place for easy and convenient business and to make it more accessible. Shrikrishna Pawar, deputy secretary of textiles department, officials of ICICI Bank and concerned officials were present on this occasion.
Source: Pune News
The spinning and weaving industries of India’s nylon sector are at odds and have presented conflicting demands to the government. The Nylon Spinners Association (NSA) has called for the mandatory implementation of the Quality Control Order (QCO), an increase in the basic customs duty to 10 per cent or the imposition of an anti-dumping duty and placing nylon yarn in the restricted category. They argue that the industry's poor condition is due to the large supply of imported nylon. Conversely, the weaving and knitting industries oppose these demands, stating that several varieties of nylon yarn are either not produced domestically or suffer from quality issues. They have also accused the NSA of attempting to monopolise the market and exploit the situation by limiting imported supplies. In a letter addressed to Union Textile Minister Giriraj Singh and other ministry officials, the NSA stated that the domestic nylon industry is suffering significant losses due to the influx of cheaper Chinese supplies that have captured the local market. The domestic production capacity for nylon yarn exceeds consumption, and production levels are sufficient to meet the country's demand. Over the past six years, the industry's capacity has increased by 15 per cent annually due to regular new investments. The NSA cited trade data, noting that before the removal of the anti-dumping duty on nylon filament yarn, Chinese supply accounted for just 1 per cent of the market, but this figure has surged to over 85 per cent in the past six years. Chinese imports have increased more than 80-fold in the past seven years till 2023. The NSA has claimed that China is dumping additional quantities of low-quality, substandard nylon yarn at cheaper prices in the Indian market. As a result, they believe it is urgent to implement corrective measures such as the QCO, anti-dumping duty, or a 10 per cent basic customs duty, as well as to restrict imports, to protect the domestic industry from further losses and potential closures. Two companies have already shut down due to unviability. Currently, upstream products, including nylon filament yarn and nylon industrial yarn, attract a 5 per cent basic customs duty, while nylon fabric and tyre cord fabrics are subject to a 20 per cent duty. On the other hand, the weaving industry has expressed differing viewpoints in response to the ministry’s request for feedback from the downstream industry regarding the NSA's demands. Gujarat’s Surat-based cooperative body, Pandesara Weavers Cooperative Society Limited, stated in a letter to the Minister Singh and other ministry officials, “Indian producers do not produce several varieties including 300/10 Round mother yarn, 250/10 round Bright mother yarn which are widely used in warp knitting sector. If these yarns are produced in limited quantity, its quality is very inferior. Fabric manufacturers are bound to face losses due to rejection of finished goods. Buyers reject consignments complaining variations in dyeing and other defects. Domestic manufacturers failed to solve the issue and abandoned their plans. They also import around 28 per cent yarn from China and supply at a premium in the local market.” The cooperative body of weavers further claimed that domestic yarn supply does not meet international standards of quality. It alleged that the NSA’s primary aim is to form a cartel to raise nylon yarn prices, similar to what occurred in the polyester segment following the implementation of the QCO. As a result, members of the weaving and knitting industries are strongly opposed to the NSA’s demands. They have requested that these demands be rejected, as they would restrict competition and limit access to raw materials preferred by weavers and knitters. Now, the final decision rests with the ministry, which must navigate these conflicting demands and arguments from the entire textile value chain.
Source: Fibre2fashion
The Federation of Indian Export Organisations (FIEO) has urged the government to extend interest equalisation scheme or subsidy on loan for exports, which is slated to come to an end on September 30 after multiple extensions, by another 5 years in order to provide support to exporters who are struggling due to ongoing geo-political conflicts and subdued global demands. Talking to reporters on the sidelines of an event FIEO Director General Ajay Sahai said some Indian exporters may not be able to service their overseas shipment demands if interest subsidies are not provided. “If there is no interest equalisation scheme, then we will lose some markets and some orders,” he said. Sahai said the export body has requested the government for extension of the scheme. “The scheme will end on September 30. We have requested for it to be extended for five years,” he added. The interest equalisation scheme was introduced in April 2015, initially for five years. However, it has been extended multiple times. With effect from April 1, 2015 interest equalisation at 3% for labour intensive / MSME sectors was introduced. The rate was increased to 5% for MSME sectors with effect from November 2, 2018 and merchant exporters were covered under the scheme with effect from January 2, 2019. Scheme seeks to remove cost disability of Indian exports because of higher credit cost. At present, the bank rate in India is 6.5% whereas in Japan (0.10%), China (3.45%), South Korea (3.5%), and Singapore (3.42%). Credit cost in India is generally 5-6% higher when compared with the other major exporting countries. FIEO President Ashwani Kumar said another major challenge facing the Indian exporters is increased transportation cost due to the ongoing disruptions in the Red Sea. Meanwhile, FIEO signed an agreement with trade financing firm Stenn for supporting small and medium-sized businesses engaged in international trade. “Our collaboration with FIEO represents a strong commitment to helping Indian exporters expand their global presence,” said Noel Hillman, Chief Commercial Officer of Stenn. “By providing flexible financing solutions and mitigating payment risks, we empower businesses to scale rapidly and compete effectively with larger players,” he added.
Source: Economic Times
In a recent interview, Commerce and Industry Minister Mr. Piyush Goyal highlighted the significant achievements of the Make in India initiative over the past decade, emphasizing India's recognition as a top global manufacturing destination. He noted the initiative's success in creating jobs, attracting substantial domestic and international investments, and fostering self-reliance in various sectors. The government has implemented numerous measures to enhance the ease of doing business, promote high-quality production, and strengthen economic fundamentals, contributing to a 90% growth in the Indian economy compared to 35% globally. Goyal expressed satisfaction with the Production-Linked Incentive (PLI) scheme, citing notable successes in sectors like white goods and mobile manufacturing, where domestic value addition has surged. He acknowledged that while some sectors face longer gestation periods, overall progress is encouraging. The government actively monitors PLI sector companies and addresses teething issues, ensuring stakeholders are engaged and supported. Looking ahead, Goyal affirmed a commitment to further reducing compliance burdens and fostering a conducive environment for increased manufacturing and job creation in India.
Source: IBEF
The action plan team set up under the Supply Chain agreement of the Indo-Pacific Economic Framework for Prosperity (IPEF) needs to address global concentration of supply chains in critical minerals, agro-chemicals, pharmaceuticals and medical devices, commerce and industry minister Piyush Goyal said Tuesday. “The use of specific minerals is indispensable for the sectors including clean energy, electronics, defence, transportation, telecommunications, fertilisers, and pharmaceuticals. One of the key challenges in supply chains is risk on account of concentration of global capacities or resources, which can add to price volatility and supply uncertainty,” the minister said at the ministerial meeting of the IPEF. The ministerial meeting focussed on IPEF Pillar II (supply chains), III (clean economy), and IV (Fair Economy). Action plan teams were formed in the first in-person meeting of the supply chain council held in Washington last week for three critical sectors – semiconductors, critical minerals with a focus on batteries, and chemicals. “Healthcare including pharmaceuticals and medical devices is an extremely relevant area due to over concentration of global production of APIs and Key Starting Materials (KSMs) which can severely impair supply chain resilience and impact our capacity to address the healthcare needs of our economies,” he said. The growing population puts immense pressure on limited agricultural land for higher yields and in this context, the importance of resilient supply chains for Agro-chemicals has become extremely important. According to an estimate, the Global Agrochemicals Market (fertilisers, pesticides, adjuvants, and plant regulators) is projected to reach $ 282.2 billion by 2028 from $ 235.2 billion by 2023, at a CAGR of 3.7%. India signed Pillar III and Pillar IV of IPEF on Sunday. It was already part of Pillar II of IPEF that deals with supply chain. The supply chain agreement entered into force in February. India, however, has decided not to join the Pillar I of the framework that deals with trade. India has opted for observer status in the trade talks. IPEF was launched in 2022 in Tokyo. It has 14 countries – Australia, Brunei, Fiji, India, Indonesia, Japan, Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, Vietnam and USA – as members. The IPEF partners represent 40 percent of world GDP and 28 percent of global goods and services trade.
Source: Financial Express
Myanmar and India are scouting ways to boost bilateral trade through their local currencies. Indian commerce and industry minister Piyush Goyal discussed this with Myanmar's minister of investment and foreign economic relations Kan Zaw on the sidelines of the 12th East Asia Summit Economic Ministers' Meeting in Vientiane, Laos. Both discussed potential cooperation areas in trade and the ongoing ASEAN-India Trade in Goods Agreement (AITIGA) review negotiations. The local currency trading mechanism is expected to reduce transaction costs by eliminating the need for dual currency conversion. At the meeting, Goyal reiterated India’s commitment to strengthen the East Asia Summit Forum and acknowledged its role in promoting peace, stability and economic prosperity in the region, a release from Indian ministry of commerce and industry said. While the global economy is expected to grow at 3.2 per cent in fiscal 2024-25, India’s growth rate is projected at 7-7.2 per cent, with India on the way to become the 3rd largest economy by 2027, he said. He urged ASEAN countries to come forward for collaboration on issues of global south at the World Trade Organisation (WTO) and to strengthen multilateralism. Goyal also met Inkyo Cheong, South Korean minister for trade, industry and energy and discussed bilateral trade relations, progress in negotiations for upgrading India-Korea Comprehensive Economic Partnership Agreement and promoting inclusive investments in India.
Source: Fibre2fashion
When PM Narendra Modi met President Joe Biden at the latter’s personal lake house in Wilmington on Saturday, Modi told Biden, according to foreign secretary Vikram Misri, that he had opened the doors of his home after having opened his heart to India. It was a special moment, a farewell of sorts, and Modi profusely thanked Biden. But it wasn’t just Biden who had opened his heart and doors. Modi, too, had come all the way, at the very end of Biden’s term, to the President’s hometown, when the political returns from such a visit are limited, and swapped the opportunity to host the Quad summit with the US because Biden had made a request. The reason why Modi had done this was because Biden — notwithstanding the ways in which parts of Indian social media mock the 81-year-old veteran for his increasingly visible age-related deficits — has been a transformative president for India-US ties, the most transformative since George W Bush invested his political capital to push through the civil nuclear deal. Modi’s own base has trouble understanding this at times, but India’s top political and bureaucratic leadership is aware of the reality. Biden understood India’s real dream of becoming an industrial and military manufacturing power. And he opened not just his heart and home, but the doors of the closed US national security and technology establishment (partly, not wholly, of course) to help India and Modi meet this dream. This largely happened under the framework of the initiative on critical and emerging technology (iCET), a framework driven by Biden’s closest aide and NSA Jake Sullivan and Modi’s closest aide and NSA Ajit Doval, whose absence during the visit was conspicuous. But go back a little to the beginning of Biden’s term. Dispelling any doubts about the new administration’s commitment to the Indo-Pacific, an adversarial approach to China, and attitude to India, Biden elevated the Quad to the level of leaders within two months of taking oath. During the second wave of the pandemic that devastated India, the US was a bit late in responding but respond it did with resources and inputs to save lives and help India overcome the challenge. In September 2021, Biden hosted Modi in the White House with an in-person Quad summit that laid out a radically ambitious agenda, especially on emerging technologies. But the real game-changer was in the summer of 2022 when Biden and Modi decided to get their national security secretariats to begin working on iCET, which then was formally launched in January 2023. Here was the fundamental hypothesis behind the framework. India recognised that it needed jobs for growth and to manage social stability. Jobs required manufacturing. Manufacturing required capital. And the US remained a major source of capital. India recognised that the new frontier of geopolitical competition lay in technology and it needed the US to move from the technology-denial regime and technology-sharing ambivalence to actively supporting India’s technological aspirations. And India recognised that if it wanted to be a great power, it could not become so without developing its own military-industrial base, which, once again, required coproduction and co-development at home. India’s size, location, talent, scale, and strategic importance needed to be leveraged for this trifecta of military-industrial-tech dream. And Delhi was aware that no power since the second World War, be it in Western Europe or East Asia or China itself, had risen without the US playing this role in enabling their boom. But for his part, Biden was the one who invested the weight of the White House to develop synergies with this Indian aspiration. The pandemic had made the US and the rest of the world realise the perils of dependence on a single geography, China, and had brought home the need to diversify supply chains — India was a natural destination. The rise of new technologies had made the US realise that retaining its edge required collaboration with players such as India which brought talent, scale, data, and an entirely new perspective because of its own history to the table. And managing America’s relative decline while shaping what came next required burden-sharing militarily. But merely selling weapons the old way wasn’t going to work, and therefore there was a need to allow American capital to go and invest in India in sensitive areas and do the hard work of reshaping US’s own export control restrictions. Aided by a solid team in NSC, Biden gave the green signal for this. And he did not allow divergences over Russia, or the different ideological beliefs of Democrats and the BJP, or even controversies such as the alleged plot to assassinate a terrorist who happens to be a US national come in the way of this cooperation. Instead, he stepped in to help India when it mattered to Delhi, including during India’s G20 presidency by displaying flexibility so that the Indian presidency succeeded. This is the true bond between Biden and Modi. They understood what the other wanted to do for his country and respected it and were willing to help each other achieve that aim. And that three-fold frame of defence-tech-manufacturing is what is most visible in the bilateral factsheet that was released on Saturday. From US military supporting Indian startups to produce chips that will be used by America and its allies to Ford returning to manufacture in India; from both countries working to develop an alternative supply chain for clean energy to space collaboration; from a deeper knowledge partnership in science and technology through additional resources to shaping new regimes on AI and research on quantum; from deeper strategic collaboration through a defence industrial cooperation roadmap to getting American and Indian private sector and academia to work together in defence innovation; from collaborating in third countries through American financing for Indian private sector on infrastructure to working together on mineral security; from US recognising the power of India’s digital public infrastructure to both countries working together for the reform of multilateral development banks, the list really touches the core issues that matter most to India and America. And that is why Biden called Modi his friend and Modi went to thank Biden. History will recall the Biden presidency as a remarkable chapter in bilateral ties. Negotiations for an FTA with the EU were launched in June 2022. The eighth round During the eighth round of talks in June, discussions were held on 21 policy areas and chapters, which included carbon tax, pesticides, and services. The negotiators also discussed sticky issues such as stringent EU safety standards for agricultural commodities and drugs and high tariffs. Other key issues discussed included India's trade disputes with the World Trade Organization regarding products like mobile phones and components, integrated circuits and optical instruments. Meanwhile, when the ninth round of talks resume on Monday, both sides, India and the EU, will have discussions on a 12-point agenda, which includes deforestation, electric vehicles, sustainability, carbon tax or Carbon Border Adjustment Mechanism (CBAM), sanitary and phytosanitary (SPS) measures, technical trade barriers, textiles, in services benefits for IT professionals, trade of more goods and services, taxes on liquors, among the others, the second person mentioned above said, requesting anonymity. "India is pushing for the relaxation of the Carbon Border Adjustment Mechanism for its Micro, Small and Medium Enterprises (MSMEs) and seeks to enhance trade in electric vehicles (EVs). The upcoming talks also focus on greater access for India's services sector, tariff reductions, and strengthening investment protection," the second person added. Queries emailed to the spokespersons of the commerce ministry and the EU remained unanswered till press time. India's exports to Europe India's exports to Europe have been rising since FY21 in tandem with the global economy emerging from the pandemic. India's exports to Europe, in value terms, was $98.88 billion in FY24, up from $98.34 billion in the previous year, while imports were $95.77 billion during the same period, up from $90.99 billion in FY23. “As India and the EU continue their negotiations, reaching a comprehensive agreement holds significant promise for boosting trade and investment between the two economies. With the potential to eliminate tariffs on a wide range of goods and services, the India EU Broad based Trade and Investment Agreement (BTIA) could open up new opportunities for Indian and European businesses,” said Ajay Srivastava, a former trade services official and founder of economic think tank Global Trade Research Initiative. “However, key challenges such as sustainability regulations, labour standards, and tariff asymmetries remain. A political push and pragmatic approach will be necessary to bridge these gaps and ensure that the India-EU BTIA becomes a cornerstone of their strategic economic partnership,” he added.
Source: Live Mint
India and Korea on Saturday held discussions on upgrading the existing free trade agreement, balancing two-way commerce and promoting investments between the two countries. The issues were discussed during a meeting between Commerce and Industry Minister Piyush Goyal and his Korean counterpart Inkyo Cheong at Vientiane, Laos. "Deliberations were held on achieving more balanced trade, upgrading the India-Korea Comprehensive Economic Partnership Agreement (CEPA), promoting investments linked to job creation and addressing non-tariff barriers to further strengthen our economic ties," Goyal said in a post on social media platform X. The two countries are holding review meetings to upgrade the CEPA, which was operationalised in January 2010. So far, over 10 rounds of review talks have been held. The two countries have sought greater market access for certain products that are under the negative list of the agreement. No customs duty concessions are granted for the goods under this list. Department of Commerce had earlier engaged with different ministries, including heavy industries, steel, and chemicals, to prepare the offer list. India has sought greater market access for certain products like steel, rice, and shrimp from South Korea to boost exports of these goods. India has flagged issues over Korean firms not buying Indian steel. The review exercise assumes significance as both sides have shared the hope that the CEPA upgradation negotiations would play an important role in strengthening and deepening the economic cooperation between both countries. In general, such review or upgrade exercise includes implementation issues, rules of origin, verification process and release of consignments, customs procedures, further liberalisation of trade in goods, and sharing and exchange of trade data. India has also raised concerns about the growing trade deficit between the two countries. India's exports to Korea dipped to USD 6.41 billion in 2023-24 from USD 6.65 billion in 2022-23 and USD 8 billion in 2021-22. The imports stood at USD 21.13 billion in the last fiscal as against USD 21.22 billion in 2022-23 and USD 17.5 billion in 2021-22. According to economic think tank Global Trade Research Initiative (GTRI), India's trade deficit with South Korea increased at a much higher rate compared to its trade deficit with the world. It has also stated that Indian exporters are facing various non-tariff barriers in South Korea, including stringent standards, regulations, and certification requirements, and these barriers make it difficult for Indian goods to penetrate the South Korean market. Goyal also held a meeting with Kan Zaw, Myanmar's Minister of Investment and Foreign Economic Relations, on the sidelines of the 12th East Asia Summit Economic Ministers' Meeting. "Discussed potential cooperation in areas like lentils, diesel, gasoline, electric vehicles, etc and ways to promote bilateral trade including through Rupee-Kyat currency mechanism, between our nations," he said.
Source: Business Standard
India and south Korea on Saturday discussed addressing the issue of non-tariff barriers being faced by Indian exporters in the Korean market and other related matters to achieve more balanced trade between the two. In the meeting between commerce and industry minister Piyush Goyal and minister of trade, industry and energy of Korea Inkyo Cheong, both sides also held discussions on upgrading the existing Comprehensive Economic Partnership Agreement (CEPA). The negotiations on expanding the pact are in progress. The meeting was held at Vientiane in Laos on the sidelines of the ASEAN-India Economic Ministers’ meeting and the East Asia Summit Economic Ministers’ Meeting. CEPA between India and Korea was signed in 2009 and came into force in 2010. Since the outcome of the agreement was in Korea’s favour, the review of the agreement was agreed to in 2016. Since then, 11 rounds of talks have been held. Some Korean officials have been on record, saying that talks may finally conclude in 2024
Source: Live Mint
West Bengal is likely to get a textile cluster soon as part of the recent trade discussions held between Prime Minister Narendra Modi and US President Joe Biden where India has plans to set up 75 such textile clusters across the country to boost its export. In the recent Modi-Biden meeting, the leaders welcomed the signing of a Memorandum of Understanding (MoU) between the Ministry of Micro, Small and Medium Enterprises and Small Business Administration for promoting cooperation between U.S. and Indian small and medium-size enterprises by improving their participation in the global marketplace through capacity building workshops in areas such as trade and export finance, technology and digital trade, green economy and trade facilitation. Also Read - CM pledges houses for flood victims, Rs 2 lakh for families of 28 deceased Sources said that the decision to set up such textile clusters to boost exports also comes at a time when India is planning to strengthen its trade with the US. Experts view this as a strategy to tackle India’s trade deficit with China. Amid such a situation, India has apparently decided to find an alternative. The Union government has plans to set up textile clusters across the country and Bengal is likely to be in the top five states which will have a contribution in this aspect. Several production units are to be set up for this purpose. The Ministry of Commerce and Industry will act as the nodal agency. Sources said that India’s textile market is presently worth Rs 10 lakh crore and the target is to push it above 20 lakh crore in the next five years. The textile clusters will help establish a robust distribution and supply chain. Also Read - SC refuses to intervene in HC order on upper primary teachers’ recruitment Experts in the sector said Kolkata already has a good market in terms of textile. State government officials think that Bengal has already been taking several measures in a bid to make the state into a textile hub. Sources said the Union minister of Commerce Piyush Goyal may soon visit Bengal to hold talks with the state government. The state government reportedly released Rs 32.50 crore for the financial year 2024-25 to facilitate the smooth functioning of infrastructure projects under SIDBI Cluster Development Fund (SCDF). Some well-known clusters are textile clusters in Metiabruz and handloom clusters in Nadia and East Burdwan. To promote and increase the sale of ‘Banglar Saree’ across the state, the MSME and Textiles department encouraged opening outlets in all the district headquarters.
Source: Millennium Post
The political instability in Bangladesh has opened up immense opportunities for Indian textile companies. While these opportunities present a chance for growth, they bring in challenges that must be addressed. The textile industry needs to develop skills and gear up to tap these opportunities, said the Ramraj Cotton founder and chairman, KR Nagarajan. In a conversation with businessline, he explained India’s challenges noting that the Indian textile sector needs to focus on talent development while addressing labour shortages. “There is a significant gap in skills development in the textile industry. Tiruppur exported ₹30,000 crore worth of textiles last year, but to double that to ₹60,000 crore, we need to bridge these gaps. While automation has transformed functions like spinning, weaving, and dyeing allowing machines to handle much of the work, garment production which includes processes like designing, laying, marking, cutting, sewing, finishing, pressing, packaging, sampling, is still largely dependent on human hands,” he explained. Nagarajan added, “We currently lack the skilled workforce necessary to meet this growing demand. Many of the workers in the garment sector are migrants who do not possess the required expertise, and while some manufacturers can train them, others do not. This disparity creates a challenge in scaling up production efficiently.” He also highlighted the need for central government and state governments to significantly enhance investments in skill training to capitalise on the available opportunities fully. In comparison, countries like Bangladesh and China have made impressive strides in the global textile market by prioritising workforce development and skills training. Nagarajan pointed out that India, too, can follow a similar path to empower its workforce, tackling both unemployment and labour shortages simultaneously Ramraj Cotton, a partnership firm under ENES Textile Mills, recently launched a store in Jayanagar, Bengaluru, and plans to add around 15 more stores by March 2025. Additionally, it plans to strengthen its foothold in North, East, and West markets while simultaneously expanding its international reach. Currently, the company exports its products to Sri Lanka, Singapore, and Malaysia, and it will soon enter the UAE market. “Our focus has primarily been on building a strong presence in the local market, but we are now gearing towards becoming a pan-India brand over the next two years. After that, we will actively pursue international expansion,” Nagarajan said. With 304 stores across India, including 64 in Karnataka, the company’s manufacturing units in Tirupur, Erode, Salem, and Madurai continue to support its robust production. While the company plans to expand its manufacturing facilities, it has not confirmed any specific locations.
Source: The Hindu Business
Switzerland and China yesterday started talks to upgrade the Sino-Swiss Free Trade Agreement (FTA) and agreed to intensify consultations. Chinese commerce minister Wang Wentao and head of the Swiss federal department of economic affairs, education and research Guy Parmelin announced the launch of talks through a livestream, the Chinese commerce ministry said in a statement. Signed in July 2013 and coming into effect a year after, the FTA has played a positive role in promoting the growth of bilateral trade, and enterprises in both countries have benefitted, Wang noted. Upgrading the FTA will help expand bilateral trade and boost two-way investment and promote the upgrading of economic and trade cooperation between the two countries, he was cited as saying by a Chinese state-controlled media outlet.
Source: Fibre2fashion
China-to-US one-way container leasing rates dropped by 35 per cent from $1,221 in early August to $787 in September and container trading and leasing rates declined in the country ahead of the Golden Week, which begins on October 1, according to Container xChange's China market update for September. Average container trading prices in China decreased for the second consecutive month in September, remaining 25 per cent higher than last year’s average. Typhoon delays have led to extended berthing times of 36-60 hours in Shanghai and 24-48 hours in Ningbo, compounding the strain on key shipping routes. China experienced its worst typhoon in 75 years recently, making landfall on the east coast. Several ports in Ningbo and Shanghai have announced the suspension of container operations. Ongoing US East Coast labour strikes have led to an acceleration in shipment orders as businesses aim to sidestep potential delays, says the report by the Hamburg-based online global container trading and leasing marketplace. “In light of the recent robust US economic growth, particularly in consumer spending (expected to rise 2.4 per cent in 2024), businesses have been pulling forward shipments to mitigate potential delays. This consumer demand, coupled with a projected 3.8 per cent increase in imports in 2024, represents the significance of timely shipping from China,” said Christian Roeloffs, co-founder and chief executive officer of Container xChange, in a company release.
Golden Week traditionally causes a temporary slowdown in logistics activities across China, with a noticeable dip lasting between seven and ten days. All these events are expected to make the China-to-US shipping route volatile and uncertain over the next 20 days. Despite these uncertainties, there is no significant congestion or market tightening within China itself. Several customers have reported a drop-in container prices and lower carrier-owned container rates, suggesting a softening demand for exports from China.
Source: Fibre2fashion
