Picanol Group believes in the U.S. market

 

Meanwhile, Luc Tack, managing director of Picanol Group, Ypres, Belgium, said he and his company believe in the U.S. market for textile production and consumption. The company manufactures weaving machines sold around the world, including thousands in use in the U.S.

 

Tack noted that the U.S. population, along with much of the rest of the world, continues to grow, which will lead to increases in textile fiber consumption. And, he continued, the middle class continues to grow.

 

“In the past 10 years, 500 million people moved up to the middle class,” he said, with China, Brazil, India and Russia leading the way. “In the next 10 years, it’s projected that 500 million more people will move into the middle class.”

 

“Why is that important?” he asked. “Well, as people move into the middle class, textile consumption of apparel increases tremendously, to 180 pieces of apparel each. And it doesn’t stop there. Rich people have 470 pieces of apparel. And it doesn’t stop there. They also have better houses. And houses are full of textiles. I think this is a big opportunity for textiles. There is always a need for our products. And it doesn’t stop there. It’s also the mobility. Look at textiles in tires and cars and airplanes and the environment, as well as the wings of the windmills made of textiles.”

 

In examining the U.S. textile market in particular, Tack pointed out that the young and urbanized population is having an impact. He said they seek fast fashion and are eager to consume; strongly believe in locally made products; have a strong desire for “honest clothes,” or those made ecologically and with respect to labor and safety laws; and seek “value-added” products for design, comfort, ease of use, maintenance and durability.

 

In addition, energy availability and cost are “very attractive” for the U.S. textile industry, he said, not to mention labor costs and productivity, raw material availability, innovation and zero inventory retail models resulting from quick response production, proximity and service.

 

“I think that’s the reason we’ve seen investment in spinning here over the past couple of years,” he said. “That opens the way for further investments into weaving.”

 

“I believe the U.S. is still the world power,” Tack said. “People say China will become No. 1, but I don’t believe that. The reason is the U.S. is bringing the smartest people in the world here. Tapping the smartest brains out of the 7 billion world population will keep the U.S. ahead.”

 

He suggested that U.S. textile producers should not look too far when opportunities are close by. And importing carries a lot of hidden costs, including lead times, inventory and logistic organization, quality and obsolescence.

 

“There is a momentum to invest here,” he said. “The market is picking up, interest rates are low and the U.S. dollar is strong.”

 

‘Too much cotton’

 

Anthony Tancredi, CEO of Allen Cotton Co. and senior global platform head, Louis Dreyfus Commodities, Memphis, has spoken at this meeting for several years running. This year, he gave another insightful – and entertaining – outlook on the cotton market … while creating quite a fashion statement related to his presentation. He ditched the coat and tie this year in favor of an outfit made up almost entirely of manmade fibers, from his pullover to his shirt to his lounge pants to his socks. And, as a disclaimer from a cotton expert, all of the items were gifts, he said.

 

“I’m a walking synthetic ad right now,” Tancredi said. “But I wanted the visual today.”

 

In opening his presentation, he pointed out that the cotton market is full of uncertainty, except in one area: “There is too much cotton,” he declared, before running through several slides showing as much.

 

He then showed a list of recent headlines that included, among others:

 

• Synthetic fibers surpass cotton to dominate U.S. apparel imports;

• Cotton falls to five-year low on China import quota worries;

• American affair with cotton frays as manmade fibers take to catwalk; and

• ‘Athleisure’ wear: Goodbye blue jeans, hello yoga pants.

 

“I’m not excited about cotton right now – I’m frightened,” he declared.

 

He then did a deep dive into cotton related to world stocks, prices, surpluses, exports/imports, planting figures, etc. In his conclusion, he said that the global cotton market must find a way to increase cotton use and that, as long as government policies control inventories, market signals will be muted and uncertain, with prices unwilling to fall.

 

For U.S. cotton, “perhaps the cotton industry needs to look at new ways to do old things,” he said. He suggested unifying the segments to approach industry problems and building stronger connections in the value chain.

 

“Cotton has survived difficult times in the past,” Tancredi said. “Changes are coming – some fleeting, some permanent. Know the difference!”

 

The ‘love and serve’ model

 

Mike Pereyo, co-founder and co-CEO, OOBE, Inc., Greenville, S.C., offered an inspiring history of his apparel company, which he established two decades ago with his college friend Tom Merritt. (Read the OOBE story in our archives.)

 

He told a compelling story of how his company has grown from humble roots to now having apparel partnerships with the likes of Chik-fil-A, BMW, Skywest Airlines, the YMCA, Great Wolf Lodge, RaceTrac, Hendrick Automotive Group, Krispy Kreme, Verizon, Food Lion and Disney.

 

The company, Pereyo said, has grown as a result of holding true to its values – “love and serve.”

 

“The relationships we’ve built helped us find our purpose,” he said. “Love and serve people with our time, talent and resources so God may be celebrated through our faithful stewardship in all our relationships.”

 

He encouraged attendees to “build their bench” in this industry.

 

“Prepare for the future,” he said. “Help the next generation be able to sustain you. And you have to build your margin in order to build your bench. I sense the love and serve model in this room. I want to challenge all of you to look up because there is a heart and a person who sits across from you who wants to learn from you.

 

“The world and your work will distract you, but at the end of the day, the only thing you’ll remember is what impact you had on your relationships,” he added in closing.

 

Washington update

 

Gary Adams, president & CEO of the National Cotton Council of America, provided a Washington update as it relates to trade bills and farm policy. In particular, he discussed Trade Promotion Authority (TPA), the Trans-Pacific Partnership and other trade bills moving with TPA, the Export-Import Bank, Berry Amendment provision protections, the World Trade Organization’s export subsidies case against China, cotton in the WTO and more.

 

“Educating a large class of new members of Congress and their staffs on cotton and textile industry issues will be one of our challenges going forward,” Adams said.

 

Other challenges, he said, include an increasing need to grow PAC resources, rebuilding the demand for cotton, leveling the playing field and improving cotton’s profitability.