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APSyFI: The national textile industry is headed for a trade deficit, 2018 exports grow 1% and imports grow 14% (yoy).--IKATSI: The growth of the national textile industry is still hampered by floods of imports, Indonesia needs a clothing security law.


	
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Home arrow Latest News arrow Textile Industry Production Costs Increase


				
			
			
Textile Industry Production Costs Increase PDF Print E-mail
Written by Maizer   
Wednesday, 26 February 2020
The spread of the corona virus has an impact on the textile industry and textile products (TPT) today. The supply of raw materials and parts for the garment industry machinery comes from China. Not only to Indonesia, other countries also experienced supply disruptions.

 

"Export-oriented clothes, especially garment, many are disrupted because many are late shipping from China. Our industry is forced to spend by air, not by sea. If by air, the cost is seven times more expensive. We have anticipated the Chinese New Year holiday. "It has been extended by two weeks because of the delay and the consequences that must be taken," said Ade Sudrajat, Chairman of the Advisory Board of the Indonesian Textile Association (API) in Jakarta.

 

Meanwhile, said Ade, the largest textile raw material is held by Korea, followed by China and then Taiwan. "From China, we take the raw material for the shirt fabric, take it from China. The blend material, the form of fabric that has become colored, is not yarn or fiber," he said.

 

Meanwhile, Secretary General of API West Java Rizal Rakhman said, his party had found the source of raw materials and spare parts from other countries such as South Korea and India. However, he continued, the prices of the two countries are 30 to 40 percent higher than China.

 

Although local manufacturers can fill all requests, according to him the price of local raw materials is still higher around 30 percent from Chinese raw materials. Therefore, Rizal assessed that the reduction in gas tariffs in the early second quarter of 2020 could significantly reduce the price of local raw materials.

 

On the other hand, Ade said there was an increase in demand for garment products from the United States and Europe due to the outbreak of the corona virus in China. In fact, the increase is up to 20 percent. "Brand holders in the US and Europe have minimal supply from China, even some of the outlets there are closed because there are no goods. So, they share orders to several countries where the risk of failure to send is low. Indonesia is a choice. They added 20 percent from Indonesia, both the US and Europe, "he said.

 

Through this increase, the domestic textile industry is expected to be slightly supported, bearing in mind the achievements of last year were less encouraging. "Last year production was quite stagnant and very slow. This year I see an opportunity to grow 5 percent. But, it depends on when the corona is finished and how quickly the DPR can finish Omnibus Law, "he said.

 

Based on data released by the Central Statistics Agency, exports of clothing and accessories products in 2019 reached a value of US $ 4.48 billion or lower than the acquisition of 2018 with US $ 4.49 billion. America became the export destination with the highest increase for the December 2019 period with US $ 192 million.

 

In general, the value of Indonesia's exports in 2019 has a valuation of US $ 167.5 billion. This figure is decreased from the acquisition of 2018 which amounted to US $ 180 billion.

 
		
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