The National Council of Textile Organizations (NCTO) has just concluded its 11th annual meeting in Washington, DC, USA. The US textile industry is on the rise and there is concern over implications of the ongoing Asia/Pacific and European trade agreements. Internally, NCTO is still in the first year of the merger of three formerly independent textile organizations.
NCTO is a unique association representing the entire spectrum of the textile sector from fiber to finished textile product. Currently, the organization represents 150 companies, had a 2013 operating budget of $1.5 million, and maintains a staff of 6 full-time plus a full time industry consultant. The mission of NCTO is to focus on creating powerful national and international alliances to advance the interests of the U.S. textile sector.
Auggie Tantillo has been NCTO president for 8 months. Mr. Tantillo is a well-known industry/ government textile veteran in Washington. Early in his career, he served as Deputy Assistant Secretary of Commerce for Textiles, Apparel and Consumer Goods and, prior to his appointment as NCTO president, he was the Executive Director of the American Manufacturing Trade Action Coalition (AMTAC).
Steve Warner, publisher of BeaverLake6 Report, interviewed Mr. Tantillo for this report.
BeaverLake6 Report: Can you tell us the state of the US textile industry?
Tantillo: The US textile industry has experienced fair stability and steady growth over the past few years. This important domestic manufacturing industry is the third largest exporter of textile products in the world. Exports of all textile products were nearly $17.9 billion in 2013. Lately, we have seen numerous investments from foreign companies in yarn-spinning plants. A crucial aspect to the attractiveness of building in the US and creating jobs is the Yarn-Forward rule.
BL6: What is the status of the Trans-Pacific Partnership agreement negotiations? It was hoped the agreement would originally be finished by 2012, then 2013 and now it may not be concluded in 2014. Why so slow in getting this done?
Tantillo: Well, we are operating under the assumption it will be done sooner than later. But these types of agreements seem to have their own pace. As more countries become involved, there are more issues which need to be addressed. Vietnam’s inclusion created a concern for us with the Yarn Forward rule. The agreement, though, isn’t just about textiles. Japan’s inclusion has created concerns regarding agricultural products, and these types of other non-textile issues are causing, in part, the slow pace of the negotiations. And, the wildcard for this whole agreement for the US is the Congressional Fast Track authority to pass it. We need it.
BL6: Will Yarn-Forward be included in the agreement, and, if so, will it be a strong rule similar to what we have seen in other US trade agreements?
Tantillo: That’s a good question. We have received every indication that the Yarn-Forward rule will be included in the agreement. We feel it is essential the rule remain strong and comprehensive in its product coverage with its only flexibility being the short supply list. We are pressing for a strong Yarn-Forward agreement similar to the NAFTA/CAFTA agreements. But there is a strong lobbying effort by US apparel importers and retailers to ease up on the requirements. It’s an intense fight right now.
BL6: TPP, from a textile point of view, seems to be only a concern for those supplying the apparel industry. How does the TTP impact the domestic technical textiles industry?
Tantillo: There are major players in the TPP that are significant producers of technical textiles, especially Japan. Vietnam is also becoming a significant exporter of technical textiles.
BL6: What is the status of the Transatlantic Trade and Investment Partnership (TTIP)? Comparing it to TPP, should the technical textiles industry be more concerned about this agreement?
Tantillo: The 4th round of TTIP negotiations was held in Brussels in March. The European Union is a huge market for industrial textile yarns and fabrics. This agreement will be beneficial from the standpoint of US producers being able to access the European marketplace.
BL6: Are the two agreements similar in scope?
Tantillo: There are some challenges and differences between TTIP and TPP that are a concern for the US textile industry. In TTIP, for example, the EU favors a complicated Fabric-Forward rule as opposed to a Yarn-Forward rule. The EU is also pressing for access to US military contracts which means a weakening of the Berry Amendment. We would resolutely oppose any changes in the Berry Amendment.
BL6: The Textiles Enforcement and Security Act (TESA) recently was re-introduced in Congress. Will it get passed or will it stall?
Tantillo: We are hopeful that it will pass. However, its success is likely tied to larger issues such as The Customs Reauthorization Act. If a bigger customs and trade package moves through Congress, it would give us a much greater probability of getting TESA language adopted.
BL6: What’s the status of the National Defense Authorization Act? Is there anything to be of concern or interest by the technical textiles industry?
Tantillo: It has been enacted and there are some notable textile provisions. Title 1, Section 141, requires budget justification display for personal protection equipment. Title1, Section 146, requires study on 1) procurement and 2) research and development of personal protection equipment plus recommendations on how to improve innovation and competition. And the last significant provision for technical textiles is Title III, Section 352, which revises policy on combat and camouflage uniforms. This policy would require all the services to wear the same camouflage and ACU’s down the road.
BL6: Has any analysis been done on the impact of the Korean-United States trade agreement (KORUS). There was a lot of concern before it passed in 2011.
Tantillo: There has not been an analysis done but there have been reports of companies who have been directly affected, especially in the area of industrial fabrics. There has been substantial growth on the part of Korean exports to the US market.
BL6: What are the priorities for NCTO in 2014?
Tantillo: We have to ensure the Trans-Pacific Partnership (TPP) trade agreement is concluded in a sustainable and fair manner allowing the US textile industry to continue to be a viable player in the global textile marketplace. We have to make sure the Berry Amendment remains intact in the TTIP negotiations.
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October 8-10: 2018 AUSA Annual Meeting & Exposition, Washington, D.C., USA
October 9-12: Nonwoven Fabric Property Development and Characterization, Raleigh, N.C., USA
October 10-11: 4th International Conference on Nonwovens for High-Performance Applications, Cannes, France
October 15-19: ITMA Asia + CITME 2018, Shanghai, China
October 15-19: CAMX, Composites and Advanced Materials Expo, Dallas, Texas, USA
October 16-17: GeoDallas 2018, Dallas, Texas, USA
October 16-18: IFAI Expo 2018, Dallas, Texas, USA
Click here to view the complete technical textiles events calendar that includes show information links.
NAFTA Replacement Agreement Negotiated. On October 1, President Donald Trump announced the US, Mexico and Canada had reached an agreement whichreplaces the North American Free Trade Agreement (NAFTA) that went into effect in 1994. The new United States-Mexico-Canada Agreement (USMCA) contains provisions and language that has an impact on the technical textiles industry; the most important are 1) a special section covering textiles and apparel and 2) rules of origin that will require 75% of automotive content (under NAFTA 62.5%) be made in North America. Mexico and Canada are the two largest importers of US made technical textiles and the automotive industry is the largest intended end market of these technical textiles. Click here to go to the United States Trade Representative's website and read the "Textiles and Apparel Goods" chapter. Posted October 3, 2018
Fiber Publication Acquired. INDA, the Association of the Nonwoven Fabrics Industry, today announced the acquisition of two leading industry publications: International Filtration News and International Fiber News. The association purchased the publications from International Media Group, Inc., based in Tempe, Az., USA. The purchase price and terms were not disclosed. The publications each have circulations of 8,000-plus domestic and international readers and have served their readers for over three decades. Both are published six times a year in print and digital formats. The acquisitions will expand INDA’s reach and relevance in the key markets the print and digital publications serve with a particular emphasis on the filtration and separation segment as INDA launches its new FiltXpo event to be held in Chicago every 18 months starting February 26-28, 2020. Click here to read the INDA press release on the purchase. Posted October 2, 2018
On September 24, 2018, US Senator Sheldon Whitehouse and the University of Rhode Island Business Engagement Center helped to launch the Rhode Island Textile Innovation Network (RITIN). The event was held in Pawtucket, R.I., US, at the Slater Mill Museum. RITIN is a trade group formed with the objective to guide the growth of the state's textile industry in the 21st century. "The Rhode Island Textiles Innovation Network is an innovative business partnership to help Rhode Island stay at the forefront of advanced textile manufacturing," said US Congressman David Cicilline. 14 companies of the state's textile industry participated in the meeting including American Cord & Webbing, Cooley Group, and Kenyon Industries. Click here to view a video of the opening address by Lori Urso, Director of Slater Mill Museum. [Note: The original post reported an incorrect the date of the meeting.] Posted September 28, 2018
Automotive Manufacturing Leading End Market for Technical Textiles Shipped to Mexico.
The United States and Mexico have reached a preliminary agreement that covers a substantial revision of the North American Free Trade Agreement (NAFTA); specifically, the rules of origin for automotive parts. It is expected to incentivize billions annually in additional US vehicle and auto parts production.
To qualify for zero tariffs under NAFTA, the current rule of origin requires 62.5% of the automotive parts must be made in NAFTA countries (Mexico, Canada and US). The new agreement increases to 75% for the parts to avoid the tariff. What's intriguing is that we don't know if the countries still include Canada, a substantial manufacturer of vehicles and automotive parts. Regardless, this will most certainly be a boon for US technical textile manufacturers as almost 50% of US technical textiles exports goes to Mexico and automotive fabrics are the leading destination end-product segment in making products such as airbags, headliners and seating.
Sobering Thought. Despite the "first glance" optimism, there may well be concern this revision could backfire on the US and Mexico. As I previously noted in my 2018 State of the US Technical Textiles Industry (March/April 2018, Textile World), increasing the percentage of automotive component parts (plus a new requirement that 40-45% of the auto content be made by workers earning at least $16 per hour) could end up pricing Mexican-made vehicles out of the very competitive global marketplace. Mexico currently makes 3.4 million cars annually for the world market.
Mea Culpa. In my same article noted above, I honestly thought revisions to NAFTA would not get done in 2018 because of the elections going on in Mexico, Canada and the US. I underestimated the dodged determination of the Trump Administration to push this trade issue forward. Why Mexico has acted on it without Canada's input is still to be understood.
Click here to read the entire statement posted by the US Trade Representative.
Posted August 28, 2018
In a message to BeaverLake6 Report, JEC Group President Frédérique Mutel has confirmed she has stepped down at the leader of the composite trade organization that she has led since 1997. At the head of JEC since its creation, Ms. Frederique Mutel fully committed to the expansion of composites, was instrumental in the establishment of JEC as provider of high value knowledge and networking services. At the same time, conducting a strong international development. No replace has been announced.
On July 13, 2018, Ms. Mutel was promoted to the rank of Officer in the Order of the Legion of Honour by decree of the President of the France. A very deserving honor for a key leader in the development of the composites industry. Posted July 25, 2018
Are you looking for a quick understanding of the China technical textiles industry? Through our special relationship with China Nonwovens & Industrial Textiles Association (CNITA) and their China Textile publication, BeaverLake6 Report is pleased to post the English-translation of the recently issued "Status Quo of China's Nonwovens and Industrial Textiles Industry, 2017." The report covers the different levels of the industry, geographic export demographics, and forecast the needs in the major end market applications. Click here to read the report in our China Textile website section. Posted June 18, 2018
I am pleased to announce the second part of my report 2018 State of the U.S.Technical Textiles Industry has been published by Textile World magazine.
This first part features a general industry overview, plus an evaluation of the status and impact of US trade positions.
The second part, featured in the April/May issue will cover major end markets for technical textiles such as automotive and military.
Click here to go to the Textile World website to download a copy.
Steve Warner, Publisher
The joint owners of the ITMA Asia + CITME 2018 textile machinery exhibition have announced new dates for the 6th combined showcase to be held at the National Exhibition and Convention Centre in Shanghai, China. The new dates are October 15-19, 2018. According to show owners CEMATEX and Chinese partners, the Sub-Council of Textile Industry, CCPIT (CCPIT-Tex), China Textile Machinery Association (CTMA) and China Exhibition Centre Group Corporation (CIEC), the shift in the exhibition dates is due to a new national initiative, which affected the scheduling of all events at the exhibition center in October. [Note: BeaverLake6 Report is an industry media partner for the show.] Posted February 11, 2018
In October at the IFAI Expo 2017, I had the opportunity to sit down with -- at the time -- incoming Glen Raven CEO Leib Oehmig for an interview that has now been posted on the Textile World website and will also be in their printed November/December issue.
I've known Mr. Oehmig for probably more than 20 years and have watched his steady management progression within the Glen Raven organization. During the interview, he was very gracious with his time at a busy show and transparent in answering questions on a far-ranging number of topics including the management transition from Alan Gant, Jr., to Mr. Oehmig, the first non-Gant family member to lead Glen Raven. Click here to read the interview and learn more about the thoughts of one of our industry leaders.
As the saying goes "Politics make strange bedfellows." Today we find more than one-third of the Senate Democrats urging the inclusion of key amendments in the US FY 2018 National Defense Authorization Act (2018 NDAA) that would strengthen the US government's "Buy American" policies.
Versions of the NDAA were recently passed by both the Senate and House and a joint committee is working out a single bill. The submitted Senate version, however, left out proposed key amendments designed to prevent the weakening of domestic sourcing for the US military. One amendment included the prevention for lifting of the restrictions in place for domestic sourcing of wearable electronic products and another amendment prevents certain exceptions to the Berry Amendment which would allow non-domestic sourcing through memoranda of agreement with foreign governments.
What's the "strange bedfellows" aspect? Well, "Buy American" is also one of the key positions taken by the Trump administration. So, we have both the Democrats and the Trump administration on the same side, trying to keep strong the US domestic capability for supplying the military. Strange bedfellows given the current political animosity in Washington...but still the cooperation is vital for the US domestic textile industry.
Posted November 3, 2017
Since last August, the US Navy has been planning to phase out its iconic traditional wool peacoat in favor of a less expensive, synthetic cold weather parka which is lighter in weight and more versatile in types of inclement weather. It actually replaces two types of coats and the seabag the wool coat is stored.
The wool coat, however, has some powerful friends in the US Congress. Companies such as Northwest Woolen Mills in Woonsocket, R.I. and Sterlingware in Boston, Mass. Altogether, the supply chain involved in the manufacture of these woolen peacoats -- including sheep farmers -- is estimated to account for 400 jobs in the Northeast. Add to the drama that the new parka, made by the long-time military supplier Propper, is expected to be manufactured in Puerto Rico, a perceived feeling the new coat will be made by non-American workers.
June 29. 2017
The Office of the U.S. Trade Representative (USTR) has released President Trump's 2017 Trade Policy Agenda. The document, officially called 2017 Trade Policy Agenda and 2016 Annual Report of the President of the United States on the Trade Agreements Program, outlines the new Administration’s four trade priorities:
BeaverLake6 Report has created a special page within this website and placed the first chapter of the 336-page document which summarizes the policy. Click here to read it. Posted March 2, 2017
Back on March 24, 2016, I was one of the first to predict the Trans-Pacific Partnership (TPP) agreement was a dead deal. In fact, I said that I wouldn’t be surprised that, if Donald Trump became President, the agreement is shredded on day one of his new administration. Well, I was off by three days. Yesterday, President Trump signed an Executive Order, officially withdrawing the United States from the TPP agreement. Now the question is can the National Council of Textile Organizations put together a comprehensive plan for the domestic textile industry in a post-TPP era? Click here to read the rest. Posted January 25, 2017
In 2015, I posted more than 425 items of interest for our industry on the BeaverLake6 Report website. In reviewing it all last week, it got me to thinking about putting together a list of influential events, news and trends that I observed during the past year. I have focused primarily on the US marketplace but each of “the things that mattered” to me has global implications.
So, here go my thoughts in no particular order of importance. Let me know if you agree or if I have missed some. Click here to read the list.
Posted January 17, 2016
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