In his address, U.S. Textiles Singing the Blues? Carmichael presented a few statistics that came as good news to this group of textured yarn specialists. Related to capital investments, the U.S. was the second-highest country in the world for texturing machine spindle shipments last year, he said. Also, the U.S. remains a significant net exporter of textured polyester, with about 55,000 tons exported and 35-40,000 tons imported, he added.
From the last two years of data, the information after five months of this year is even more positive, with imports down substantially while exports are down much less, Carmichael continued, meaning the trade surplus has increased 300 percent over the first five months of the year.
He cited several overseas investments that bode well for the industry, including Golden Ladys purchase of Kayser Roth, Radicis purchase of Globe Manufacturing and Alpeks purchase of DuPonts share of a staple joint venture.
He also pointed out several domestic investments: Berkshire Hathaways buyout of Shaw Industries and Heartlands 60 percent investment in Collins and Aikman and its investment in Springs Industry in its bid to be taken private.
Carmichael then asked philosophically: If this is a sunset industry, then would there be overseas investment taking place? Would there be outside investment companies taking a significant stake in textile companies?
It is clear that some wise heads think that textiles in the USA is still an industry worth being involved in, he added.
Carmichael indicated that certain sectors of the industry carpet, automotive, home furnishing and industrial have a better chance of survival than others.
A necessary word of caution, though, is that no sector can regard itself immune from import attack, as we have seen evidence in all of the above sectors of increased import activity, particularly in home furnishings, he said.
Carmichael showed a number of charts related to the worldwide fiber scene and the textile trade. In a nutshell, demand for and market share of manmade fibers have steadily increased in recent years and is expected to grow at a faster pace in the coming years, he said.
Polyester, with a growth rate of almost 8 percent, is the leader in mill consumption, followed by polypropylene, he pointed out.
In the news ...
Week of August 6, 2001
Governors ask Bush
to support industry
WASHINGTON, DC President Bush is reviewing closely a letter asking for his support of the embattled textile industry, according to a White House spokesperson. The letter was signed by the governors of the four top textile-producing states.
With industry jobs falling at record pace this year, Govs. Mike Easley of North Carolina, Jim Hodges of South Carolina Roy Barnes of Georgia and Don Siegelman of Alabama urged Bush in the letter to recognize the deepening crisis in the American textile industry and to make maximum use of the various powers at your disposal to address this situation.
The governors also asked the president to recognize that the U.S. textile industry, like the steel industry, is facing a crisis of survival that is not of its own making and to use every tool at your disposal to combat this crisis, including use of our laws attacking unfair trade practices and prohibiting imports made from child labor.
Bush was also asked to keep the crisis from spreading by refusing to negotiate new trade agreements that will cause further damage to the textile companies and workers in our states.
In a statement, Charles A. Hayes, president of the American Textile Manufacturers Institute (ATMI) and chairman of Guilford Mills, Inc., expressed his appreciation to the governors.
The governors of our countrys four largest textile-producing states have recognized the clear threat the current textile crisis poses not only to their own states and constituencies, but to our nations economy as a whole, Hayes said. We appreciate their call for President Bush to similarly recognize the urgency of this situation and to make maximum use of his powers under existing law to confront the problems caused by foreign unfair trade practices.
In the letter, the governors pointed out that the U.S. textile industry has lost 56,000 jobs in the last year, which is more than 10 percent of its work force. In May alone, 9,000 U.S. textile workers lost their jobs as more than a dozen mills closed their doors, the letter went on to say.
Sulzer Textil sold to Radici company
WINTERTHUR, SWITZERLAND Weaving machine manufacturer Sulzer Textil has found a buyer Colzate, Italy-based Promatech S.p.A., part of the Radici/Itema Group.
The deal with Sulzer Textils parent, Sulzer Ltd., is subject to regulatory approval and would create a giant in the field. Promatech, which owns weaving machine brands Somet and Vamatex, is part of the Itema Group, the machinery arm of Radici.
Terms of the agreement were not disclosed.
Sulzer Textil said it will continue its business as an operationally independent group. This includes the right to use the trade name Sulzer Textil.
I am pleased that Sulzer Textil is being acquired by a strategically well positioned group, said Fred Kindle, CEO of Sulzer Ltd. For Sulzer, this is an important step towards completion of the divestiture program.
Sulzer Textil offers a broad range of weaving machines, from rapier to projectile to multi-phase technology. Regarding air-jet weaving machines Sulzer Textil has been collaborating for many years with Toyoda Automatic Loom Works of Japan.
Sulzer Textil, which recorded sales of about $400 million last year, employs about 1,850 people worldwide, including 133 apprentices.
In view of our strengths in quality, product innovation and services, together with the environment of Promatech and the Itema Group, I have full confidence in the long-term future of Sulzer Textil, said Ulrich Bolleter, president of Sulzer Textil.
Promatech employs about 750 people. The Itema Group is active in four market areas: weaving machines, winding machines, accessories and high-technology electronics.
Pillowtex sheds blanket unit
KANNAPOLIS, NC Pillowtex Corporation said Monday that it has signed a definitive agreement to sell most of the assets associated with its Beacon Manufacturing Company blanket division to Beacon Acquisition Corporation, an investment group consisting of current division managers and a private investor.
The purchase is subject to bankruptcy court approval and the purchase price of $16.8 million is subject to adjustments at closing, Pillowtex said.
Beacon Manufacturing Company, headquartered in Swannanoa, NC, near Asheville, is a Pillowtex subsidiary that designs, manufactures and markets blankets.
The agreement is for two Beacon manufacturing plants an acrylic blanket manufacturing plant located in Swannanoa and a cotton blanket manufacturing plant located in Westminster, SC. A blanket distribution facility, located in Mauldin, SC, will be leased temporarily from Pillowtex.
About 700 people are employed at the three Beacon facilities.
Crown sells adult bedding biz
ATLANTA Crown Crafts, Inc. announced that it has completed the sale of its adult bedding business to an executive group headed by former CEO Michael Bernstein.
The sale included the Calvin Klein, Royal Sateen and private label bedding and bath business, which accounted for $76 million of sales in the fiscal year ended April 1. Also included were Crown Crafts remaining operations at Roxboro, NC, and the New York office and showroom. Proceeds of the sale were $8.5 million cash, plus assumption of certain liabilities.
The loss on the sale is about $24 million, according to a company spokesperson.
The company said it also refinanced its existing short-term debt of about $75 million into a new $49 million credit facility with its existing lenders. The new credit facility includes a three-year revolving loan of $19 million, senior notes of $14 million due in five years and subordinated notes due in six years.
In addition, the lenders received warrants exercisable for non-voting common stock that is convertible into voting common stock. When exercised, the lenders will own 65 percent of the companys common stock on a fully diluted basis.
Mayfair Mills awaits word from lender
PICKENS, SC Mayfair Mills, Inc. is awaiting word from its primary lender on obtaining additional credit that may be necessary to stay afloat.
The financially strapped manufacturer, which employs more than 800 people in Pickens and Spartanburg counties, is hoping to secure additional financing from Wachovia Bank.
Mayfair announced in March that it would close plants in Starr, SC, Arcadia, SC, and Lincolnton, GA, eliminating 425 jobs, after failing to obtain further credit.
Last month, as a cost-saving measure, the company terminated the 401(k) plans of its remaining employees. Funds in the plan, which have been frozen, will be dispersed to employees after approval by the Internal Revenue Service, Frederick B. Rick Dent Jr., Mayfair Mills president, told The Greenville News.
Greenwood cutting 776 jobs
GREENWOOD, SC Privately held Greenwood Mills, a 102-year-old fabric producer, is eliminating about 776 jobs in three plant closings in as many states and a reduction at its corporate headquarters here, the company announced July 28.
In a release, the company blamed a flood of imports from low-wage countries. Operations at the plants will be discontinued during the last week of September, company President Ted Colcolough said in the notice.
Greenwood is shutting its:
Chalmers Plant, which employs about 302 people here and produces generic apparel and sheeting fabric;
Lindale Manufacturing plant in Rome, GA, a denim fabric maker and yarn dyer that employs 234 people; and
Fisk Road Aquatech plant, a home furnishings fabric producer, in Cookeville, TN, where 196 people work.
These plants have been operating at less than full capacity for some time, Colcolough said.
In addition, Greenwood will cut about 44 salaried and office positions at its Executive Office and Information Center, he added.
Galey & Lord slashing 380 in U.S.
GREENSBORO, NC Textile manufacturer Galey & Lord announced June 26 that it is laying off 380 people in two plant closings in North Carolina, discontinuing its garment-making operations in Mexico and cutting 5 percent of its salaried staff.
The company is closing its Asheboro, NC, weaving facility and its Caroleen, NC, spinning facility. About 215 people work at the Asheboro plant, while 165 are employed at the Caroleen operation.
In a statement, the company blamed the actions on a continuing difficult business environment.
The operations will be phased out over the next several months, the company said.
The company said it anticipates pre-tax charges associated with these actions to be between $70-$80 million.
Russell Corp. plans further reductions
ATLANTA Athletic apparel maker Russell Corporation said July 26 it would cut up to 270 additional jobs, or 1.6 percent of its U.S. work force, in an expansion of a restructuring plan announced in June.
Additionally, Russell has signed a letter of intent to sell its three Alabama-based yarn operations to Frontier Spinning Mills of Sanford, NC. Russell will still hold a minority stake in the operations, which employ about 700 people.
About 170 of the layoffs will come from the consolidation of its Mt. Airy, NC-based Cross Creek Apparel customized embroidery business with another artwear business here. The Cross Creek private label business and textile operations will remain in Mt. Airy, Russell said.
The company said it will eliminate between 50 to 100 people at its operation here.
Every aspect of these plans is designed to make Russell a stronger leader in the athletic, sportswear and casualwear apparel categories, said Jack Ward, chairman, president and chief executive officer.
Thomaston stays open for now
THOMASTON, GA August 1st came and went last week and Thomaston Mills stayed alive.
The company announced in June that it would be forced to shut down if a buyer wasnt found by that date. However, Thomaston will continue to ship orders through September as it continues to seek a buyer, according to reports.
The company, which filed for bankruptcy protection in June, has only 300 employees remaining, 1,100 fewer than it had on its payroll just three months ago.
Those employees are located in sewing, the Lakeside plant, the warehouse and the corporate office.
Analysts peg U.S. crop at 19.2 million bales
By Myrle Croasdale
CHICAGO A group of cotton analysts from across the U.S., speaking during a recent Ag Market Network conference call, estimated U.S. 2001-02 cotton production at 19.2 million bales, matching USDAs projection. They said Dec. could fall into the mid-30-cent-per-pound area as a result, languishing in a range of 35-45c for the next few months.
Looking at the Mid-South and Southeast, O.A. Cleveland, professor emeritus for Mississippi State University, said based on the U.S. Department of Agricultures crop ratings that put the regions cotton at 70 percent good to excellent and an acreage increase of 1.1 million from a year ago, the region should produce a record 11.5 million to 12 million bales of cotton this year.
Theres tremendous acreage out there, and crop conditions in the Southeast and the Delta are very good, Cleveland said.
Production of this size would mean an increase of 2.5 million bales from last year and would top the current 10.6-million-bale record set in 1996 by about 1 million.
This is a very healthy crop this year, Cleveland said.
The highlight in the mid-South is Louisiana. It has the absolute best crop in the U.S., with Mississippi not far behind, Cleveland said.
Dragging down the average is Missouri and Tennessee, though Tennessee has improved in the past week.
In the Southeast, North Carolinas crop is outstanding, Cleveland said, and USDA may have missed 50,000 acres in the coastal Blacklands area, which could raised plantings to 1.11 million for the state.
North Carolinas crop is outstanding, he said. Its had excellent moisture, and is a very well-fruited crop. South Carolina is not quite as good, but its still better than average. South Alabamas central valley is the best it could be on July 13 and as good as its ever been this time of year.
Partnership with government
needed for success, NCC says
WASHINGTON, DC For the U.S. cotton industry to meet some of the stiffest competition it has ever faced, it needs a U.S. government partnership for help in securing markets against sometimes unfair international competitors, a National Cotton Council official said here recently.
Robert Weil II, chairman of the NCCs International Trade Policy Committee, told the House Subcommittee on Specialty Crops and Foreign Agriculture Programs that the upcoming farm bill provides that panel the opportunity to reassert itself and fill an ever-widening void being created as the U.S. government appears to retreat in the face of international competition and the self-serving demands of our competitors.
The Montgomery, AL, cotton merchant said U.S. cotton needs to export more than 50 percent of the 2001 crop to prevent the industry from slipping even further into serious economic depression. He said domestic mill use of cotton is expected to fall 3 million bales from the 1997 level, while the U.S. crop likely will be similar to the past two years, meaning we will have to find a home in foreign markets for an additional 2 to 3 million bales of cotton or see our carryover levels soar.
Congress has provided many tools to assist agricultural exports, Weil testified. However, the viability of these programs is being threatened and their potential is not being fully realized.
As examples, Weil noted that Foreign Market Development program funding has failed to keep pace with inflation; Market Access Program funding has fallen by 55 percent since 1992 despite its clear positive impact; the export credit guarantee program the most cost-effective has been offered up by U.S. trade negotiators in return for no significant concessions by any competitors; and the Bush Administration has chosen to classify supplemental market loss assistance payments as subject to World Trade Organization (WTO) limits.
Hubtex flying high after 20 years
SPARTANBURG, SC To make the point that its business is still soaring after 20 years, employees of Hubtex of North America recently gathered around a company kite designed by master kite maker Chuck Holmes of Hubtex N.A.
Like its parent company in Germany, Hubtex Maschinebau Gmbh, Hubtex of North America began operations in 1981.
Since then, President Markus Heinis said, we have concentrated on establishing our niche as a premier supplier and maintainer of handling equipment and systems for the knitting and weaving industries.
Hubtex Spartanburg facility houses its service department, as well as its sales offices. In addition to its own products, Hubtex sells and services the Neuenhauser line of traveling cleaners and off-loom take-up equipment, as well as System Schultheis storage systems for the textile industry.
The past 20 years have been good for us, Heinis said, and we look forward to many more good years. So far, nobody but Chuck Holmes has said we should go fly a kite.
Lang Ligon & Co. adds Testa to mix
GREENVILLE, SC Lang Ligon & Co., Inc., announced the addition of Testa, S.p.A to its lines of equipment sold and serviced in the American market.
Testa S.p.A. designs and builds highly automated cloth inspection and wrapping systems. This 9001-certified northern Italian company has been producing inspection equipment for more than 30 years and today offers the highest possible level of automation, Lang Ligon said.
WestPoint posts expected loss
WEST POINT, GA Per its earlier warning to investors, WestPoint Stevens posted a second-quarter loss of $13.8 million, compared to a profit of $17.9 million last year. Those figures did not include restructuring charges.
Sales declined 13 percent as weak retail demand led to promotional prices.
During the quarter, West-Point recognized a $3.7 million charge net of taxes for the implementation of its restructuring plan, compared with a charge of $107.6 million net of taxes a year ago.
Consistent with its recently amended bank credit facility, the company said it will discontinue payment of its quarterly dividend for the foreseeable future.
Charges hit Cone in second quarter
GREENSBORO, NC Cone Mills Corporation paid a heavy tab of $33.6 million related to its restructuring program in the second quarter.
The company saw sales declines in almost every category, including: 12 percent in denim, 35 percent in khaki and 21 percent in decorative fabric sales. Sales, however, increased 4 percent in its commission finishing business.
Power outage stings Wellman pocketbook
SHREWSBURY, NJ A power outage at the Palmetto Plant in Darlington, SC, dug into Wellmans profits by $6.6 million in the second quarter.
The outage shut down the plant for about three weeks and resulted in lost production volumes of about 80 million pounds, split equally between the Packaging Products Group and the Fibers and Recycled Products Group, the company said.
Week of August 6, 2001
Dear Mr. President ...
Editors note: Published here is the letter sent by governors of the four top textile-producing states to President Bush on July 25. Asking the Bush administration for relief in the letter were Govs. Mike Easley of North Carolina, Jim Hodges of South Carolina, Roy Barnes of Georgia and Don Siegelman of Alabama.
"As governors of the four largest textile producing states, we urge you to recognize the deepening crisis in the American textile industry and to make maximum use of the various powers at your disposal to address this situation.
"Your administration has shown a commendable willingness to provide assistance to the domestic steel industry, which is currently facing difficult times. We believe that a similar effort needs to be made on behalf of the U.S. textile industry. Accordingly, we are asking you to take immediate action to help this critical manufacturing sector that contributes over $70 billion annually to our national economy and employs nearly 500,000 U.S. workers.
"The current economic downturn in textiles is even more dramatic than that being faced by steel. The American textile industry has lost 56,000 jobs in the past 12 months, which is over 10 percent of its entire work force. In May alone, 9,000 U.S. textile workers lost their jobs as more than a dozen mills closed their doors. Our four states, which are home to two-thirds of the textile employees in the entire country, are being especially hurt by these closings and layoffs, and our entire regional economy is being damaged. Further, as the textile industry is a vital supplier of goods and materials to the Armed Forces, these plant closings threaten our nations ability to maintain a reliable U.S. defense industrial base and thus our military readiness.
"Mr. President, these are hardworking Americans who earn their pay, which is on average more than double the minimum wage. In many small towns in our states there are simply no other opportunities for them to learn a new skill and find comparable employment. These people should not be forced to take lesser jobs that only pay the minimum wage. And they absolutely cannot afford to lose the health care or other benefits their textile employers provide.
"The people in our states are looking to you to show consistent leadership in confronting the textile crisis, just as you have acknowledged the problems facing the steel industry. ... Our textile crisis is even more severe. The domestic textile industry is not simply reporting sluggish sales or profits, as are other sectors the U.S. textile industry actually realized an annual loss last year.
"Textile companies in the U.S. have tried to help themselves by becoming more productive and thus remain competitive in the global economy. They have invested billions of dollars annually in the latest equipment and, as a result, the American textile industry is among the most productive in the world. American textile workers now produce over 41 square yards per loom hour, which is a 130 percent increase in just the last decade and nearly 400 percent higher than productivity rates of 25 years ago.
"However, the textile industrys efforts to modernize and remain competitive have been negated by the tidal wave of unfairly low-priced Asian imports that have flooded our country in recent years. The problems today have their roots in the 1997-98 currency devaluations in the Far East. Those currencies have never recovered their values, and the result has been a 40 percent (on average) decline in the cost of importing textile goods. More than any other factor, these devaluations are the cause of the damage being suffered by our textile industry and its workers. This has, in turn, harmed U.S. producers of cotton, synthetic fibers, wool, chemicals, machinery and other suppliers of the domestic textile industry. The damage in our four states has been especially severe because of the importance of cotton to our states agricultural economies. This downward spiral and its far-reaching impact cannot be permitted to continue, and we need your help.
"According]y, we urge you to recognize that the U.S. textile industry, like the steel industry, is facing a crisis of survival that is not of its own making, and to use every tool at your disposal to combat this crisis, including use of our laws attacking unfair trade practices and prohibiting imports made from child labor. In addition, we ask that you do not make this crisis even worse by negotiating new trade agreements that will cause further damage to the textile companies and workers in our states. Your immediate actions in the areas we have listed would provide the American textile industry with the assistance it needs to weather this critical period. We would also welcome the opportunity to meet with you at your earliest convenience to discuss this situation personally and to convey its importance to our respective states.
"We look forward to your response and to working with you to address this issue as expeditiously as possible to enable the U.S. textile industry and its employees to compete on an equitable basis on the international playing field."