Friday, December 2, 2005

The Hosiery Association Centennial: In Step With The Industry For 100 Years – There are 10 THA SHOPPING DAYS left until the holidays are upon us. Give your employees, coworkers, friends in the industry a unique piece of hosiery history. Purchase copies of THA’s centennial publication. This is the only commemorative book that captures the Association’s 100-year history of leaders, events, programs and services. Information on how to order is available on our web site. ORDER NOW TO GET THEM IN TIME FOR THE HOLIDAYS. These unique gifts and are only available through THA. Requests to have the author, Sally Kay, sign your copy are also being taken via the order form. Visit www.hosieryassociation.com or contact THA staff at 704-365-0913 to obtain your history book order form.

AL & TN Chapters Christmas Party: The combined chapters Christmas party will be held NEXT Friday, December 9 at The Chattanoogan in Chattanooga, TN. The holiday event begins at 6:00 p.m. with a Happy Hour, Dinner at 7:00 p.m. and dancing from 8:00 p.m. until midnight (all times are Eastern). Live entertainment is being provided by “Still Kickin,” a local band from Dekalb County Alabama.

MARK YOUR CALENDARS FOR THA’s MARKETING CONFERENCE, which will be held January 23 and 24, 2006 in Charlotte, NC. More details in the next Insider.

THA’s 101st Annual Convention: The 2006 Annual Convention will be held April 27-30 at The Mulberry Inn located in Savannah, GA. General information about the convention and the Savannah area was published in the November/December issue of Hosiery News. The Program Committee is hard at work making plans for this exciting industry event. Detailed information regarding the program, speakers, and hotel registration will be available in the January/February issue of Hosiery News and also will be posted on the THA website. Please stay tuned for information as it becomes available.

2006 CHA Luncheon Sponsorship opportunities are still available. If your company is interested in sponsoring any of the 2006 CHA luncheons, please contact Mike Austell at 704-365-0913 ext 204. Call early before all dates are taken. All luncheons are held on the 4th Thursday of the month and alternate between Hickory (Feb, Apr, Aug & Oct)* and Greensboro (Jan, Mar, May & Sept)*. *Please note that the months have been switched for the Hickory and Greensboro sites to avoid past conflicts.

Datang Emerges as Major Sock Production Base in China: You may have never heard of Datang, a town located in Zhuji in East China's Zhejiang Province, but socks made in this town are already filling up sock drawers everywhere. Datang has developed into a sock city that makes 9 billion pairs of socks annually on average, accounting for 65% of the national market and one third of the world market. As a pillar industry of Datang, socks industry has made this town the world's biggest sock production base. In 2004, Datang had more than 10,000 sock enterprises and 100,000 sock machines. "Apart from being the world's largest production base, we are aiming to build the most prosperous sock market, globally renown sock brands and a distributing center for all brands," Lou Jianming, a senior government official of Datang, said. Datang has hosted China International Hosiery Exposition 6 times since 1999, attracting major sock manufacturers and sales enterprises from both home and abroad. Now Datang has had its own registered brand name socks, such as "Danjiya", "Buren" and so on. Danjiya was awarded "China Quality Brand" in 2004.

Calvin Klein Women’s Better Sportswear Names Chris Jackson Vice President of Design: Mr. Jackson most recently served as design director of DKNY women’s collection, where he was responsible for the overall design direction for all categories of DKNY women’s for nine years. Prior to DKNY, Mr. Jackson held major design posts at Nautica, French Connection, and Anne Klein.

Knitwear Makers Visit Bangladesh: On November 26, leading manufacturers of knitwear products visited Bangladesh to explore the possibilities of entering into joint venture arrangements for knitwear garment production there. The delegation was led by Avais Mazhar Hussain of Angora Textiles. A spokesman of Pakistan Hosiery Manufacturing Association (PHMA) said on Saturday that the situation of deteriorating competitiveness of Pakistan’s knitwear industry was forcing the well-established industrial units to think of shifting their businesses outside the country because of the higher cost of manufacturing.

“Overseas markets can no longer absorb our internal pressures (of higher costs). This situation is an unhealthy sign for our economy because shifting or relocation of manufacturing units to other destinations will result not only in massive unemployment in the country, but will also slowdown the economy.” The home textile industry, the spokesman said, had also undertaken similar exercise. “But perhaps the government does not seem to be concerned over these alarming signals,” he said. Bangladesh has over the last few years developed woven and knitted garments manufacturing industry and has achieved good results in the international market. Its export of woven and knitted garments is much higher than of Pakistan. Sri Lanka is another similar example. Both the countries are importing cotton and other raw materials and exporting manufactured textile products to other countries. “If the Pakistan government could think over the reasons of uncompetitiveness of the knitwear industry and the factors responsible are redressed, we would have much more potential than any other country to establish ourselves in the international markets,” the spokesman said.

Hosiery Makers Employ Chemistry for Better Sales: From a laboratory in North Carolina to a research center in Wilmington, Del., teams of scientists are hunkered down trying to solve one of fashion's greatest mysteries: how to get women to wear pantyhose again. In their latest bid to revive the sagging hosiery business, makers are turning to science and trotting out nylons and tights that seem more likely to show up at science fairs than on the runways of Paris or Milan. Capezio says its "microcapsules" filled with aloe - scented with a hint of lavender - burst as women move, to combat dry skin and chafing. Calvin Klein is using a high-tech fiber with tiny channels dug into the yarn that the company says drains away sweat from legs. Meanwhile, No Nonsense is borrowing technology from surgical socks; its new Smart Support hose are engineered with a tighter weave at the bottom to keep veins constricted and the blood flowing. Hoisery makers hope the time is right. With skirts making a comeback - sales rose 10 percent last year, the biggest increase since 1999, and sales are up 5 percent so far this year - women might be more likely to slip back into hose, at the very least, to keep warm.

Sun Capital to Buy Sara Lee’s Undergarments: Typically, when one thinks about Sara Lee Corp., visions of cakes, pies and other tasty confections come to mind. But when Sun Capital Partners ponders Sara Lee, the private equity firm is struck by thoughts of bras and hosiery. Indeed, both intuitions are correct, as Sara Lee is an international purveyor of consumer goods ranging from Ball Park hotdogs to Hanes underwear. And lately the company has been working on streamlining itself by selling off non-core assets. As such, Sara Lee agreed earlier this month to sell off its European branded apparel business to Boca Raton, Fla.-based Sun Capital for approximately $100 million ($117 million), plus potential payments based on the future performance of the business. Sun Capital declined to comment on the transaction until its final closing, which is expected to take place sometime in January. The assets to be sold include Sara Lee's branded bra and hosiery businesses in France, Germany, Italy, Spain, the U.K. and throughout Eastern Europe, which markets names such as Dim, Playtex, Wonderbra, Abanderado, Nur Die and Unno. In all, these businesses generated nearly $1.2 billion in sales throughout fiscal year 2005, which, for Sara Lee, ended on July 2. Sara Lee will retain no equity interest in the business after the sale closes.

Developers Unveil Proposal for Wal-Mart Supercenter: The developers of a proposed Wal-Mart Supercenter at the former Rockland Drive-In Theater in Monsey, New York, presented preliminary plans to the Ramapo Planning Board last night. National Realty & Development Corp. of Purchase is seeking to build a single, 35-foot-high building on the 22-acre site for use as a 215,000-square-foot Wal-Mart. Steven Grogg, the project's engineer, briefly discussed the project's details with the board and said they were conducting various studies and expected comments from the state Department of Transportation by the weekend.

EU Pushes for Hong Kong Ministerial to Focus on Development Package: European Union (EU) Trade Commissioner Peter Mandelson said this week that since the WTO’s Hong Kong ministerial meeting will not result in the establishment of modalities for further Doha Round negotiations, ministers attending the gathering should instead focus on approving a package of measures designed to help developing countries. The EU is proposing that such a package include the following measures: a commitment by all industrialized WTO member countries to provide duty- and quota-free access to all products from all least-developed countries (LDCs); special and differential treatment proposals to improve the flexibilities for LDCs that already exist in the WTO; enshrining in the WTO’s intellectual property agreements conditions for better access to cheap drugs against pandemics; a strong “aid for trade” package, along the lines of what was agreed at the most recent G-8 summit, to help strengthen the capacity of developing countries to trade; intensified work to address concerns that serious cuts to tariffs will erode the preferential access that developing countries currently have to industrialized country markets; and ambitious and accelerated commitments on cotton above and beyond agreements on other agricultural products, including (a) eliminating export subsidies for cotton, (b) drastically reducing trade-distorting domestic subsidies, and (c) reducing or completely eliminating all import tariffs on cotton by all developed countries.

Egypt Expecting Announcement of FTA Talks with US Soon: According to Reuters, Egyptian trade minister Rashid Mohamed Rashid recently said that he expects the launch of FTA talks between the US and Egypt to be announced in the near future.. USTR Portman has said that a decision on whether to pursue an FTA with Egypt could come by the end of this month.

EU Proposes New Customs Code: The European Commission announced this week that it has adopted two proposals that would modernize the EU Customs Code and introduce an EU-wide electronic customs environment. The first proposal would (a) simplify the structure of the code and provide for more coherent terminology, with fewer provisions and simpler rules; (b) provide for radical reform of customs import and export procedures to reduce their number and make it easier to keep track of goods; (c) rationalize the customs guarantee system; and (d) extend the use of single authorizations, whereby an authorization for a procedure issued by one EU member state would be valid throughout the EU. The second proposal is designed to (a) make member states’ electronic customs systems compatible with each other; (b) introduce EU-wide electronic risk analysis and improve information exchange between border control authorities; (c) make electronic declarations the rule; and (d) introduce a centralized customs clearance arrangement. The Commission estimates that the plan, which is not likely to be fully implemented until 2012, would boost annual trade by $60 billion and assist efforts to fight trade in counterfeit goods.

US-China Commission to Hold Hearing on Hong Kong Ministerial, Other Trade Issues: The US-China Economic and Security Review Commission (USCC) will hold a public hearing on December 8 in Washington, DC. The purpose of the hearing is to examine the issues to be addressed at the Hong Kong Ministerial Conference of the WTO Doha Round. Invited witnesses include international trade law experts, Administration officials, and labor and industry representatives. The hearing will focus on the process whereby US trade objectives are determined and pursued. It will also address the results of US trade policies toward China, discuss the results of the Doha Round, and provide an assessment of the Administration's fulfillment of Congressional objectives as defined under Trade Promotion Authority (TPA).

Treasury Department Hails Improvements in China's Exchange Rate: Treasury Secretary John Snow said this week that, in recent months, China has demonstrated greater exchange rate flexibility by adopting a new exchange-rate mechanism and no longer is considered a currency manipulator. He added, however, that China must do even more to develop open capital markets "as quickly as possible." The Treasury Department also found that Malaysia continues to maintain a "rigid" exchange rate, despite adjusting its rate mechanism in July, Snow said. But, he stated, Treasury judged no major U.S. trading partner nation as a currency manipulator. This finding, the report said, is consistent with findings over the past 11 years of reporting. Snow said achieving adjustments in global economic imbalances is a "shared responsibility" of all countries involving increased savings in the United States, including the reduction of fiscal deficits, boosting the growth rates of major trading partners, as well as achieving greater exchange rate flexibility.

US, Pakistan Negotiating BIT; Pakistan Wants FTA: Following a meeting with USTR Rob Portman, Pakistani Commerce Minister Humayun Akhtar Khan said that Pakistan wants an FTA with the United States, a step he says is essential in the fight against poverty and terrorism in the region. Pakistan is currently negotiating a bilateral investment treaty (BIT) with the US, which is expected to be concluded by the end of 2006. The talks this week were held under the bilateral Trade and Investment Framework Agreement (TIFA). More than 85% of Pakistan’s exports to the US are textile and apparel products, an issue that Khan acknowledged would be problematic during FTA negotiations

Brazil Again Suspends Retaliation Proceedings in Cotton Dispute: Last week, the US and Brazil agreed to suspend proceedings on Brazil’s request to impose $1 billion in annual retaliation in the ongoing dispute over US cotton subsidies. Brazil was seeking WTO authorization to retaliate against the US over its failure to meet a September 21 deadline for removing the adverse effects of those subsidies. The new agreement is similar to a July suspension of proceedings after Brazil threatened to impose $3 billion in retaliatory sanctions when the US missed a July 1 deadline for removing cotton subsidies ruled illegal by the WTO. The US has since moved to comply, as House and Senate committees have both approved a measure that would eliminate the Step 2 cotton subsidy program as of August 1, 2006.

Andean Countries Say More FTA Talks Needed: Colombia and Ecuador left talks with the US on the Andean FTA unfinished last week, saying they would need at least one more round of negotiations in order to finalize a deal. Colombia’s chief negotiator, Hernando Jose Gomez, said the remaining issues were intellectual property rights (IPR) and agriculture. Gomez said the US and Colombia could hold an additional round of talks before the end of 2005 in an attempt to finish the agreement. Ecuador's top negotiator, Manuel Chiriboga, also said agriculture was a major sticking point, but added that talks between the US and Ecuador are not expected to resume until after the new year.

CITA Ends Consideration of All Pending China Safeguard Petitions: On November 23, the Committee for the Implementation of Textile Agreements (CITA) announced that it has ended further consideration of all pending requests for safeguard action on imports of textiles and apparel from China. There a number of requests; however, socks are not included.

USTR Appoints Scott Quesenberry as Special Textile Negotiator: US Trade Representative (USTR) Rob Portman announced this week that Scott Quesenberry will join USTR as the Special Textile Negotiator. Quesenberry, who is replacing David Spooner, will start on December 4 and will travel to Hong Kong for the WTO ministerial meeting. He will be responsible for supervising US trade negotiations involving textiles and apparel and working to expand US industry access to overseas markets. For the past three years, Quesenberry has worked for Senator Elizabeth Dole, most recently as Legislative Director.

Increase in NAFTA Surface Trade in September: The BTS reported this week that US surface transportation trade in goods with NAFTA partners Canada and Mexico was valued at $61.2 billion in September 2005, the highest monthly level ever recorded. From September 2004 to September 2005, surface transportation rose 11.4%. Surface transportation consists largely of freight movements by truck, rail, and pipeline and accounts for about 90% of US trade by value with Canada and Mexico. According to the BTS, total surface transportation trade value in September was up 33.6% compared to September 2002 and 93.4% compared to September 1995. Exports were up 77% compared to September 1995, while imports were up 107.4%. Surface trade between the US and Canada reached a new monthly high of $40.4 billion in September, up 14.1% from September 2004; exports by truck increased 11.4% by value, while imports by truck rose 8.9%. US-Mexico surface transportation trade totaled $20.8 billion in September, up 6.5% from a year before; exports by truck rose 5.1% by value, while imports by truck increased 7.3%.

China Bilateral Textile Trade Agreement’s Impact on Legwear: The recently negotiated deal contains the following safeguards on socks for the next three years (including infants’ socks). Here are the current allocations for Chinese imports for socks: 2006 – 61,146,461 dozen pairs; 2007 – 70,318,431 dozen pairs; 2008 – 80,866,195 dozen pairs. Please note that a sheer category, HTS number 6115209010 has been added to the safeguard provision as well. Here are the current allocations (including socks and sheers) 2006 - 64,386,841 dozen pairs, 2007 - 73,963,859 dozen pairs, and 2008 - 85, 058,437 dozen pairs. Note that sock imports, however, must adhere to the numbers mentioned initially.

The contents printed in this document are informational in nature. They are gathered from various industry sources and do not necessarily reflect the views and/or actions of THA.

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