Turkey’s clothing manufacturers are facing rising prices as a result of efforts to support the cotton industry.

November 24, 2023

Turkey’s clothing manufacturers are facing rising prices as a result of an effort to support the textile industry.

On November 15, 2023, an employee at a cotton factory in Istanbul, Turkey, steel clothing. Umit Bektas/REUTERS

Caglayan Ceyda

ISTANBUL: After the government increased taxes on textile imports, industry leaders claim that Turkey clothing manufacturers, the third-largest suppliers of clothes to Europe, now face higher manufacturing costs and run the risk of falling further behind their Asian rivals.

Next week, Ankara increased tariffs on hundreds of inbound textile products by 30 to 100 % in an effort to support local yarn and fabric manufacturers who had been pleading for assistance against a wave of less expensive imports.

Officials from Apple claim that the new fees are straining the sector, which is one of Turkey’s largest employers and provides lightweight German brands like H&amp, M, Mango, Adidas, Puma, and Inditex.

According to industry representatives, job cuts may occur as transfer costs rise and Turkey producers lose market share to competitors like Bangladesh and Vietnam.

Essentially, exporters can qualify for tax exemptions, but industry sources claim that the exemption process is expensive, time-consuming, and in practice does not work for some businesses.

The industry was now dealing with rising prices, declining require, and lower profit margins brought on by what exporters view as an overvalued lira, as well as the results of Turkey’s years-long experiment with cutting interest rates as prices rose, a policy that was just revisited.

According to Seref Fayat, chairman of Turkey’s TOBB Clothing and the Apparel Industry Assembly, the cost of a Turkish-made t-shirt is now 40 % higher for European shoppers than one from Bangladesh. According to another source, the difference was between 15 and 20 % a few years back.

According to Fayat, fashion brands can tolerate higher rates up to 20 %, but anything higher results in market losses.

The new price, according to Timur Bozdemir, president of DF Manhattan Inc., which produces children’s clothing for the European and American markets, will only add 50 cents to a$ 10 t-shirt.

He said the adjustments reinforced the need for Turkey’s clothing industry to shift from large output to value-added, but he does not anticipate losing customers.

He declared,” We will undoubtedly lose if we insist on competing with Vietnam or Bangladesh for a$ 3 t-shirt.”

A Dynamic EDGE

Turkey was the fifth and sixth largest exporter in the world, between, last year, with exports of$ 14.4 billion in garments and$ 21.22 billion of clothing.

According to data from the European Union, European Apparel and Textile Confederation ( Euratex ), it is the second- and third-largest textile and clothing supplier to the region.

However, from 13.8 % in 2021 to 12.7 % last year, it lost market share in Europe.

American consumers turned to Turkey during the COVID- 19 pandemic to reduce freight charges amid offer disruptions.

When it ended, the mix of plunging delivery costs and rising home prices dulled its competitive advantage.

Textile and apparel imports fell more than 8 % through October this year, while total exports were straight, industry data shows.

The textile industry, facing a surge in cheaper imported materials and yarns which in piece sparked the need for the taxes, saw its range of registered people falling 15 % through August.

Its capacity utilisation rate was 71 % last month, compared to 77 % in manufacturing overall, and sector officials say the rate is near 50 % for many yarn manufacturers.

” I’ve nearly stopped output and cut most of the jobs in my fabric facility- and I’m not the only one in this condition”, said Fatih Bilici, who runs an Osmaniye- based yarn factory that supplies local and foreign markets.

His business cut normal production to 5 kilos from 50 kilos a few months ago. He said the taxes are important for an economy struggling to survive.

” It costs me$ 3.20/kg to manufacture, whereas my Uzbek rival sells it at$ 2.70. How can I may compete”?.

The lira has shed 35 % of its value to the dollar this year and 80 % over five years. But exporters say the lira should depreciate yet more to better reflect inflation that is running above 61 % and touched 85 % last year.

TOBB’s Fayat said the textile and apparel industry had cut 170, 000 tasks so far this year. As economic tightening dries an hot business, it is expected to hit 200, 000 by season- end. ( Additional reporting by Corina Rodriguez in Madrid, Helen Reid in London, Editing by Jonathan Spicer and Jan Harvey )

“” ,next_sibling” :]{ “msid”: 105459184″ ,title” :” Innerwear, athleisure companies still bet on sops to clear excess stock”” ,entity_type”:”ARTICLE”” ,link” :”/news/apparel- fashion/apparel/innerwear- athleisure- companies- still- bet- on- sops- to- clear- excess- stock/105459184″” ,category_name”: null” ,category_name_seo” :”apparel- fashion/apparel” }]” ,related_content” :]]” ,seoschemas”: false” ,msid”: 105459358″ ,entity_type”:”ARTICLE”” ,title” :”Turkey’s clothing makers face rising costs from push to help textile sector”” ,synopsis” :”Clothing officials say the new levies are squeezing the economy, which is among Turkey’s biggest companies, supplying heavy European brands such as H&M, Mango, Adidas, Puma and Inditex. “” ,titleseo” :”apparel- fashion/apparel/turkeys- clothing- makers- face- rising- costs- from- push- to- help- textile- sector”” ,status” :”ACTIVE”” ,authors” :]]” ,Alttitle”: { “minfo”:”” }” ,artag” :” Reuters”” ,artdate” :”2023- 11- 24 08: 26: 38″” ,lastupd” :”2023- 11- 24 08: 30: 06″” ,breadcrumbTags”: ]”textile sector”” ,clothing makers”” ,H&M “” ,Mango”” ,Adidas”” ,Puma””, Inditex” ]”,secinfo”: { “seolocation” :”apparel- fashion/apparel/turkeys- clothing- makers- face- rising- costs- from- push- to- help- textile- sector” }}” data- authors =” ]” data- category- name data- category_id data- date =”2023- 11- 24″ data- index =”article_1″ readability=”28.298989498712″>

Clothing officials say the new levies are squeezing the economy, which is among Turkey’s biggest companies, supplying heavy European brands such as H&M, Mango, Adidas, Puma and Inditex.

  • Updated On Nov 24, 2023 at 08: 30 AM IST
imageOn November 15, 2023, an employee at a cotton factory in Istanbul, Turkey, steel clothing. Umit Bektas/REUTERS”>
On November 15, 2023, an employee at a cotton factory in Istanbul, Turkey, steel clothing. Umit Bektas/REUTERS

Caglayan Ceyda

ISTANBUL,- Greek clothing manufacturers, the third-largest suppliers of apparel to Europe, claim that the government’s increased textile import taxes have caused them to experience higher production costs and run the risk of falling more behind their Eastern rivals.

Next week, Ankara increased tariffs on hundreds of inbound textile products by 30 to 100 % in an effort to support local yarn and fabric manufacturers who had been pleading for assistance against a wave of less expensive imports.

Clothing officials say the new levies are squeezing the economy, which is among Turkey’s biggest companies, supplying heavy European brands such as H&M, Mango, Adidas, Puma and Inditex.

According to industry representatives, job cuts may occur as transfer costs rise and Turkey producers lose market share to competitors like Bangladesh and Vietnam.

Essentially, exporters can apply for tax exemptions, but according to industry sources, the exemption process is expensive, time-consuming, and not effective for many businesses.

The industry was now dealing with rising inflation, declining desire, and lower profit margins brought on by what exporters view as an overvalued lira, as well as the results of Turkey’s years-long experiment with cutting interest rates as prices rose, a policy that was just revisited.

According to Seref Fayat, chairman of Turkey’s TOBB Clothing and the Apparel Industry Assembly, the cost of a Turkish-made t-shirt is now 40 % higher for European shoppers than one from Bangladesh. According to another source, the difference was between 15 and 20 % a few years back.

According to Fayat, fashion brands can tolerate higher rates up to 20 %, but anything higher results in market losses.

The new price, according to Timur Bozdemir, president of DF Manhattan Inc., which produces children’s clothing for the European and American markets, will only add 50 cents to a$ 10 t-shirt.

He said the adjustments reinforced the need for Turkey’s clothing industry to shift from large manufacturing to value-added, but he does not anticipate losing customers.

He declared,” We will undoubtedly lose if we insist on competing with Vietnam or Bangladesh for a$ 3 t-shirt.”

A Dynamic Advantage

Turkey was the fifth- and sixth-largest exporter in the world, respectively, last year, with exports of$ 14.4 billion in garments and$ 21.22 billion of clothing.

According to data from the European Union, European Apparel and Textile Confederation ( Euratex ), it is the second- and third-largest textile and clothing supplier to the region.

However, its share of the European market decreased from 13.8 % in 2021 to 12.7 % last year.

During the COVID-19 epidemic, American customers turned to Turkey to reduce freight costs due to supply issues.

When it ended, the mix of plunging delivery costs and rising home prices dulled its competitive advantage.

Market data shows that overall exports were straight through October of this year, but textile and apparel imports decreased by more than 8 %.

Through August, the number of registered people in the textile industry decreased by 15 % due to a rise in less expensive imported textiles and yarns, which in part sparked the need for the taxes.

Its capacity utilization rate was 71 % last month, down from 77 % overall in manufacturing, and according to industry experts, it is close to 50 % for many yarn manufacturers.

Fatih Bilici, the owner of an Osmaniye-based yarn shop that supplies domestic and international markets, said,” I’ve almost stopped output and cut most of the work in my fabric center. I’m not the only one in this position.

His business reduced everyday production from 50 kilos a few months ago to 5 kilos. He claimed that the levies are essential for a sector that is struggling to survive.

” Making it costs me$ 3.20 per kilogram, whereas my Uzbek competitor sells it for$ 2.70.” How am I supposed to compete? ……………………..

The lira has shed 35 % of its value to the dollar this year and 80 % over five years. But exporters say the lira should depreciate yet more to better reflect inflation that is running above 61 % and touched 85 % last year.

TOBB’s Fayat said the textile and apparel industry had cut 170, 000 tasks so far this year. As economic tightening dries an hot business, it is expected to hit 200, 000 by season- end. ( Additional reporting by Corina Rodriguez in Madrid, Helen Reid in London, Editing by Jonathan Spicer and Jan Harvey )

  • Published On Nov 24, 2023 at 08: 26 AM IST

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On November 15, 2023, an employee at a cotton factory in Istanbul, Turkey, steel clothing. Umit Bektas/REUTERS

Caglayan Ceyda

ISTANBUL: After the government increased taxes on textile imports, industry leaders claim that Turkey clothing manufacturers, the third-largest suppliers of clothes to Europe, now face higher manufacturing costs and run the risk of falling further behind their Asian rivals.

Next week, Ankara increased tariffs on hundreds of inbound textile products by 30 to 100 % in an effort to support local yarn and fabric manufacturers who had been pleading for assistance against a wave of less expensive imports.

Officials from Apple claim that the new fees are straining the sector, which is one of Turkey’s largest employers and provides lightweight German brands like H&amp, M, Mango, Adidas, Puma, and Inditex.

According to industry representatives, job cuts may occur as transfer costs rise and Turkey producers lose market share to competitors like Bangladesh and Vietnam.

Essentially, exporters can qualify for tax exemptions, but industry sources claim that the exemption process is expensive, time-consuming, and in practice does not work for some businesses.

The industry was now dealing with rising prices, declining require, and lower profit margins brought on by what exporters view as an overvalued lira, as well as the results of Turkey’s years-long experiment with cutting interest rates as prices rose, a policy that was just revisited.

According to Seref Fayat, chairman of Turkey’s TOBB Clothing and the Apparel Industry Assembly, the cost of a Turkish-made t-shirt is now 40 % higher for European shoppers than one from Bangladesh. According to another source, the difference was between 15 and 20 % a few years back.

According to Fayat, fashion brands can tolerate higher rates up to 20 %, but anything higher results in market losses.

The new price, according to Timur Bozdemir, president of DF Manhattan Inc., which produces children’s clothing for the European and American markets, will only add 50 cents to a$ 10 t-shirt.

He said the adjustments reinforced the need for Turkey’s clothing industry to shift from large output to value-added, but he does not anticipate losing customers.

He declared,” We will undoubtedly lose if we insist on competing with Vietnam or Bangladesh for a$ 3 t-shirt.”

A Dynamic EDGE

Turkey was the fifth and sixth largest exporter in the world, between, last year, with exports of$ 14.4 billion in garments and$ 21.22 billion of clothing.

According to data from the European Union, European Apparel and Textile Confederation ( Euratex ), it is the second- and third-largest textile and clothing supplier to the region.

However, from 13.8 % in 2021 to 12.7 % last year, it lost market share in Europe.

American consumers turned to Turkey during the COVID- 19 pandemic to reduce freight charges amid offer disruptions.

When it ended, the mix of plunging delivery costs and rising home prices dulled its competitive advantage.

Textile and apparel imports fell more than 8 % through October this year, while total exports were straight, industry data shows.

The textile industry, facing a surge in cheaper imported materials and yarns which in piece sparked the need for the taxes, saw its range of registered people falling 15 % through August.

Its capacity utilisation rate was 71 % last month, compared to 77 % in manufacturing overall, and sector officials say the rate is near 50 % for many yarn manufacturers.

” I’ve nearly stopped output and cut most of the jobs in my fabric facility- and I’m not the only one in this condition”, said Fatih Bilici, who runs an Osmaniye- based yarn factory that supplies local and foreign markets.

His business cut normal production to 5 kilos from 50 kilos a few months ago. He said the taxes are important for an economy struggling to survive.

” It costs me$ 3.20/kg to manufacture, whereas my Uzbek rival sells it at$ 2.70. How can I may compete”?.

The lira has shed 35 % of its value to the dollar this year and 80 % over five years. But exporters say the lira should depreciate yet more to better reflect inflation that is running above 61 % and touched 85 % last year.

TOBB’s Fayat said the textile and apparel industry had cut 170, 000 tasks so far this year. As economic tightening dries an hot business, it is expected to hit 200, 000 by season- end. ( Additional reporting by Corina Rodriguez in Madrid, Helen Reid in London, Editing by Jonathan Spicer and Jan Harvey )

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