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ReturnGuido Tettamanti speech on 2007 May European Silk Forum
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Guido Tettamanti's speech
---------------------------------------------------------------------
May 3, 2007
(France - Chateau de Pizay)
INTRODUCTION
The subject of my speech regards the international trade for silk fabrics since 2000.
We have a lot of information about this point.
We started 20 years ago in monitoring the foreign trade of the silk.
First of all as Ufficio Italiano Seta, then as Associazione Serica Italiana, then as SMI and finally with the fundamental support and finance of Stazione Sperimentale per la Seta.
The idea today is to exploit this information for our European Silk Forum.
We are taking care of the development of the Italian Trade since the Seventies.
During the Eighties we have begun to describe the developments in Europe, Japan, USA and Hong Kong.
Finally ten years ago we started with China and South Corea.
This overview has always been very interesting during the time.
It is fundamental to know exactly how things are going on, in order to define proper strategies.
This is fundamental for everybody but it is even more important for silk people, who cannot rely on precise information coming from China.
CHINA
Let’s start anyway with China.
China dominates the silk market in the world, as also slide 1 demonstrates.
SLIDE 1
The source is the official one of the People’s Republic of China.
Huge quantities, very important values and remarkable development, as you can see.
SLIDE 2
The development takes place everywhere.
In Europe first of all, with Italy as the most important market. It represents 65% of the quantity and 64% of the value, in 2006.
In Europe we find also France, with an import share of 10,5%; Turkey, 7,3%; Germany, 5,4%, Spain and U.K., both 3,6%.
In addition to direct sales of Chinese fabrics to the Italian market there is also a relevant flow of supplies coming to Italy through different E.U. member states, in free trade movement.
The overwhelming majority of the supplies is made of loomstate or boiled off fabrics, especially for Italy. There are also supplies of piece dyed, yarn dyed and printed, they are not so important, but they are increasing during the period.
Italy driving the overall development, because of its importance.
France and Turkey are improving their importance during the beginning of the century.
The most important development for Chinese exports takes place in Asia, where the bulk of the supplies goes.
SLIDE 3
This slide describes the incredible development of India.
In quantities, from 2,5 million metres of 2000 to 112 million metres of 2006.
Hong Kong is reducing its importance a little bit, probably because of the booming of direct sales from China to India. The quantity is around 30 million metres.
South Korea (25 million metres) and Japan ( 15 million metres ) are keeping their quantities but with some decline last year.
Pakistan is increasing a lot very recently, 27 million metres last year, it was nothing in 2000.
The overall development is driven by India.
USA drives the evolution in America, it represents 80% of the market.
ITALY
SLIDE 4
Let’s consider the situation for Italy and it is very interesting.
We see a decline at the beginning of this century, but with a good recovery in 2005 and 2006.
We have increased 45% in quantity and 26% in value in comparison with 2003, which was the worst year.
SLIDES 5 AND 6
Where has this development taken place?
Mainly in Europe, the increase is 62% in quantity and 40% in value in relation with 2003.
In Europe the most important news is the growing importance of Spain: more than doubled in value, from 217 tons in 2000 to 457 tons in 2006.
France is always very very important. In value it grows 37% , in comparison with 2003, and it is improving also in quantity (227 tons in 2000, 297 tons last year).
Germany on the contrary declines sharply, collapsing at the beginning of the period, with some recovery more recently.
The quantities have decreased from 304 tons in 2000 to 182 tons in 2003, last year they were 364 tons. It is strange, but this is official figure.
UK also has lost most of its importance, in this case not only for values, but also for quantities (from 213 to 98 tons only).
In the meanwhile East Europe was 144 tons, 7 million euro in 2000 and has reached 403 tons and 27 million euro in 2006.
Good news from Asia, which shows an increase during the period, but with a new situation in respect of 2000.
In 2000 the import share of Japan on Asian market was 56%,in 2006 it is 35%.
Japan is declining, it has lost 32% during the period in terms of value.
In the meanwhile in 2006 China and Hong Kong, together, represent 30% of Asian market. They were even able to go over Japan in 2005. In 2000 this percentage was less than 16%.
Middle East has increased from 12,4 % to 18 % last year.
South Korea was 5,2% in 2000, it is 6% 2006, thanks to a very good recovery.
The US market on the contrary is suffering a lot.
You can see the value in slide 6, the quantity was 434 tons in 2000 and only 256 tons last year.
Decline also in Canada and no substantial progress in South America.
FRANCE
SLIDE 7
I must thank, first of all, my colleagues of UNITEX Lyon, who have given the statistics.
In this case, unfortunately, the figures of 2006 were not available yet.
So we shall focus on 2005 as the latest year.
The development in France is quite similar to the Italian one.
We see a collapse after 2000, France decreases to its lowest level around 2002-2003, than there is a very good recovery.
The recovery is faster than in Italy, but France is 25% of Italian quantities and about 21-23% of Italian values. Lighter means also faster.
SLIDE 8 AND 9
Europe is good for France, it improves 13% in quantity and 10% in values, but with impressive increase after 2004.
The most important market is Italy.
Italy declines sharply during the period, but it has a very good recovery in 2005.
The quantities fell from 106 tons in 2000 to 34 tons in 2003, then they grow again to 129 tons in 2005.
If we look at the average price it starts from 85 euro in 2000, than it doubles when the quantities collapse, then it goes down again when the quantities become again bigger.
The Italian statistics show that Italy receives also cheap grey clothes from France. Their price is Chinese. So the French exports to Italy comprise both French fabrics and Chinese ones.
Germany is declining, as we have already seen for Italy, both in value, as you can see in slide 9, and also in quantity (63 tons in 2000, only 11 in 2004).
Spain has a development which is similar to the one that we have already described for Italy. It goes from 14 tons in 2000 to 35 tons in 2005, with a good progress especially last year( the source in this case is Eurostat).
UK was 83 tons in 2000,very important for France, but then it collapses to 15 tons in 2004 and 19 tons in 2005.
Romania was 9 tons in 2000, it reaches 54 tons in 2005. Hungary starts 25 and reaches 32 at the end of the period. Poland from 13 to 40. Even for France, not only for Italy, the development of east Europe is staggering.
Asia goes up during the worst years (2002-2003), reaching the highest point in 2003.
Then it goes down to a level which is a little bigger than 2000.
The Middle East is quite important , Saudi Arabia and U A E reach 11 tons in 2002, 2003 and 2004, then decrease to 6 tons.
Japan is declining, as we already have seen for Italy, from 15 tons in 2000 to 5 tons in 2005.
USA is a small market for France, just for a small quantity of very expensive fabrics. It is suffering, but less than the way we have seen in Italy.
Madagascar and Morocco are very important for shipping of fabrics which are cut and hemmed and then come back to Europe as scarves.
Morocco is improving the value. The quantities fall from 46 in 2000 to 26 tons in 2002, then they jump from 34 tons in 2004 to 71 tons in 2005.
Madagascar falls also from 46 tons in 2000 to 37 tons, in 2002, then it goes up again in 2004-2005 to 47 tons.
INDIA
We have been able to buy the official statistics of India, from the Governmental agency, just for this presentation.
It is the first time that we deal with these figures .
We were really willing to see the developments of the second giant of the world of the silk.
We are quite disappointed, the information is not reliable.
Slide 10
As you can see the quantities in 2003 are booming, but the values are not following the quantities. This is not realistic.
We have asked for explanation to our source, but no substantial explanation is possible, the reaction is that the figures are official and that’s all.
Another point is the fact that the fiscal year in India starts april 1° and the statistics act accordingly.
Slide 11 and 12
We have seen Chinese exports shipped mainly to Asia.
We have seen the importance of European market for Italy and France.
India sells its fabrics everywhere, with a good distribution among Asia, America and Europe.
Europe is performing better than Asia and America ( index 134).
There is no a real leading country in Europe, several countries are quite important.
In slide 12 we point out Italy, United Kingdom and Germany.
The most important market is UK, with a good development in values and in quantities ( 3,7 million metres in 2006 )
Germany is suffering, as we have already seen for Italy and France, the quantity is approximately 1,8 million metres.
Italy is better, in this case with a quantity around 2 million metres, but the market suffers a lot in 2006.
For your information Spain has the same value of Germany, with a quantity of 2 million metres. It also has a remarkable drop in 2006.
France is a little less than 1 million metres.
Asia is loosing some ground, from 100 to 87.
Hong Kong is the most important market, it has a very good situation during the period but it collapses in 2006 ( only 1 million metres, it was 3,6 million metres the year before but it reached even 4,9 million metres during the period ).
Another good market in the Far East is Singapore, approximately 1,2 million metres, it is also suffering in 2006.
No direct sales to Pakistan.
China, Japan, Korea are not so significant as we are used to see for other suppliers and they are not increasing.
The Middle East is quite relevant, especially United Arab Emirates, with a good increase ( more than 2 million metres ).
Another 2 million metres go to Saudi Arabia and other countries in this area.
America substantially means United States, which is the most important market for India.
The supplies develop, the quantities reach 13,3 million metres in 2004, then they drop to 12 million metres in 2006, but India is by far the most important supplier of silk fabrics for the U S market, it is more important than China, Italy and South Korea.
SOUTH KOREA
SLIDE 13
We have seen huge increases for China and India, different developments in France and Italy, what we see in South Korea is a clear decline.
During the period the quantities are reduced 20%, the values 38%, no substantial recovery after 2003, a new loss in 2006.
SLIDE 14-15
Where are Korean fabrics going and where is the collapse taking place?
Traditionally South Korea was a great supplier mainly for US markets.
If we take a look to US statistics, we realize how sharp is the decrease in this market.
The reduction is 60% in value and 46% in quantity (from 630 to 340 tons).
The situation in Asia is not positive at all, with a reduction of 28% in quantity, 42% in value.
Japan is even worse than USA.
In 2006 only 19% of Korean supplies remain in relation with 2000, but we can estimate that this level represents only 3% of Korean supplies of 1994 and 1995.
China is showing some improvement, but if we add China and Hong Kong the global amount is not positive, even if improving at the end of the period, in comparison with 2002 – 2003.
Middle East is very important for South Korea and finally this trend is growing, especially with Saudi Arabia.
What about Europe?
The Korean sales to our market are not so important.
They have declined both in quantity and in value.
They mainly go to UK (13 tons), France (7 tons), Spain (5 tons).
Slide 16
This slide makes a summary of the evolution of the four major suppliers of silk fabrics in the world.
As explained above, no information is available for France in 2006.
China is the most important supplier and it has shown the best increase during the period.
India also has improved and is going to surpass Italy as second supplier, also in value.
Italy is keeping its values and has increase the quantities, in relation with 2003.
South Korea is declining, both in quantity and in values.
Slide 17
This slide shows the development of the four suppliers in the main geographical areas.
Source:Industry Website
---------------------------------------------------------------------
May 3, 2007
(France - Chateau de Pizay)
INTRODUCTION
The subject of my speech regards the international trade for silk fabrics since 2000.
We have a lot of information about this point.
We started 20 years ago in monitoring the foreign trade of the silk.
First of all as Ufficio Italiano Seta, then as Associazione Serica Italiana, then as SMI and finally with the fundamental support and finance of Stazione Sperimentale per la Seta.
The idea today is to exploit this information for our European Silk Forum.
We are taking care of the development of the Italian Trade since the Seventies.
During the Eighties we have begun to describe the developments in Europe, Japan, USA and Hong Kong.
Finally ten years ago we started with China and South Corea.
This overview has always been very interesting during the time.
It is fundamental to know exactly how things are going on, in order to define proper strategies.
This is fundamental for everybody but it is even more important for silk people, who cannot rely on precise information coming from China.
CHINA
Let’s start anyway with China.
China dominates the silk market in the world, as also slide 1 demonstrates.
SLIDE 1
The source is the official one of the People’s Republic of China.
Huge quantities, very important values and remarkable development, as you can see.
SLIDE 2
The development takes place everywhere.
In Europe first of all, with Italy as the most important market. It represents 65% of the quantity and 64% of the value, in 2006.
In Europe we find also France, with an import share of 10,5%; Turkey, 7,3%; Germany, 5,4%, Spain and U.K., both 3,6%.
In addition to direct sales of Chinese fabrics to the Italian market there is also a relevant flow of supplies coming to Italy through different E.U. member states, in free trade movement.
The overwhelming majority of the supplies is made of loomstate or boiled off fabrics, especially for Italy. There are also supplies of piece dyed, yarn dyed and printed, they are not so important, but they are increasing during the period.
Italy driving the overall development, because of its importance.
France and Turkey are improving their importance during the beginning of the century.
The most important development for Chinese exports takes place in Asia, where the bulk of the supplies goes.
SLIDE 3
This slide describes the incredible development of India.
In quantities, from 2,5 million metres of 2000 to 112 million metres of 2006.
Hong Kong is reducing its importance a little bit, probably because of the booming of direct sales from China to India. The quantity is around 30 million metres.
South Korea (25 million metres) and Japan ( 15 million metres ) are keeping their quantities but with some decline last year.
Pakistan is increasing a lot very recently, 27 million metres last year, it was nothing in 2000.
The overall development is driven by India.
USA drives the evolution in America, it represents 80% of the market.
ITALY
SLIDE 4
Let’s consider the situation for Italy and it is very interesting.
We see a decline at the beginning of this century, but with a good recovery in 2005 and 2006.
We have increased 45% in quantity and 26% in value in comparison with 2003, which was the worst year.
SLIDES 5 AND 6
Where has this development taken place?
Mainly in Europe, the increase is 62% in quantity and 40% in value in relation with 2003.
In Europe the most important news is the growing importance of Spain: more than doubled in value, from 217 tons in 2000 to 457 tons in 2006.
France is always very very important. In value it grows 37% , in comparison with 2003, and it is improving also in quantity (227 tons in 2000, 297 tons last year).
Germany on the contrary declines sharply, collapsing at the beginning of the period, with some recovery more recently.
The quantities have decreased from 304 tons in 2000 to 182 tons in 2003, last year they were 364 tons. It is strange, but this is official figure.
UK also has lost most of its importance, in this case not only for values, but also for quantities (from 213 to 98 tons only).
In the meanwhile East Europe was 144 tons, 7 million euro in 2000 and has reached 403 tons and 27 million euro in 2006.
Good news from Asia, which shows an increase during the period, but with a new situation in respect of 2000.
In 2000 the import share of Japan on Asian market was 56%,in 2006 it is 35%.
Japan is declining, it has lost 32% during the period in terms of value.
In the meanwhile in 2006 China and Hong Kong, together, represent 30% of Asian market. They were even able to go over Japan in 2005. In 2000 this percentage was less than 16%.
Middle East has increased from 12,4 % to 18 % last year.
South Korea was 5,2% in 2000, it is 6% 2006, thanks to a very good recovery.
The US market on the contrary is suffering a lot.
You can see the value in slide 6, the quantity was 434 tons in 2000 and only 256 tons last year.
Decline also in Canada and no substantial progress in South America.
FRANCE
SLIDE 7
I must thank, first of all, my colleagues of UNITEX Lyon, who have given the statistics.
In this case, unfortunately, the figures of 2006 were not available yet.
So we shall focus on 2005 as the latest year.
The development in France is quite similar to the Italian one.
We see a collapse after 2000, France decreases to its lowest level around 2002-2003, than there is a very good recovery.
The recovery is faster than in Italy, but France is 25% of Italian quantities and about 21-23% of Italian values. Lighter means also faster.
SLIDE 8 AND 9
Europe is good for France, it improves 13% in quantity and 10% in values, but with impressive increase after 2004.
The most important market is Italy.
Italy declines sharply during the period, but it has a very good recovery in 2005.
The quantities fell from 106 tons in 2000 to 34 tons in 2003, then they grow again to 129 tons in 2005.
If we look at the average price it starts from 85 euro in 2000, than it doubles when the quantities collapse, then it goes down again when the quantities become again bigger.
The Italian statistics show that Italy receives also cheap grey clothes from France. Their price is Chinese. So the French exports to Italy comprise both French fabrics and Chinese ones.
Germany is declining, as we have already seen for Italy, both in value, as you can see in slide 9, and also in quantity (63 tons in 2000, only 11 in 2004).
Spain has a development which is similar to the one that we have already described for Italy. It goes from 14 tons in 2000 to 35 tons in 2005, with a good progress especially last year( the source in this case is Eurostat).
UK was 83 tons in 2000,very important for France, but then it collapses to 15 tons in 2004 and 19 tons in 2005.
Romania was 9 tons in 2000, it reaches 54 tons in 2005. Hungary starts 25 and reaches 32 at the end of the period. Poland from 13 to 40. Even for France, not only for Italy, the development of east Europe is staggering.
Asia goes up during the worst years (2002-2003), reaching the highest point in 2003.
Then it goes down to a level which is a little bigger than 2000.
The Middle East is quite important , Saudi Arabia and U A E reach 11 tons in 2002, 2003 and 2004, then decrease to 6 tons.
Japan is declining, as we already have seen for Italy, from 15 tons in 2000 to 5 tons in 2005.
USA is a small market for France, just for a small quantity of very expensive fabrics. It is suffering, but less than the way we have seen in Italy.
Madagascar and Morocco are very important for shipping of fabrics which are cut and hemmed and then come back to Europe as scarves.
Morocco is improving the value. The quantities fall from 46 in 2000 to 26 tons in 2002, then they jump from 34 tons in 2004 to 71 tons in 2005.
Madagascar falls also from 46 tons in 2000 to 37 tons, in 2002, then it goes up again in 2004-2005 to 47 tons.
INDIA
We have been able to buy the official statistics of India, from the Governmental agency, just for this presentation.
It is the first time that we deal with these figures .
We were really willing to see the developments of the second giant of the world of the silk.
We are quite disappointed, the information is not reliable.
Slide 10
As you can see the quantities in 2003 are booming, but the values are not following the quantities. This is not realistic.
We have asked for explanation to our source, but no substantial explanation is possible, the reaction is that the figures are official and that’s all.
Another point is the fact that the fiscal year in India starts april 1° and the statistics act accordingly.
Slide 11 and 12
We have seen Chinese exports shipped mainly to Asia.
We have seen the importance of European market for Italy and France.
India sells its fabrics everywhere, with a good distribution among Asia, America and Europe.
Europe is performing better than Asia and America ( index 134).
There is no a real leading country in Europe, several countries are quite important.
In slide 12 we point out Italy, United Kingdom and Germany.
The most important market is UK, with a good development in values and in quantities ( 3,7 million metres in 2006 )
Germany is suffering, as we have already seen for Italy and France, the quantity is approximately 1,8 million metres.
Italy is better, in this case with a quantity around 2 million metres, but the market suffers a lot in 2006.
For your information Spain has the same value of Germany, with a quantity of 2 million metres. It also has a remarkable drop in 2006.
France is a little less than 1 million metres.
Asia is loosing some ground, from 100 to 87.
Hong Kong is the most important market, it has a very good situation during the period but it collapses in 2006 ( only 1 million metres, it was 3,6 million metres the year before but it reached even 4,9 million metres during the period ).
Another good market in the Far East is Singapore, approximately 1,2 million metres, it is also suffering in 2006.
No direct sales to Pakistan.
China, Japan, Korea are not so significant as we are used to see for other suppliers and they are not increasing.
The Middle East is quite relevant, especially United Arab Emirates, with a good increase ( more than 2 million metres ).
Another 2 million metres go to Saudi Arabia and other countries in this area.
America substantially means United States, which is the most important market for India.
The supplies develop, the quantities reach 13,3 million metres in 2004, then they drop to 12 million metres in 2006, but India is by far the most important supplier of silk fabrics for the U S market, it is more important than China, Italy and South Korea.
SOUTH KOREA
SLIDE 13
We have seen huge increases for China and India, different developments in France and Italy, what we see in South Korea is a clear decline.
During the period the quantities are reduced 20%, the values 38%, no substantial recovery after 2003, a new loss in 2006.
SLIDE 14-15
Where are Korean fabrics going and where is the collapse taking place?
Traditionally South Korea was a great supplier mainly for US markets.
If we take a look to US statistics, we realize how sharp is the decrease in this market.
The reduction is 60% in value and 46% in quantity (from 630 to 340 tons).
The situation in Asia is not positive at all, with a reduction of 28% in quantity, 42% in value.
Japan is even worse than USA.
In 2006 only 19% of Korean supplies remain in relation with 2000, but we can estimate that this level represents only 3% of Korean supplies of 1994 and 1995.
China is showing some improvement, but if we add China and Hong Kong the global amount is not positive, even if improving at the end of the period, in comparison with 2002 – 2003.
Middle East is very important for South Korea and finally this trend is growing, especially with Saudi Arabia.
What about Europe?
The Korean sales to our market are not so important.
They have declined both in quantity and in value.
They mainly go to UK (13 tons), France (7 tons), Spain (5 tons).
Slide 16
This slide makes a summary of the evolution of the four major suppliers of silk fabrics in the world.
As explained above, no information is available for France in 2006.
China is the most important supplier and it has shown the best increase during the period.
India also has improved and is going to surpass Italy as second supplier, also in value.
Italy is keeping its values and has increase the quantities, in relation with 2003.
South Korea is declining, both in quantity and in values.
Slide 17
This slide shows the development of the four suppliers in the main geographical areas.
Source:Industry Website
