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Pitti Filati Mills Anticipate Slow Sales in ’08

High-end yarn producers at Pitti Filati expected to face an unsettled year in the face of a possible U.S. recession, higher wool prices and euro-dollar exchange rate woes.

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FLORENCE — High-end yarn producers at Pitti Filati expected to face an unsettled year in the face of a possible U.S. recession, higher wool prices and euro-dollar exchange rate woes.

The spinners showed their spring and summer 2009 yarn collections at the trade fair, which ran Jan. 30 to Feb. 1 at the Fortezza da Basso here.

Many said the unstable outlook for 2008 ruled out profit gains, and preliminary figures for the Italian yarn industry in 2007 cast a further shadow on the year’s prospects. According to Italian fashion and textile consortium SMI-ATI, sales dropped 1.8 percent to 3.36 billion euros, or $4.6 billion at average exchange, in 2007. The downturn came after a stable two-year period for the industry, though Italian yarn production has cumulatively dropped 35 percent since 2001.

Stefano Borsini, president of Igea, anticipated a tough year, but was holding out some hope for improvements.

“[This year] will be difficult but it could surprise us. Certainly profits will be greatly reduced,” said Borsini, adding that, if the spinner had not delocalized five years ago, “we wouldn’t exist today.”

Silvio Botto Poala, director of Botto Poala, said, “We were satisfied with 2006 and 2007, but we don’t know what 2008 will bring, most definitely a decrease in volume.”

Poala added that because of the Australian wool crisis, the raw fiber had undergone a 50 percent price increase in the past year and a half. As a result, the Biella-based spinner was forced to raise the price of its spun wool 20 percent per kilo. The boost has led Botto Poala to include new wool blends as part of its collection, including a wool and silk blend and a wool and cotton blend, as well as an ultracompact pure cashmere yarn in hues inspired by flowers.

Wool yarn specialist Lanerossi had also shaped its collection around blends of wool, silk, cotton and cashmere, in stark primary colors of green, red and yellow. Eugenio Piscopio, product manager, said the mill had raised prices 20 percent and for this reason he was hopeful that 2008 sales would total last year’s 100 million euros, or $137 million.

This story first appeared in the February 12, 2008 issue of WWD.  Subscribe Today.

Not all spinners expressed doom and gloom about prospects for the year.

“We have put all of our energy into creating a new collection of yarns that are more cohesive, that cater to our clients, so we are feeling positive about the future,” said Ilaria Taddeucci Sassolini, a member of the board of Lanificio dell’Olivo.

Many of the mill’s glossy, metallic-caged fancy cotton, viscose polyester and linen blend yarns were shown in contrasting fine and chunky gauges to offer customers more versatility, said Taddeucci Sassolini. She expected a small increase on last year’s turnover of 20 million euros, or $27.4 million.

Marchi & Fildi, a new company formed out of two family-owned Biella-based spinners last year, also remained enthusiastic about 2008.

“We have a renewed positive spirit because we are a new company,” said Caterina Dissegna, director of Marchi & Fildi. “Putting our heads together we have come up with many product ideas.”

The spinner showed its “ecotec” yarn, spun from recycled cotton and blended with either bamboo or acrylic, that has sold in the U.S. for seven years. Ecotec was unveiled again at Pitti for European clients that had just begun to appreciate ecological yarns, said Dissegna. The mill also showed a new organic cotton yarn called “biocot.”

Organic yarns spearheaded the fair’s trends. Almost every spinner offered its version, which one executive described as “absolutely necessary” to include in the collection.

Scottish firm Todd & Duncan showed an organic cashmere yarn using a fiber originating from goats that roam mountains in northern China.

Igea offered organic cotton and organic cotton and linen blend yarns. Both Todd & Duncan and Igea used traditional dyeing processes to achieve deep colors that organic dyes aren’t capable of attaining.

“We choose the color that’s less damaging to the environment, but when it comes to natural dyes I don’t want to kill thousands of butterflies just so I can get natural dye,” said Borsini.

Iafil, the cotton spinners that introduced an organic cotton to its collection three years ago, finessed its organic offer into a more luxury product, with finer counts that have began to catch the eye of luxury fashion houses, said a company representative.

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