ONE KNITTER MAILS ALERT ON RISING COSTS
Byline: M. McN.
NEW YORK — Fabrictex, a novelty knitter here doing $35 million a year, isn’t being shy about the possibility of price increases this year.
Rising costs — particularly in cotton — continue to put pressure on virtually every company in the textile industry, but it’s the smaller companies that are feeling it most acutely, said Edward Moskowitz, chairman and chief executive officer of Fabrictex.
Moskowitz said companies such as his — companies that do not have the flexibility provided by economies of scale and yet have a definite place in the market with a variety of niche and novelty products — may have to begin raising prices of their fabrics at some point this year.
So this week, Moskowitz will begin sending letters to his key retail and apparel manufacturing customers, informing them of the “seriousness and magnitude of the situation.”
As of Dec. 28, the price of a pound of cotton had risen to nearly 86 cents, up from about 67 cents on Oct. 31.
Fabrictex, with two knitting facilities in Lincolnton, N.C., specializes in cotton and Lycra spandex and other Lycra blends for sportswear, swimwear and activewear.
“We use hundreds of thousands of pounds of cotton per year, and the price rise is impacting us,” Moskowitz said. “Bigger companies may be able to absorb it a lot easier.”
While Moskowitz wouldn’t say how many letters he is sending, he noted, “They are going to our most valued customers in the retail and apparel manufacturing business.”
The letter said, in part, “This year’s domestic crop [of 19.5 million bales] is the largest ever and the best quality ever. China and Pakistan, the next largest producers, are suffering from low production and low quality because of insect infestation. Pakistan has already banned exports and will purchase in the world market. China is already a big purchaser.
“If China buys [probably this month], the price of cotton could go to 95 cents or to $1 a pound,” Moskowitz continued in his letter.
“…We are currently covered through February of this year and are currently negotiating for futures…For certain, our cotton fabric prices will increase as we come through this period…,” the letter concluded.
Moskowitz, in an interview, said he would continue to keep his key accounts posted on cotton prices, once February is over.
“We want to let our customers know that, because of the situation, we may have to take dramatic steps,” Moskowitz said. “But as we are taking those steps, we want to continue to let them know what is happening in the market.”