Aurora Specialty Textiles Group, Inc., a global leader in coating, dyeing and finishing of woven, non-woven and knit fabrics, has proven that resilience and an innovative spirit can propel a company to new heights, even during one of the most challenging times in the industry’s history.
Aurora was originally founded as a cloth prep facility in Aurora, Illinois in 1883. The company has since evolved and flourished as a domestic manufacturer, transitioning first into textile dyeing and finishing in the 1920s, then into textile coating capabilities in the 1950s.
In 1977, Aurora was purchased by Meridian Industries, Inc., a privately owned manufacturing holding company comprised of five operating entities, including Majilite, Meridian Specialty Yarn Group, Inc., Kleen Test Products Corporation, and Kent Elastomer Products Inc.
The company continued to expand through the following decades and in 2015 invested in a new state-of-the-art, wide-width coating and finishing line and a new facility in Yorkville, Illinois that dramatically expanded their ability to serve customers and new markets.
Today, Aurora offers a complete portfolio of products, including digitally-printable textiles, specialty home products, tape-backing products and technical textiles for a wide variety of industries.
Aurora President Marcia Ayala, who joined Aurora in 2006 and was named president in 2019, is leading the company on a rebranding drive, while also navigating myriad challenges, from rising raw material prices and transportation costs to a global supply chain crisis.
“The company has rebranded itself and really expanded and grown from the point of view of its manufacturing capabilities,” Ayala said.
As part of the rebranding effort, Aurora has engaged heavily on social media channel LinkedIn, posting company news and updates weekly. In addition, Aurora is currently in the process of upgrading its website.
“It has made a difference,” Ayala noted. “We do see that we are getting more inquiries as a result of our presence and engagement on LinkedIn.”
These initiatives have helped Aurora maintain and grow business in an uneven economy roiled by the COVID-19 pandemic that has impacted the entire U.S. manufacturing and retail sectors.
Aurora’s product offerings and services are extensive.
The company’s products cover a wide range of applications, from pressure sensitive tapes with a fabric backing, like gaffer’s and athletic tapes, to digitally printable textile applications such as canvases, banners and window displays and wall coverings. Other applications include power transmission belting, military, abrasives, healthcare and safety, and protective outdoor coverings.
In addition, Aurora has a range of textile finishing capabilities including fabric preparations such as bleaching, scouring, singeing and brushing/vacuuming; dyeing capabilities; pad applications to apply treatments such as fire retardant, water-repellent and anti-microbial; coating capabilities for a range of water-based coatings; and calendering, sanding and converting services.
Navigating the Pandemic, Rising Raw Material Costs and a Global Supply Chain Crisis
“Like many businesses, when the pandemic first hit, our business slowed considerably and was down in 2020,” Ayala said. “While we hunkered down, we continued to manufacture throughout the pandemic. We never shut down.”
Ayala said Aurora had some businesses that were resilient and remained consistent throughout the pandemic, though areas such as athletic tape and gaffer’s tape were impacted as sporting events and entertainment shut down at the height of the pandemic in 2020.
Demand and business rebounded in 2021, but with it came a whole new set of challenges triggered by a global supply chain crisis that has resulted in skyrocketing costs for freight, cargo, raw materials and chemicals.
“Transportation costs alone have doubled and tripled depending on where you are shipping it from,” Ayala said. “The challenge now is mitigating price increases as much as we can and meeting customer demand.”
“We have had to change the way we do business because of rising prices and longer lead times for raw materials. We implemented a longer time frame for forecasting and customer product demands, we are qualifying secondary suppliers, and we are requoting prices frequently due to the volatile and increasing prices of raw materials,” she added. “In some cases, we have been told from our suppliers that prices are only good for 24 hours. It has been going on for the past year and I don’t see any end in sight in the near future.”
But one challenge Aurora has managed to dodge is the labor shortage crisis that has plagued broad swaths of the manufacturing and retail sectors. Aurora employs 73 people and operates in a 120,000 square-foot facility.
“We have had very little turnover, across the board. Most of the turnover has been retirements. I think people enjoy working here and we have a very good culture focused on employee engagement, continuous improvement and input on ideas,” Ayala noted.
Emerging Markets
Looking ahead, Aurora hopes to expand its offerings to the military market: “We are looking at how we can act as a subcontractor to companies that need fabric finishing or coatings, like durable water repellants or anti-microbial finishes. This is a business that we have already grown, and we are looking to expand it,” she said.
She said government procurement business under the Berry amendment is extremely important and is a topic that will be highlighted on Aurora’s newly designed website.
“Our sweet spot is Berry compliant business where we offer our coatings, bleaching, and finishing services to companies that already have fabric procured, and we can add value,” Ayala said.
“Another area Aurora is exploring, one that would fit well with its core competencies, is outdoor protective fabrics for end products like boat covers and canopies, where it can offer a wide range of polyurethane coatings or water resistance coatings,” she added.
Sustainability
Aurora, a Meridian Industries, Inc. company, is ISO 9001 and ISO 14001 certified, and an industry leader in sustainable manufacturing practices.
The company moved into its state-of-the-art facility in 2015 and has made a significant investment on sustainability upgrades at its plant in Yorkville.
Among the upgrades to Aurora’s new facility, the natural gas and electricity components were designed to significantly reduce its manufacturing carbon footprint.
The move from its original plant in Aurora to the new plant in Yorkville led to a reduction in natural gas and electricity consumption of 4,134 metric tons of CO2. That is the equivalent of 465,178 gallons of gasoline per year or 4,523,015 pounds of coal burned, according to the company.
Over $1 million was invested in new equipment alone, including Variable Speed Drives to adjust motor speed to match demand (to prevent operating equipment running at constant full speeds), new higher efficiency boilers powered by gas, and a Building Automation System (BAS) that allows the company to schedule equipment to turn on and off automatically through a central computer, which helps reduce energy consumption.
As members of the Valley Industrial Association (VIA), which serves manufacturers throughout Northern Illinois, Aurora said it has begun sharing its sustainability management ideas with other manufacturing operations in the region and is helping them to identify ways to save energy and water resources and also reduce waste.
Aurora is a finalist in all six VIA benchmark categories, including innovation, culture, operations, safety, social responsibility and workforce development. The VIA’s “Spark Awards” will be held on April 27.
Onshoring/Nearshoring
Ayala said she is very supportive of onshoring more weaving and manufacturing.
“It has been an advantage for us to be a domestic manufacturer, because of the global supply chain crisis and the issues with imported products over the past two years,” she noted. “People are starting to see more value in having domestic suppliers because of reliability, a shorter supply chain and lower costs from a transportation perspective.”
Ayala said her customers also find value in promoting products that they can label as manufactured in the U.S.
She said free trade agreements, such as the U.S.-Mexico-Canada Agreement (USMCA) have been beneficial and led to new exports to Canada, though over 90 percent of Aurora’s products and services are consumed domestically.
“Free trade agreements spur more domestic production of fabrics and yarns,” Ayala said.
Aurora hosted U.S. Trade Representative Katherine Tai and Congresswoman Lauren Underwood (D-Ill.) on a tour of its facility and a roundtable discussion featuring women-led manufacturing firms and union representatives in late August last year. The event was hosted by Ayala and Bruce Pindyck, chairman and CEO of Meridian Industries, Aurora’s parent company.
The visit came at a critical time as Congress was debating the bipartisan Infrastructure Investment and Jobs Act. The bill, which Congress ultimately passed, includes support across Illinois communities for public transit, improvements to roads and bridges, and improved passenger and freight rail and programs.
“The fact that Ambassador Tai was willing to visit small manufacturing companies like ours and talk to us about what is important to us was impressive,” Ayala said.
“When we went on the plant tour, she was interested in our manufacturing capabilities and asked questions about what was impacting our business and how trade policy impacts our business.”
“I asked her if it was typical for a U.S. trade representative to come on a tour of a small company and talk trade policy and she said it was her own innovation and practice—to meet with manufacturers and workers around the country—instead of putting out trade policies without asking industry first how it would impact us,” Ayala said. “That made such an impression.”
U.S. Textile Executives Discuss Substantive Policy Priorities with U.S. Trade Representative Sarah Bianchi at New England Roundtable
/in TIN Blog /by Kristi EllisDuring her tour of Shawmut Corp., a fourth-generation, family-run global advanced materials and textile manufacturer, Ambassador Bianchi learned first-hand about a company that has contributed greatly to U.S. PPE efforts, investing $20 million in a new facility, which can produce up to 180 million NIOSH-approved N95 respirators and other PPE annually, creating hundreds of new local jobs.
Ambassador Bianchi’s visit marked a rare opportunity for executives to highlight the critical need for policies supporting a domestic supply chain that is a major contributor to: the overall U.S. economy with $64.4 billion in textile and apparel shipments in 2020; high-tech innovation, such as heart valves and stents, aircraft bodies and advanced body armor; and our national defense, supplying over 8,000 products a year to warfighters.
The roundtable also facilitated a discussion on key policy priorities, including the importance of policies and incentives aimed at maintaining a domestic personal protective equipment (PPE) production base, the importance of the Berry Amendment, the commitment by the industry to sustainability, and the critical nature of the Western Hemisphere co-production relationship, which supports 1 million U.S. and regional textile and apparel workers.
“We look forward to working closely with Ambassador Bianchi and the U.S. Trade Representative’s [USTR] office to advance policies that bolster domestic production by expanding buy American policies and providing incentives for onshoring and nearshoring production, while addressing illegal trade practices that undermine our industry’s competitiveness head on,” said NCTO President and CEO Kim Glas, who led the roundtable discussion, in a news release.
Deputy U.S. Trade Representative Sarah Bianchi visits Shawmut Corporation; Participates in New England Textile Industry Roundtable
/in Press Releases, Recent News /by Kristi EllisWASHINGTON – Shawmut Corporation hosted Deputy United States Trade Representative Sarah Bianchi today at the company’s headquarters and state-of-the-art manufacturing facility in West Bridgewater, Mass., as part of the ambassador’s inaugural visit to textile manufacturing facilities in the New England area.
Ambassador Bianchi’s visit comes at a pivotal time for the U.S. textile supply chain, which produced $64 billion in output in 2020 and employed nearly 530,000 workers. Shawmut Corporation is part of the broader U.S. textile industry that has been at the forefront of a domestic production chain that has collectively manufactured over one billion personal protective equipment (PPE) items during the COVID-19 pandemic.
The ambassador’s visit to Shawmut included a tour of the company’s manufacturing facility and a roundtable discussion highlighting the critical need for policies supporting a domestic supply chain and the innovative nature of the modern textile industry and its important contribution to the U.S. economy. Shawmut, a fourth-generation, family-run global advanced materials and textile manufacturer, is a global leader in automotive textile composites, innovative technical fabrics and custom laminating services, employing more than 700 employees worldwide with 10 global manufacturing plants and seven commercial offices. The company has also contributed greatly to U.S. PPE efforts, investing $20 million in a new state-of-the-art facility, which can produce up to 180 million NIOSH-approved N95 respirators and other PPE annually and created hundreds of new local jobs.
“We are honored to have hosted Ambassador Bianchi at our West Bridgewater facility on her first domestic industry trade visit,” said Shawmut CEO James Wyner. “The opportunity to discuss with the USTR office the impact of our nation’s global trade policies on the valuable and passionate work our U.S. manufacturing teams provide to their local communities, U.S.-based trade partners and the nation is critical to supporting a robust U.S. supply chain. We are thankful for Ambassador Bianchi’s commitment to understanding the challenges we face on a global scale by her visit and dialogue here today.”
Ambassador Bianchi said, “Today’s tour of Shawmut’s manufacturing facilities and the roundtable discussion with textile industry executives was an invaluable opportunity for me to see innovative U.S. textile manufacturing first-hand, to learn more about the challenges that U.S. textile manufacturing faces, and to explore ways in which the Administration and industry can cooperate to support a worker-centric trade policy.”
During the visit, U.S. textile executives spanning the fiber, yarn, fabric, and finished product textile and apparel industries participated in a roundtable with the ambassador at which they discussed the innovative achievements and competitiveness of the domestic industry and outlined priority issues in Washington, such as the importance of Buy American and Berry Amendment government procurement policies, maintaining strong rules of origins in free trade agreements and the need to address larger systemic trade issues with China.
National Council of Textile Organizations (NCTO) President and CEO Kim Glas said, “We deeply appreciate Ambassador Bianchi’s inaugural visit to New England to meet with U.S. textile executives and engage in substantive discussions centered around policy opportunities that help bolster U.S. manufacturing and the challenges confronting our industry. The U.S. textile industry is an extremely diverse, technically advanced and highly innovative industry that provides much-needed jobs in rural areas across the country. Sound trade policies and enforcement are essential to this manufacturing sector and its workforce.”
Glas continued: “We are grateful to Ambassador Bianchi and the entire U.S. Trade Representative’s (USTR) office, led by Ambassador Katherine Tai, for reaffirming its support of CAFTA-DR rules and acknowledging the importance of the co-production chain with our Western Hemisphere trade partners. We look forward to working closely with Ambassador Bianchi and the USTR office to advance policies that bolster domestic production by expanding buy American policies and providing incentives for onshoring and nearshoring production, while addressing illegal trade practices that undermine our industry’s competitiveness head on.”
About Shawmut Corporation
Founded in 1916, Shawmut Corporation is a fourth-generation, family-run, global company with locations in North America, Europe, and Asia. Shawmut uses materials innovation to improve people’s lives, employing expertise in fabric formation, coating and laminating to deliver high performance materials and components to the global Automotive, Health & Safety, Military & Protective, and Custom Laminating Solutions markets, and is the largest independent laminator in the U.S. for technical fabrics. Shawmut Corporation is based in West Bridgewater, Mass., and can be found online on LinkedIn, Facebook and, Instagram. To learn more, visit www.shawmutcorporation.com.
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NCTO is a Washington, DC-based trade association that represents domestic textile manufacturers.
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Press Contacts:
NCTO
Kristi Ellis
(202) 281-9305
kellis@ncto.org
Shawmut Corp.
Jon Platz
(781)223-4112
jplatz@shawmutcorporation.com
NCTO Welcomes Appointment of Jennifer Knight as Deputy Assistant Secretary for Textiles, Consumer Goods and Materials at the U.S. Department of Commerce
/in Press Releases /by Kristi EllisWASHINGTON, D.C. — National Council of Textile Organizations (NCTO) President and CEO Kim Glas, representing the full spectrum of U.S. textiles from fiber through finished sewn products, issued a statement today welcoming the appointment of Jennifer Knight as Deputy Assistant Secretary for Textiles, Consumer Goods and Materials at the U.S. Department of Commerce.
Knight will oversee the Office of Textiles and Apparel (OTEXA), the Office of Materials Industries and the Office of Consumer Goods within the International Trade Administration’s Industry and Analysis unit.
Statement from NCTO President and CEO Kim Glas:
We applaud the Biden administration for appointing Jennifer Knight to serve as the Deputy Assistant Secretary for Textiles, Consumer Goods and Materials.
Jennifer’s extensive and successful career in U.S. textile manufacturing, as well as her experience in setting up international operations in regions such as Central America, is an enormous asset as she takes on this critical role.
As onshoring and nearshoring efforts gain momentum amidst the global supply chain crisis, Jennifer’s appointment could not have come at a more pivotal time. We couldn’t be more delighted with her appointment and strong familiarity with our sector and beyond. Jennifer will be a strong advocate for American workers and industries, and we look forward to working with her on the U.S. textile industry’s top priorities in the months and years ahead.
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NCTO is a Washington, DC-based trade association that represents domestic textile manufacturers.
Werner International Report Highlights Benefits of U.S.-CAFTA-DR Agreement and Devastating Impact of Weakening Agreement’s Rules
/in TIN Blog /by Kristi EllisThe National Council of Textile Organizations (NCTO) commissioned a critical report by Werner International examining the valuable economic and societal impact of the U.S.-Dominican Republic-Central America Free Trade Agreement (CAFTA-DR, which has spawned an integrated co-production chain in the apparel, textile and cotton industries supporting more than 1 million jobs and facilitating $12.5 billion in two-way trade.
The report was released as part of a public relations and Hill and administration advocacy campaign on January 26, supported by the co-chairs of the House Textile Caucus—Congressmen Patrick McHenry (R-NC) and Bill Pascrell (D-NJ).
In addition to the Werner report’s highlights of the resilient supply chain between the U.S. and CAFTA-DR region, the study also provides data-driven evidence of the adverse impact of proposals aimed at weakening the agreement’s carefully negotiated and longstanding textile rules of origin. Proposals by certain retailers and apparel brands to dismantle CAFTA-DR’s rules would have a devastating effect on the collective industries in the region and U.S. and result in massive job, investment and export losses, the report finds.
The Werner report comes at a pivotal time, as Xinjiang’s illegal use of forced labor is tainting imported consumer products and the global shipping crisis is diverting supply chains away from China.
NCTO will continue to do substantial outreach to ensure key stakeholders understand the severe impacts this would have across the whole industry. Staff will also engage with efforts on the Hill to create incentives to help onshore and nearshore more textile and apparel production.
Lastly, the study provides recommendations to the Biden administration, which is currently conducting a comprehensive review of root causes of migration issues associated with three Northern Triangle countries within the CAFTA-DR region.
Key Findings from Werner report:
Adverse consequences to adding flexibilities to/weakening the yarn forward rule:
Proactive steps to help improve the competitive position of CAFTA-DR region:
Aurora Specialty Textiles Group in Expansion Mode in Industrial Textiles
/in Recent News, TIN Blog /by Kristi EllisAurora Specialty Textiles Group, Inc., a global leader in coating, dyeing and finishing of woven, non-woven and knit fabrics, has proven that resilience and an innovative spirit can propel a company to new heights, even during one of the most challenging times in the industry’s history.
Aurora was originally founded as a cloth prep facility in Aurora, Illinois in 1883. The company has since evolved and flourished as a domestic manufacturer, transitioning first into textile dyeing and finishing in the 1920s, then into textile coating capabilities in the 1950s.
In 1977, Aurora was purchased by Meridian Industries, Inc., a privately owned manufacturing holding company comprised of five operating entities, including Majilite, Meridian Specialty Yarn Group, Inc., Kleen Test Products Corporation, and Kent Elastomer Products Inc.
The company continued to expand through the following decades and in 2015 invested in a new state-of-the-art, wide-width coating and finishing line and a new facility in Yorkville, Illinois that dramatically expanded their ability to serve customers and new markets.
Today, Aurora offers a complete portfolio of products, including digitally-printable textiles, specialty home products, tape-backing products and technical textiles for a wide variety of industries.
Aurora President Marcia Ayala, who joined Aurora in 2006 and was named president in 2019, is leading the company on a rebranding drive, while also navigating myriad challenges, from rising raw material prices and transportation costs to a global supply chain crisis.
“The company has rebranded itself and really expanded and grown from the point of view of its manufacturing capabilities,” Ayala said.
As part of the rebranding effort, Aurora has engaged heavily on social media channel LinkedIn, posting company news and updates weekly. In addition, Aurora is currently in the process of upgrading its website.
“It has made a difference,” Ayala noted. “We do see that we are getting more inquiries as a result of our presence and engagement on LinkedIn.”
These initiatives have helped Aurora maintain and grow business in an uneven economy roiled by the COVID-19 pandemic that has impacted the entire U.S. manufacturing and retail sectors.
Aurora’s product offerings and services are extensive.
The company’s products cover a wide range of applications, from pressure sensitive tapes with a fabric backing, like gaffer’s and athletic tapes, to digitally printable textile applications such as canvases, banners and window displays and wall coverings. Other applications include power transmission belting, military, abrasives, healthcare and safety, and protective outdoor coverings.
In addition, Aurora has a range of textile finishing capabilities including fabric preparations such as bleaching, scouring, singeing and brushing/vacuuming; dyeing capabilities; pad applications to apply treatments such as fire retardant, water-repellent and anti-microbial; coating capabilities for a range of water-based coatings; and calendering, sanding and converting services.
Navigating the Pandemic, Rising Raw Material Costs and a Global Supply Chain Crisis
“Like many businesses, when the pandemic first hit, our business slowed considerably and was down in 2020,” Ayala said. “While we hunkered down, we continued to manufacture throughout the pandemic. We never shut down.”
Ayala said Aurora had some businesses that were resilient and remained consistent throughout the pandemic, though areas such as athletic tape and gaffer’s tape were impacted as sporting events and entertainment shut down at the height of the pandemic in 2020.
Demand and business rebounded in 2021, but with it came a whole new set of challenges triggered by a global supply chain crisis that has resulted in skyrocketing costs for freight, cargo, raw materials and chemicals.
“Transportation costs alone have doubled and tripled depending on where you are shipping it from,” Ayala said. “The challenge now is mitigating price increases as much as we can and meeting customer demand.”
“We have had to change the way we do business because of rising prices and longer lead times for raw materials. We implemented a longer time frame for forecasting and customer product demands, we are qualifying secondary suppliers, and we are requoting prices frequently due to the volatile and increasing prices of raw materials,” she added. “In some cases, we have been told from our suppliers that prices are only good for 24 hours. It has been going on for the past year and I don’t see any end in sight in the near future.”
But one challenge Aurora has managed to dodge is the labor shortage crisis that has plagued broad swaths of the manufacturing and retail sectors. Aurora employs 73 people and operates in a 120,000 square-foot facility.
“We have had very little turnover, across the board. Most of the turnover has been retirements. I think people enjoy working here and we have a very good culture focused on employee engagement, continuous improvement and input on ideas,” Ayala noted.
Emerging Markets
Looking ahead, Aurora hopes to expand its offerings to the military market: “We are looking at how we can act as a subcontractor to companies that need fabric finishing or coatings, like durable water repellants or anti-microbial finishes. This is a business that we have already grown, and we are looking to expand it,” she said.
She said government procurement business under the Berry amendment is extremely important and is a topic that will be highlighted on Aurora’s newly designed website.
“Our sweet spot is Berry compliant business where we offer our coatings, bleaching, and finishing services to companies that already have fabric procured, and we can add value,” Ayala said.
“Another area Aurora is exploring, one that would fit well with its core competencies, is outdoor protective fabrics for end products like boat covers and canopies, where it can offer a wide range of polyurethane coatings or water resistance coatings,” she added.
Sustainability
Aurora, a Meridian Industries, Inc. company, is ISO 9001 and ISO 14001 certified, and an industry leader in sustainable manufacturing practices.
The company moved into its state-of-the-art facility in 2015 and has made a significant investment on sustainability upgrades at its plant in Yorkville.
Among the upgrades to Aurora’s new facility, the natural gas and electricity components were designed to significantly reduce its manufacturing carbon footprint.
The move from its original plant in Aurora to the new plant in Yorkville led to a reduction in natural gas and electricity consumption of 4,134 metric tons of CO2. That is the equivalent of 465,178 gallons of gasoline per year or 4,523,015 pounds of coal burned, according to the company.
Over $1 million was invested in new equipment alone, including Variable Speed Drives to adjust motor speed to match demand (to prevent operating equipment running at constant full speeds), new higher efficiency boilers powered by gas, and a Building Automation System (BAS) that allows the company to schedule equipment to turn on and off automatically through a central computer, which helps reduce energy consumption.
As members of the Valley Industrial Association (VIA), which serves manufacturers throughout Northern Illinois, Aurora said it has begun sharing its sustainability management ideas with other manufacturing operations in the region and is helping them to identify ways to save energy and water resources and also reduce waste.
Aurora is a finalist in all six VIA benchmark categories, including innovation, culture, operations, safety, social responsibility and workforce development. The VIA’s “Spark Awards” will be held on April 27.
Onshoring/Nearshoring
Ayala said she is very supportive of onshoring more weaving and manufacturing.
“It has been an advantage for us to be a domestic manufacturer, because of the global supply chain crisis and the issues with imported products over the past two years,” she noted. “People are starting to see more value in having domestic suppliers because of reliability, a shorter supply chain and lower costs from a transportation perspective.”
Ayala said her customers also find value in promoting products that they can label as manufactured in the U.S.
She said free trade agreements, such as the U.S.-Mexico-Canada Agreement (USMCA) have been beneficial and led to new exports to Canada, though over 90 percent of Aurora’s products and services are consumed domestically.
“Free trade agreements spur more domestic production of fabrics and yarns,” Ayala said.
Aurora hosted U.S. Trade Representative Katherine Tai and Congresswoman Lauren Underwood (D-Ill.) on a tour of its facility and a roundtable discussion featuring women-led manufacturing firms and union representatives in late August last year. The event was hosted by Ayala and Bruce Pindyck, chairman and CEO of Meridian Industries, Aurora’s parent company.
The visit came at a critical time as Congress was debating the bipartisan Infrastructure Investment and Jobs Act. The bill, which Congress ultimately passed, includes support across Illinois communities for public transit, improvements to roads and bridges, and improved passenger and freight rail and programs.
“The fact that Ambassador Tai was willing to visit small manufacturing companies like ours and talk to us about what is important to us was impressive,” Ayala said.
“When we went on the plant tour, she was interested in our manufacturing capabilities and asked questions about what was impacting our business and how trade policy impacts our business.”
“I asked her if it was typical for a U.S. trade representative to come on a tour of a small company and talk trade policy and she said it was her own innovation and practice—to meet with manufacturers and workers around the country—instead of putting out trade policies without asking industry first how it would impact us,” Ayala said. “That made such an impression.”
NCTO Welcomes House Passage of America COMPETES Act; Helps Close De Minimis Loophole
/in Press Releases /by Kristi EllisWASHINGTON—The National Council of Textile Organizations (NCTO), representing the full spectrum of U.S. textiles from fiber through finished sewn products, issued a statement today welcoming House passage of the America COMPETES Act, a legislative package that will help close the de minimis loophole on duty-free imports from China and also renew the Miscellaneous Tariff Bill (MTB), both important provisions to U.S. textile manufacturers.
“We commend the House for passing this sweeping legislation, which contains several critical trade provisions beneficial to American manufacturers,” said NCTO President and CEO Kim Glas. “This legislation contains a provision that would effectively prohibit China from exploiting the Section 321 de minimis mechanism in U.S. trade law, a win for U.S. textile producers and workers.”
“We sincerely thank Congressman Earl Blumenauer (D-Ore.) for working diligently to include and preserve his Import Security Fairness Act in the underlying U.S. competitiveness bill. This bill would help close the de minimis loophole, which allows imports valued under $800 to come into the United States without paying duties and taxes, bypassing inspections by U.S. Customs and providing a backdoor to Chinese goods produced with forced labor. The loophole has not only fueled the rise of imports from foreign e-commerce companies and mass distributors, but it has also put our domestic manufacturers and workers at a competitive disadvantage.”
Another important provision in the legislation renews the MTB for two years, which would extend limited tariff relief on a range of manufacturing inputs used by U.S. textile producers.
In closing, NCTO’s Glas stated: “NCTO worked closely with our allies in the House on these provisions in the underlying bill and we commend their hard work and support. We will continue to push for these critical provisions that benefit the U.S. textile industry in Senate-House conference negotiations in the coming days.”
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NCTO is a Washington, DC-based trade association that represents domestic textile manufacturers.
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Kristi Ellis
Vice President, Communications
National Council of Textile Organizations
kellis@ncto.org | 202.684.3091
Independent Study Highlights Benefits of U.S.-CAFTA-DR Agreement and Devastating Impact of Weakening Agreement’s Rules
/in Press Releases, Recent News /by Kristi EllisWASHINGTON—The National Council of Textile Organizations (NCTO), representing the full spectrum of U.S. textiles from fiber through finished products, issued a statement today on the release of an independent study examining the valuable economic and societal impact of the U.S.-Dominican Republic-Central America Free Trade Agreement (CAFTA-DR), and the significant adverse impact of proposals aimed at weakening the agreement’s rules of origin.
The economic study conducted by Werner International highlights the importance of maintaining the current rules of origin in the agreement, which supports more than one million jobs in the U.S. and the region and $12.5 billion in two-way trade and has fostered significant and impactful investments in manufacturing and apparel production. The study also finds various proposals aimed at weakening the agreement’s carefully negotiated and longstanding textile rules of origin would severely harm the region and U.S. and result in massive job, investment, and export losses.
“The Werner report comes at a pivotal time, as the global supply chain crisis and concerns over forced labor in Xinjiang have sparked a shift in sourcing out of Asia and a renewed focus on nearshoring and onshoring jobs back to the Americas. As outlined in this report, the U.S-CAFTA-DR agreement is a critically important and deeply economically impactful agreement that has fostered a co-production chain for textiles and apparel supporting over one million jobs in the region and the U.S,” said NCTO President and CEO Kim Glas. “This is due to a key element of the agreement called the ‘yarn forward rule of origin,’ a unique investment-based rule that ties lucrative duty-free access to the U.S. market to investment in yarn, fabric, and cut-and-sew production in the region and the U.S.”
Glas added, “We appreciate the broad bipartisan support, including from the administration, for maintaining the essential yarn forward rule of origin and ensuring those rules are not eroded through harmful changes. This common support for preserving the provision is vital to the bipartisan efforts focused on ushering in a new era of American manufacturing prowess and economic prosperity. Conversely, the report found that weakening the rules by adding ‘flexibilities’ such as cumulation and short supply changes would exacerbate the migration crisis by devastating our industries and further tether us to our counterparts in Asia, including China.”
Jan Urlings, Vice Chairman of Werner International, stated, “In our examination of the economic and societal impact of the U.S.-CAFTA-DR agreement, we found the current benefits of the agreement support a strong and vertically integrated co-production chain that has contributed significantly to investment and economic stability in the region and the United States. A major aspect of our report examined how various proposals aimed at weakening the rules of origin would impact the region and the U.S. The data overwhelmingly demonstrates that the current co-production chain would be undermined by subsidized Asian/Chinese fabrics and yarns whether directly or indirectly through a third party, would devastate direct and indirect textile employment and investment in the U.S., the region and the entire Western Hemisphere. It would also exacerbate enforcement issues associated with Xinjiang cotton produced with forced labor.”
The study goes on to find that if brands and retailers made a commitment to double exports from CAFTA-DR to the U.S under the current rules, it would result in an additional 180,000 U.S. textile jobs, 2.17 million new jobs in the CAFTA-DR region, and conservatively $6 billion in new investments in the U.S. and region.
Rep. Bill Pascrell (D-NJ), Textile Caucus Co-Chair, stated, “Imports from China and other countries that use forced labor and other predatory trade practices have crippled our manufacturing industries and destroyed millions of U.S. jobs. The manufacturing of cotton products and other goods from Xinjiang have tainted our supply chains and helped perpetuate the Chinese Communist Party’s continued human rights atrocities. As global supply chains are recalibrating to nearshore and onshore textile and apparel production chains under the rules of origin in our Hemispheric trade agreements, we must strongly reject efforts to erode those essential rules that support textile and apparel jobs in the U.S. We must not allow China backdoor access to these critical markets, which will further hurt our own industries and reward China and other countries with direct and indirect preferential tariff access.”
Rep. Patrick McHenry (R-NC), Textile Caucus Co-Chair, stated, “The global supply chain crisis triggered by the coronavirus pandemic has exposed our severe overreliance on China. This report showcases that onshoring and nearshoring of this critical production chain is critical for the U.S. textile industry and workers in the CAFTA-DR region. The US-CAFTA-DR trade agreement has spurred hundreds of millions of dollars of investment because of the strong rules of origin that support this co-production chain. Any erosion of these rules would harm American producers and exacerbate the immigration crisis. As supply chains are pivoting, we must seize on the opportunity for growth in good paying jobs in both the U.S. and the region and end our overreliance on China.”
Key Findings from Werner report:
1. Adverse consequences to adding flexibilities to/weakening the yarn forward rule:
2. Proactive steps to help improve the competitive position of CAFTA-DR region:
DOWNLOAD RELEASE
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CONTACT: Kristi Ellis | (202) 684-3091 | www.ncto.org
Vice President Kamala Harris Shines Spotlight on Parkdale Mills Investment at White House Roundtable
/in Recent News, TIN Blog /by Kristi EllisVice President Kamala Harris highlighted investments in northern Central America and the U.S. by Parkdale Mills and six other companies at a White House roundtable on December 13, part of the administration’s Call to Action to the private sector to promote economic opportunity in the region to address the root causes of migration.
Parkdale Mills, one of the largest manufacturers of spun yarn and cotton consumer products it he world, will make a multimillion-dollar investment in a new yarn spinning facility in Honduras, as well as an additional substantial investment to support existing operations in Hillsville, Virginia. This investment will help customers shift one million pounds of yarn per week away from supply chains in Asia and China and enhance U.S. and CAFTA-DR co-production resilience an dincrease regional product offerings. The new investment will create hundreds of jobs in Honduras and further support hundreds of employees in Parkdale’s Hillsville operations.
Parkdale Chairman and CEO Andy Warlick attended the Vice President’s roundtable and outlined the importance of onshoring and nearshoring, particularly in the midst of a global supply chain crisis that is forcing retailers and brands to recalibrate supply chain strategies to mitigate risk.
The co-production chain with Central America is vital to the employment and investment in the region and the U.S.
Here are some compelling facts:
This supply chain is predicated on the strong yarn forward rule of origin and other textile rules in the CAFTA-DR agreement.
Recently, administration officials from the U.S. Trade Representative’s office and the Vice President’s office met with the U.S. textile industry to reaffirm the importance of rules of origin in nearshoring production chains, helping address labor and environmental challengers and mitigating supply chain risk.
Remarkably, as supply chain issues out of Asia are on the front page, some importers are seeking so- called “relief,” and proposing to weaken the yarn forward rule of origin and other provisions in the agreement. Changing any aspect of the textile rules embedded in the CAFTA-DR agreement would give Chinese yarns and fabrics and those from other countries that are not signatories to the trade pact backdoor access to the CAFTA-DR market and jeopardize hundreds of thousands of jobs that in U.S., CAFTA-DR region and the entire Western Hemisphere.
Warlick highlighted to the vice president the critical co-production chain with the CAFTA-DR region and stressed that this supply chain is quicker, more transparent, more reliable, more sustainable, and free of the forced labor that has been widely documented in Xinjiang, China.
In terms of sustainability alone, a container coming from Central America versus China cuts greenhouse gas emissions by 80 percent. On average, apparel exported from China produces 51.8 kgs of C02 per ton, compared to 18.1 Kgs of CO2 from CAFTA-DR.
Warlick offered a vision for the future of the U.S. industry and this critical co-production chain with Central America and the Western Hemisphere as a whole.
The CAFTA-DR region represents about 7 percent of global apparel and textile imports to the U.S., while China and Asia represent the vast majority of the remaining 93 percent.
By merely doubling the productive capacity and exports from CAFTA-DR, an estimated 2.4 million jobs could be created and billions of dollars in new investment could be unlocked, according to an independent analysis on the economic impact of CAFTA-DR.
NCTO continues to urge retailers and apparel brands to make long-term investments in onshoring and nearshoring production to not only avoid the next breakdown in global supply chains but to invest in strong labor and environmental standards and employment in this hemisphere.
Parkdale’s investment and anticipated investments by other NCTO members underscore how critical and valuable the co-production chain is to the economies of the U.S. and Central America.
This is an exciting time for nearshoring and onshoring these critical production chains. There is a long history in this industry with Central America and the Western Hemisphere and we have never seen an opportunity that is so ripe for these investments and further strengthening our textile and apparel co-production chain.
Vice President Kamala Harris Announces New Investments in Northern Central America Highlighting NCTO Member Parkdale Mills at White House Roundtable
/in Press Releases, Recent News /by Kristi EllisWASHINGTON—Vice President Kamala Harris announced significant multimillion-dollar investments by Parkdale Mills and six other companies today, as part of the Administration’s Call to Action to the private sector to promote economic opportunity in the region, as her office works to address the root causes of migration.
Vice President Harris, who is overseeing diplomatic efforts with El Salvador, Guatemala, Honduras, and Mexico, announced several private sector commitments to strengthen economic opportunities in the Northern Triangle and will make remarks later today at a White House roundtable, which will include Anderson Warlick, Chairman and CEO of Parkdale Mills. The textile and apparel co-production chain is one of the most essential supply chains for employment and economic development in both the United States and the Northern Triangle region, currently supporting over 1 million jobs in the United States and the Central American region. The Dominican Republic-Central America Free Trade Agreement (CAFTA-DR) and its strong rules of origin are the primary reasons this co-production chain exists, which is seeing significant growth this year.
North Carolina-headquartered Parkdale Mills, one of the largest manufacturers of spun yarn and cotton consumer products in the world, will make a multimillion-dollar investment in a new yarn spinning facility in Honduras and make an additional substantial investment to support existing operations in Hillsville, Virginia. This investment will help customers shift 1 million pounds of yarn per week away from supply chains in Asia and China and enhance U.S. and CAFTA-DR co-production resilience and increase regional product offerings. Parkdale’s announced investment will create hundreds of jobs in Honduras and further support hundreds of employees in Parkdale’s Hillsville operations.
Recently, administration officials from the U.S. Trade Representative’s office and the Vice President’s office met with the U.S. textile industry to reaffirm the importance of rules of origin in nearshoring production chains, helping address labor and environmental challenges and mitigating supply chain risk.
“I would like to sincerely thank Vice President Harris for making this announcement and leading the effort with private industry to create more economic opportunities in northern Central America and the United States,” said Anderson Warlick, Chairman and CEO of Parkdale Mills. “Parkdale’s investments will support good paying jobs in the United States and in the Central American region and significantly increase our extensive product offering and capacity, including the production of sustainable specialty yarns.
Parkdale sees an enormous opportunity for brands and retailers to re-shore and nearshore production supply chains and double the size of U.S.-CAFTA-DR trade, because of the rules of origin in our trade agreement and a shift in sourcing by brands and retailers mitigating their supply chain sourcing risks. We are excited about what this opportunity means for jobs in the U.S. and the region for this critical production chain and couldn’t be more thrilled to be part of this effort. We look forward to working with the Vice President and her team on strengthening the textile and apparel production chains in the U.S. and region.”
National Council of Textile Organizations (NCTO) President and CEO Kim Glas, said, “This is an exciting and important announcement by Parkdale and Vice President Harris. Our industry has invested billions of dollars in the U.S. and in the region as a result of the investment-based rules of origin in the CAFTA-DR agreement, which ensures the job benefits of the agreement are reserved for the parties to the agreement. Additional substantial announcements on further investment in textile and apparel production are expected soon.
As brands and retailers are seeking more environmentally sustainable, vertically integrated, transparent, and quick turnaround supply chains, our collective industries stand ready to work with companies that are seeking to mitigate sourcing strategies as Asian supply chains have faced enormous production constraints. Further verticalization in the industry, like Parkdale’s announcement today, allows broader product diversification and grows jobs across the textile and apparel production chain.
We are thrilled with today’s announcement because it is a win-win for American and Central American workers and our environment and a huge opportunity to further recalibrate supply chains out of China and Asia. This valuable co-production chain between the U.S. and the CAFTA-DR region accounts for $12 billion in two-way trade and billions of dollars of investment. Significant growth is occurring in our sector and is expected to continue as supply chains continue to recalibrate. We are delighted about this today’s announcement and appreciate the Administration’s strong support.”
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NCTO is a Washington, DC-based trade association that represents domestic textile manufacturers.
CONTACT: Kristi Ellis
(202) 684-3091
www.ncto.org
China’s Predatory Trade Practices Hurting U.S. Textile Industry, Western Hemisphere Co-Production Chain
/in Recent News, Testimony and Statements, TIN Blog /by Kristi EllisChina’s Predatory Trade Practices Hurting U.S. Textile Industry, Western Hemisphere Co-Production Chain
By Kristi Ellis
China’s unfair trade practices, ranging from rampant intellectual property theft to state sanctioned export subsidies, to the egregious abuse of forced labor in the production of cotton and cotton apparel for well-known global apparel brands and retailers has had a chilling effect on the U.S. textile industry and U.S. trading partners, particularly those in the Western Hemisphere.
The far-reaching impact of China’s illegal practices and its race to dominance as a global supplier of consumer products came under scrutiny at a recent House Ways and Means Trade Subcommittee hearing on Dec. 2, titled “Supporting U.S. Workers, Businesses, and the Environment in the Face of Unfair Chinese Trade Practices.”
NCTO President and CEO Kim Glas, in testimony before the committee, outlined China’s rise to dominance of global textile and apparel production and its adverse impact on the U.S. textile industry, as well as ways to strengthen onshoring and nearshoring of supply chains, and recommendations on the critical policies needed to address these illegal trade practices and rectify inequities in the country’s trade policies.
“China continues to dominate the global textile and apparel market, including our U.S. market through illegal subsidies, rampant IPR theft and other predatory trade practices,” Glas told lawmakers in her opening remarks. “This has cost hundreds of thousands of domestic jobs here in the United States and undermined critical production chains like personal protective equipment (PPE).”
“If I were to offer one overarching recommendation today, we need to hold China accountable and ensure our trade policies are keeping pace to address the rapidly emerging predatory challenges we are facing from China and others,” she added.
Rep. Earl Blumenauer (D-Ore.), chairman of the powerful trade subcommittee, said in his opening remarks, “Instead of joining other market-based world economies, China has doubled down on its state-driven economic model. Economists now describe this phenomenon as the ‘China shock,’ which has had devastating and sustained impacts on U.S. workers and businesses across our country,” Blumenauer said.
“More broadly, China continues to demonstrate that it refuses to play by the rules. China will exploit loopholes wherever they exist. We’ve given too much of a free pass to China over the years – it’s now time to take these issues seriously and take a more aggressive approach,” he stressed.
Glas said China’s “abusive environmental and labor record is on full display in our sector and has been well documented.”
Egregious & Illegal Use of Forced Labor in China
China makes up 44 percent of U.S. imports of textile and apparel products, she noted. One in five garments coming into the U.S. from China are made with forced labor from Xinjiang “with the worst human rights abuses imaginable,” she noted.
Between 2017-2019, the Chinese government has forcefully transferred an estimated 800,000 to 1.8 million Uyghur Muslims from their homes in Xinjiang to detention centers and factories throughout China forced to manufacture products for international sale under forced labor conditions, according to numerous reports and international and domestic news outlets, Glas said in written testimony submitted to the committee.
Given that 20 percent of global cotton production is sourced from Xinjiang, tainted apparel and textiles made with forced Uyghur labor is a serious problem for the U.S. and the world.
U.S. Customs and Border Protection (CBP) issued a Withhold Release Order (WRO), effectively a ban on cotton and cotton products coming from the Xinjiang region in China, but the agency lacks the resources to inspect and stop a majority of goods from Xinjiang from entering the U.S. market, Glas told the committee.
“These items are bleeding into our supply chains and making it to our store shelves and into our closets,” Glas noted in her opening remarks.
Section 321 De Minimis Loophole
“Some of these products are making their way with the press of a button to our doorstep using the Section 321 de minimis loophole that allows these goods to come in duty free—not just evading China 301 duties, but all duties—from China and elsewhere with little scrutiny by U.S. Customs on these products,” she continued.
The United States provides a duty exemption for goods valued at less than $800 in retail value if imported by one person on one day.
Of note, the de minimis exemption was raised from $200 in 2016 under the U.S. Customs reauthorization legislation. The current application of de minimis provides exemptions on base MFN tariffs, as well as Section 301 tariffs, such as those currently in place against imports from mainland China. Use of this exemption has skyrocketed alongside the growth of direct‑to‑consumer e‑commerce, which has further accelerated due to the COVID‑19 pandemic.
De Minimis exemptions are a loophole that allows tainted goods to be imported into the U.S. market duty free virtually unchecked and undermines carefully constructed textile and apparel rules of origin in CAFTA-DR and other free trade agreement and trade preference partners.
Blumenauer took note of Glas’ remarks and called out her reference to the de minimis problem.
“Ms. Glas has noted the example of Shein [a Chinese e-commerce conglomerate that imports billions of dollars of apparel to the U.S.]. This Chinese company has developed a business model to exploit the de minimis provision in U.S. law to avoid paying any costs or go through oversight at the U.S. border, all of which undercuts U.S. companies playing by the rules,” Blumenauer said.
“Shein is also part of the Chinese textile industry that benefits from the deplorable treatment and forced labor of Uyghurs and other minorities in the Xinjiang region of China. Lack of oversight at U.S. borders makes it even more difficult for CBP to intercept these shipments,” he noted.
Blumenauer pointed to a roundtable he attended on the issue, nothing that he was made aware of the fact that some 2 million packages are shipped into the U.S. each day under de minimis waivers. He also noted that one witness suggested as many as 6 million packages per day are coming into the U.S. market under the Section 321 waivers.
“These issues with de minimis and forced labor are key areas of importance for me and ones that I intend to legislate on in the coming months,” Blumenauer said.
Rep. Danny Davis (D-Ill.) asked the hearing witnesses what they considered would be the most practical end expeditious solution to addressing China’s illegal practices.
“In terms of things in our trajectory that we can get done very quickly, closing the de minimis loophole is one and effectively banning the cotton and cotton products coming from Xinjiang,” Glas said. I do not believe we have given CBP the resources to effectively administer the WRO. We should be holding daily press conferences on stopping shipments coming in because that will help recalibrate supply chains both here to the U.S. and to our Western Hemisphere partners.”
China’s Predatory Practices Hit CAFTA-DR Countries
“These predatory practices have not only harmed U.S. manufacturers and workers, but also drastically impacted our valued political and economic allies in the Western Hemisphere,” Glas said.
“For example, the CAFTA-DR-U.S. co-production chain for textile and apparel supports over 1 million jobs and has been a critically important and a deeply economically impactful agreement, despite the headwinds from China’s increased access to our markets during the agreement’s existence,” she said.
The main driver behind the stability in the face of the China juggernaut is the yarn forward rule of origin, Glas said.
“This unique investment-based rule ties lucrative duty-free access to the U.S. market and our consumers to ensure investment in yarn, fabric and cut and sew production. Simply put, it means the agreement requires the signatories of the agreement gain the job benefits of the agreement.”
“Onshoring and nearshoring are happening. Key CAFTA-DR countries have seen exports up anywhere from 33 to 56 percent, outpacing major Asian exporters, and more investment in yarn, fabrics and apparel production will be announced soon,” she added.
Glas told the committee that apparel brands and retailers importing product to the U.S. from China are seeking “so-called relief [such as weaking the rules of origin in CAFTA-DR] to give Chinese yarns and fabrics and other countries that are not signatories of the agreement, backdoor access to the CAFTA-DR market.”
“These Trojan Horse ideas must be rejected out of hand because they hurt U.S. jobs and those in the region and reward other countries,” she noted.
In one of the liveliest exchanges during the question-and-answer session with the committee, Rep. Tom Suozzi (D-NY) called on retailers and apparel brands, some of whom have complained that the ban on cotton and cotton products from China is raising prices on imported goods to the U.S. and said they should shift more production to the U.S. and Western Hemisphere.
“The [U.S.] textile industry is very concerned about what China is doing. We’ve gone to China for cheaper goods,” Suozzi said.
He said the U.S. should close the U.S. market to imported goods from the Xinjiang region, something that could be helped by passage of the Uyghur Forced Labor Prevent Act (which the House passed last week).
“We should say that any goods coming from the Xinjiang region are presumed to be made with forced labor,” Suozzi said.
“Concerns from industry and others that this will make the cost of T-shirts and pants go up and be passed on to the consumer, my initial reaction to that is: “It’s too damn bad.”
“We have to hold them accountable for the way they are treating human beings in their country,” Suozzi added.
Glas agreed with Suozzi’s recommendations, noting that she is a commissioner on the U.S. -China Economic and Security Review Commission, and pointing to a recommendation from the commission this year to ban all products coming from Xinjiang for importation to the U.S. market.
“Seventy percent of U.S. textile, fiber, yarn and fabrics go to our Western Hemisphere trading partners,” Glas said. “We have one of the best cotton growing industries in world. There is transparency in our supply chains here and in the hemisphere because we have a strong rule of origin under our free trade agreements.”
“We are already starting to see opportunities coming to our hemisphere. Trade is up from some of the Northern Triangle countries by 56 percent over the last two years because Asian supply chains are breaking down,” Glas added. I do think there are retailers who are trying to de-risk out of Asia given the pervasiveness of the Xinjiang cotton issues. Our market is open here in the United States and we’re open for business in the Western Hemisphere. This is a huge opportunity to onshore and nearshore these critical production chains.”
Glas outlined key policy recommendations to the committee, including: