NEWS AND EVENTS
October 20, 2014
Chock-Full with Cotton
It has been quite a while since Uzbekistan got rid of the monopoly of cotton in the agricultural sector. The country has not just retained its leading position in producing and exporting the ‘white gold’, but turned into a noticeable player in the textile market.
Meanwhile, today the country faces new challenges. Experts argue that the next season is going to be difficult for the market. As estimated, China, the largest buyer of cotton fiber, is planning to drastically reduce cotton procurement, which will undoubtedly lead to a drop in prices. Unlike many others, Uzbekistan is ready for the challenge, because in the past decade the country took significant steps to intensify the domestic cotton processing and increase the production of finished goods with high added value.
The contemporary cotton industry faces numerous challenges, an effective overcoming of which predetermines the future of the industry.
The estimated decline in prices in the next season and the crisis of overproduction has prompted the governments of manufacturers to take measures on boosting government support for farmers engaged in the cultivation of cotton. The situation is complicated by the fact that in recent years the cotton fiber has been challenged by the growing domination of synthetic fiber with a number of advantages over the natural one.
Therefore, the sector has to urgently tackle a range of issues. In circumstances as such, success can only be achieved by coordinated actions of all stakeholders. Thus, our hospitable land is the best venue to search for a consensus, as it has hosted the International Uzbek Cotton and Textile Fair for the tenth time. Over the years, it has turned into the pivotal platform for drawing the course of the industry in the near future.
The first fair was held in 2005. At that time, it was hard to imagine that some ten years later, the event will turn into an event of global scale. For instance, in its first year the fair was attended by about 300 representatives of companies from 26 countries. This time around, Tashkent has received over a thousand experts, businesspeople, academics and traders from over 40 countries. It’s not because today Uzbekistan ranks as the world’s sixth cotton fiber producer and the fifth exporter. Our country has proved that it constantly keeps abreast of the developments taking place in the industry, forecasting many turns and fluctuations in the market, and opting for policies that eventually turns into a universally recognized trend. For example, the cotton fiber, which has gradually yielded to the cheaper synthetics, has acquired a kind of ‘second wind’ owing to the Uzbek researchers who have pioneered the new direction of genetic engineering of cotton.
They were first in the world to invent the technology of ‘gene knockout’, which improves the quality of fiber, accelerates its ripening, and increases the cotton yield. However, the uniqueness of the technology lies in another dimension: many research centers dealing with similar issues bred both high-yielding varieties of cotton and long-fiber varieties.
Nevertheless, they always faced a challenge: in case of a genetic change maturity suffered in favor of quality, and vise versa, the accelerated ripening negatively affected the quality of the fiber. The domestic center of genomics and bioinformatics was the only one to achieve the simultaneous improvement of several parameters that influence on the cultivation of cotton. That is why last year the International Cotton Advisory Committee awarded the center’s director Ibrohim Abdurahmanov with the title “Top Researcher of the Year”.
Today, scientific research is in full swing. The quality of cotton proposed for contracting in the Uzbek fair has been going up from one year to another through breeding new varieties. Over the recent years alone the Uzbek breeders have come up with dozens of new early maturing species with improved fiber length, resistant to pests and the climate of certain regions of the country. Worth noting here is the new transgenic breeding variety called Porlok, distinguished by high yields and the best indicators of adaptability to the conditions of Uzbekistan. Since 2013, new varieties of cotton seeds Porlok 1, 2, 3 and 4 are being bred on the fields of 20 farming enterprises and specialized seed farms.
Another reason why the fair is so important for Uzbekistan lies in the fact that it is the venue of contracting the bulk of the domestic cotton fiber that has a significant impact on the entire world market. This is clearly suggested by the lately changing geography of cotton exports. Prior to the year 2000, European countries were the major markets for the Uzbek cotton fiber, while in recent years, China, Bangladesh, Turkey and several other countries of Southeast Asia have come to the fore. The huge demand for Uzbek cotton is the result of its high quality, since about 90% of all cotton produced accounts for the first grade. Besides, the new transparent pricing system allows for avoiding sharp price fluctuations.
For example, in the 2013-2014 season alone, Bangladesh plans to buy 175 thousand tons of cotton in Uzbekistan, which is 24% of the overall imports of this type of product.
It is worth noting the well-built logistics of exporting the white gold. To date, the country has 21 specialized cotton terminals, including four free warehouses with the total single storage capacity of 410 thousand tons of cotton fiber. Over the last years, the foreign trade companies Uzmarkazimpex, Uzinterimpex and Uzprommashimpex have turned into conspicuous players in the international cotton market. Today, they are actively pursuing a marketing strategy using modern effective methods of sales. Having permanent strategic partners, the country’s foreign trade companies provide balanced and stable supply of Uzbek cotton and textile products.
Cultivating and collecting cotton is a colossal job, and it is just a part of the process at that. Many believe this is the whole mission of the cotton industry, and the further work comes to the textile industry. However, it is all much more complicated, because the correct certification, processing and packaging will determine the final cost of cotton fiber.
Annually, Uzbekistan grows over three million tons of raw cotton, which after processing gives more than a million tons of fiber, 1.6 million seeds, 80 thousand tons of lint and other products. The ginning industry enterprises are coordinated by Uzpakhtasanoat Association, which includes 98 ginning factories throughout the country, as well as 34 specialized workshops for the preparation of sowing seeds, supply chain and other support units.
Supported by the government, a significant share of cotton plants has been able to implement projects on technical modernization of production in recent years. The leading role in this process was assigned to international partnerships with foreign producers. For example, ginneries in Uzbekiston and Chinoz districts were supplied with modern Chinese production lines in 2012, thus replenishing the list of the enterprises outfitted with cutting edge imported production equipment. Projects on the reconstruction of five cotton factories, three of which equipped with technological hardware and presses from China, were carried out in 2013.
The commissioning of foreign-manufactured machinery and tools has helped refine the quality and quantity of produced cotton goods, reduce labor costs, bolster the production level and the workforce productivity. By the end of 2014 it is planned to complete technological modernization of four other companies – in Karakalpakstan, Surkhondaryo and Khorazm regions.
Besides, under the signed agreements it has become possible to incorporate the capacities of Chinese and Uzbek specialists in the implementation of a project to master the manufacture of modern strapping and packing materials in Uzbekistan. A joint venture Cotton Packing was established on the basis of Yangiyul Ginnery, and equipped with production lines for the manufacture of PET tape and PE containers.
The plant’s capacity is scheduled to fully cover the needs of the industry in packaging materials. In the 2013 cotton season a new system of packaging bales of cotton fiber was tested in 19 ginneries across the nation. As a result, the new technologies have significantly improved the marketability of products, decreased costs and raised the production culture.
Today, owing to what has turned out to be effective measures, the share of domestic processing of cotton fiber has exceeded 40%, while it used to account for only 7% of the total production as recently as in the 1990s. Experts estimate that in 2016, the index of domestic processing of cotton should reach 60%.
Light industry is currently among the most attractive and promising sectors of the real economy in Uzbekistan. This is also suggested by the volume of investments in it: over the years of independence, enterprises of the sector have invested more than $2 billion in the production development, implemented more than 200 projects on modernization of existing facilities, and construction of the new ones. Meanwhile, time zips along. 85% of domestically produced textile items account for joint ventures and foreign enterprises equipped with hardware from the world’s textile machinery manufacturers. Certain initiatives on the establishment of textile complexes with complete technological cycle, as partnered by South Korea, the European Union and CIS, are currently elaborated under the regional investment projects. In order to create the environment for drawing investments and establishment of modern high-tech industrial manufactures producing competitive products with high added value, Uzbekistan initiated three special economic zones.
The recent drastic changes in technological processes in global textile and light industry have allowed producing the entirely new articles that meet the most exacting requirements of consumers. Therefore, the building of its own base of textile machinery has been an important step forward for the local light industry. The manufacture of textile machinery was established in Tashkent together with the renowned Swiss engineering company Rieter AG.
The research component of the industry is getting increasingly intensive.
Innovative projects on the development of the manufacture of semi-finished textiles with new consumer properties and organic clothing for children are underway. Uzbekistan is now producing articles with additional components of built-in textile fibers: silver-plated threads, threads made of raw silk of transgenic silkworm. This is just a small part of industrial innovations, which will undoubtedly be relevant for the consumer market, the demand for which has been growing.
The intensified innovation activity and advanced scientific capacities are interlinked with related industries. Specialists are working on the innovation of a new generation of textile feedstock for the production of high-tech materials, and their use in medicine. Worth mentioning is the positive experience of cooperation with the Ministry of Commerce, Industry and Energy of the Republic of Korea and the Korea Institute of Industrial Technology. Under the agreements reached in Tashkent it is projected to establish a textile technology center, which will trigger a broad application of scientific and technological resources for the development of a competitive textile industry, fashion a new generation of items and ensure an appropriate level of training.
According to experts, intensive qualitative reforms on the basis of innovations, the increase in the scope of demanded and environmentally friendly products will allow domestic enterprises to significantly boost exports and access new markets. Branded ‘Made in Uzbekistan’, the articles are exported to over 40 countries, including even distant ones like Argentina, Brazil and Australia.
In the foreseeable future the light industry will retain a key role in the development of the industrial complex in the country. Financial and intellectual resources of the industry will be focused on priority areas of research and engineering activities, which are determinant for the implementation of priorities of socio-economic development of the country. The progress will be based on the development of innovative technologies and entailed creation of competitive products.
(Source: «Uzbekistan Today» newspaper)