China’s investments in Africa are now growing fast. Until recently, investments from China in Africa were largely focused on large projects in a few sectors, including mining, oil and infrastructure. Chinese companies are major players in the global textile market and important customers in the cotton market. Cotton exports from Africa to Asian countries are increasing. Textile production in China is today confronted with rising wages, higher energy bills and mounting logistical costs, as well as quotas on cotton import.
The combination of these factors is encouraging Chinese textile companies to invest overseas. One of them, Wuxi No. 1 Cotton Mill Textile Group Co. Ltd., recently signed a memorandum of understanding (MoU) with a partner in Ethiopia to invest in a spinning mill with 300,000 spindles. Set up in 1919, it is today the largest producer of high quality compact yarns worldwide. The group annually produces in China 26,000 tons of yarn with five lakh spindles.
Loepfe believes that such development is quite interesting and has spoken to the President of Wuxi No. 1 Cotton Mill, Ms. Zhou Ye Jun, on the motive of this partnership as well as the current state of affairs of their China operation and their focus on quality as the key factor for success.
“The encouraging message is that Africa has some unique advantages for Chinese investors. In comparison with Asia, Africa’s location is physically closer to the European and American markets. Africa also enjoys more favourable trade policies with the European Union and the US. Today’s African market of textile manufacturing has less competition as well. The huge population and immense space in the Continent provide great potential for manufacturers to develop. Africa’s rich natural resources and low labour costs are very attractive to Chinese investors as well. As an investor, Wuxi No. 1 Cotton Mill is bringing advanced technology and management techniques to their South-East African partner that will help improve local production processes and finally ensuring that the investment will be sustainable and profitable for all parties involved.”
Also for their China operation, innovation is the key factor to work successfully in the market. Today, Wuxi No. 1 Cotton Mill aims to strengthen the existing product lines and is constantly upgrading its manufacturing facilities. Demand for cotton yarns is ever increasing. To operate a spinning mill profitable, second quality must be avoided by all means and contamination free yarn is expected from the demanding worldwide markets. That’s why Wuxi No. 1 Cotton Mill has only recently invested heavily in upgrading all its existing Savio winders with Loepfe’s yarn clearing technology with foreign fibre functionality. Contamination, even if it’s a single foreign fibre, can lead to downgrading of yarn, fabric or garments or, in the worst case, the total rejection of an entire order.
The President added: “Industry 4.0 is the current trend in automation and data exchange in manufacturing technologies. Loepfe’s MillMaster monitoring system is connected to all the existing Loepfe yarn clearers on Savio winding machines. The information provided by the MillMaster system allows us to be promptly informed when there is a need to intervene and to steadily optimize the entire yarn manufacturing process in our mills. For Wuxi No. 1 Cotton Mill, we rely on this proven combination of total quality control by Loepfe Brothers Ltd. since many years.”