There are signs around the world that the textile market is beginning to recover from the global economic crisis, and developing markets will be leading that recovery. Asia is, of course, at the forefront, but many countries in Latin America have also weathered the storm and have come out in a surprisingly decent position, with their dynamic textile and apparel industries well positioned for future expansion.

It is difficult to speak about textile industry trends in Latin America as a whole because there is such a range of diverse economic situations within each country.
Some textile industries, such as those of Colombia, Peru and the current economic star of Latin America Brazil, are dynamic and expanding rapidly; while others such as Argentina and Mexico have suffered some setbacks. Still others, such as Venezuela and Bolivia, are in serious trouble.
Looking at the supply side, according to 2009 quarterly trade reports from the International Textile Manufacturers Federation (ITMF), yarn production was down 26.8% in South America (excluding Mexico, central America and the Caribbean) in the first quarter of 2009 compared to the last quarter of 2008, but rebounded by 44.9% in the second quarter, more than any other region.
South America took the lead again in the third quarter, up a further 5%. (However, this was still 5.3% lower than the same period in 2008).
Fabric production fell by 16.5% in the first quarter of 2009 in the same region, and was down a further 0.5% in the second quarter, but rebounded dramatically by the third quarter, leaping 18.1%. By the third quarter, fabric production in South America was up 11.8% compared with the same period in 2008.

Long-term capacity growth
But last year was a recession year and unusual. Looking over a longer period, Latin American textile and apparel production capacity has been growing. In the last 10 years Brazil and Mexico were among the top 10 most important markets for textile machinery from Germany, the largest exporter of textile machinery globally.
During this period Brazil spent EUR1.08bn on such machinery, and Mexico EUR676m. In 2008, Brazil was Germany's sixth most important market for textile machinery, purchasing EUR120m of equipment (an increase of about 4% compared to 2007), EUR48m of which was for spinning machinery (an increase of 37.4% from 2007).
"While 2008 saw massive downturns in all major textile markets, the Brazilian market performed steadily," according to the VDMA, Germany's Textile Machinery Association, in a press release in 2009.
"Among the Latin American countries Brazil is definitely a rising market for German textile machinery," agreed Nikolai Strauch of the VDMA.
The Association of Italian Textile Machinery (ACIMIT) said that Latin America made up 11% of the Italian industry's exports in 2008, and sales are expected to continue to grow. Italy is the second largest provider of textile machinery to Brazil, and saw their exports to Brazil expand by 22% to EUR66m in 2008.

Rosy future for exporters to Latin America
As for demand, the future looks rosy for textile and clothing companies within the region and businesses seeking to export product to Latin America.
According to management consultants AT Kearney's global retail development index standings, seven out of the top 30 emerging countries with retail development potential in 2010 are in Latin America, including Chile (7), Brazil (8), Mexico (12), Peru (18), Colombia (28), El Salvador (29), and Argentina (30).
And even better news for the textile industry: three out of the top 10 favoured developing markets specifically for apparel in 2010 are Latin American, including Chile (7) and Argentina (5). Brazil was rated number one, beating giants such as India, China and Russia.
Sophie Dewulf, materials editor for clothing information service Stylesight, said: "Generally speaking, prospects for 2010 in the textile business are still not that rosy.
"The worldwide market is simply still product over-saturated. But South America in particular is part of the new market with concrete opportunities for developments, where the possibilities for good business performances are higher compared to EU markets", for instance.

Peru shows small Latin America countries matter too
It is not only major markets that matter in Latin America these days. Small and medium-sized countries matter too - a symbol of the region's depth in terms of sales and marketing for the international clothing sector.
In Peru, for instance, a medium-sized country, textiles and apparel are the third most important export industry after mining and fishing. Peru is the number one producer of the high-end wools alpaca and vicuna, and also produces pima cotton.
Peru is a quality supplier of fibres and knitwear to many important international brands, including Calvin Klein, Polo Ralph Lauren, Adidas, Levi Strauss and Co., Zara, Reebok and Saks Fifth Avenue.
Peru's textile exports have benefited extensively from the Andean Trade Preferences Act (APTA) and Colombia's fallout with Venezuela; in 2009 the United States and Venezuela were the main importers of Peruvian textiles, purchasing US$400m (EUR292m) worth of products, according to the Lima chamber of commerce (CCL).
Some of Peru's leading textile companies include Topy Top, Textimax, Devanlay Perú, Diseño y Color, Creditex, Sudamericana de Fibras, and Industrias Nettalco.
Textile exports grew by about 15% in 2007, according to Peru's national industry association (SNI), but dropped by 28% from US$2bn in 2008 to US$1.4bn in 2009, in large part due to the economic crisis.
However SNI also reported that textile companies have invested nearly US$700m in the last five years and will continue to invest more in the future - and if Peru can weather the crisis, its textile industry is expected to recover and continue to expand.
Looking at demand and retail, Peru, which is still one of the poorest nations in Latin America, had the highest GDP growth in the region in 2008, at 9.8%, according to AT Kearney. However, in terms of the retail market Peruvians are still not big spenders, and not likely to be so for quite some time.
That said, some retailers are doing very well in Peru, such as Falabella, Cencosud and Ripley, all of which invested heavily in Peru in 2008.
About 50% of Peru's textile imports come from China, followed by 34% from India. The next biggest importers are the US, Taiwan and South Korea, according the UN Comtrade database.

By Pacifica Goddard.