Textile Industry News

Cotton: The challenges for a revival of production in the DRC



For national needs in textiles and clothing, the country still relies entirely on imports of cloth (loincloth) from China or Nigeria, and thrift stores. Yet the Democratic Republic of Congo has significant potential for cotton production.

This offers very important benefits in the context of poverty reduction, since this crop is very well adapted to smallholder production, as well as to food security since it is in rotation with crops. who benefit from the necessary fertilizer financed by cotton. Specialists predict that it is difficult to revive this crop in the short and medium term.

Moreover, international prices are likely to remain relatively low ($ 1.50 / kg). And that, finally, the demand for the domestic textile product market though strong (more than 100,000 tons of seed cotton) will be absorbed by competition from imports. Today, with the forecasts that are projected, now is the time to revive cotton production in the DRC.

The revival of domestic production would require that protection measures (tariffs, quotas) repeatedly claimed in the past can be strictly applied in the future as in the case of the European Union (EU), say experts. In addition, this stimulus would require significant private investment for the rehabilitation of the national textile industry and associated ginning factories.

CHALLENGES FOR A RELAUNCH OF PRODUCTION

Today, it also seems difficult for the DRC to export its fiber to the international market, given the long distances between the main production areas and the export points (between 900 and 1,500 km), as well as costs high transport. The anticipated international price in the medium term translates into an FOB price of about $ 1.4 / t of fiber.

Transport costs ($ 150-200 / t) and current milling costs ($ 500 / t) would therefore make it possible to pay a price of about $ 700 / t, or $ 250 / t of seed cotton, which seems too low to provide producers with sufficient remuneration for their work (the cost of inputs - fertilizer and insecticides - which is very high) must be deducted from the farm gate price.

The revival of production for export would likewise require the rehabilitation of ginning factories and the restoration of input supply circuits, and thus significant investments. Today, foreign private investors are ready to come to the DRC without a large subsidy from the state.

THE KATANGA ONLINE MIRE

According to several sources, it is the region of the former Katanga that attracts the attention of potential investors. Production has stopped there completely. The introduction of cotton in Tanganyika dates back to 1933, except for the territory of Moba, which, due to its climatic environment, is favorable to wheat, potato and livestock farming. The current province of Tanganyika covers 135 000 km² (4.4 times the Belgian territory).

The agricultural peasantry was introduced in 1950, and cotton accounted for about 38% of the monetarized agricultural income of the indigenous population. In 1959, for example, there was a farm equipment park in Tanganyika consisting of 40 tractors (including 8 crawler heavy goods vehicles over 45 hp, while the other 35 hp 40 hp machines were of the medium type on tires); 40 plows including 24 spans, 20 other tows and 30 spraying machines.

An airfield for small carriers had been set up as a paysannat area. And to reduce fallow, we introduced fertilizer. The first cotton plant to be established in Tanganyika is the Filtisaf company, in 1948, precisely in Kalemie. It produced 1 million meters of fabric per month and employed 1,800 workers, including 70 expatriates when it closed, following the looting of sad memory production units across the country in September 1991. In addition, Filtisaf was financing a textile school in Lubuye, still in Kalemie. Then there were the wars (1996-1997 and 1998-2003).

THE GOVERNMENT CONCERNED

Since 2003, the situation of the cotton sector has also been the focus of government attention. In this year, the Ministry of Agriculture organized, in collaboration with the Cotton Stabilization Fund (CSCO), the 2nd cotton technical meeting (27-28 November) to which all stakeholders in the sector were invited. The participants had recommended "the revival of cotton production by the owners of cotton ginning factories as the cotton business is organized around these factories".

From where, it was also recommended to the government to "know the intentions of the owners of the factories at the stop or the abandonment to request, in case of disengagement, their recovery in the rules by the State and their transfer to the new operators who will want to invest in cotton ".

In 2006, the Ministry of Agriculture, Fisheries and Livestock announced the government's intention to "revive cotton farming in the various high-productivity sites of the country, particularly in the Northeast and the West. South East. According to this ministry, it is a question of "rectifying this sector based on favorable edapho-ecological conditions in certain provinces and on an agricultural population interested in this culture, thanks to the return of peace in the country".

While pointing out that "the fall in cotton production came after independence following the various institutional changes in the DRC and the looting of 1991 and 1993". And that "before the accession of the DRC to independence, cotton represented 14% of the value of agricultural exports and 5% of the country's total exports".

Coton: Les défis pour une relance de la production en RDC

Pour les besoins nationaux en textiles et en habillement, le pays dépend encore entièrement des importations de tissus (pagne) de Chine ou du Nigeria, et de friperies. Pourtant, la République démocratique du Congo a un potentiel important pour la production cotonnière.

Celle-ci offre des avantages très important dans le cadre de la réduction de la pauvreté, car cette culture est très bien adaptée à la production par les petits exploitants, ainsi qu’en matière de sécurité alimentaire puisqu’elle rentre en rotation avec les cultures vivrières qui profitent de l’engrais nécessaire financé par le coton. Les spécialistes pronostiquent qu’il est difficile de relancer cette culture à court et à moyen termes.

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Did you know that in 1990 there were seven textile factories: Texaf, CPA, Solbena, Sotexki, Sintexkin, Fitisaf and Novatex. Between 1990 and 1996, four companies put the key under the mat. There are only three left on the market, including Texaf, Sotexki, and Sintexkin.

DEMOCRATIC REPUBLIC OF CONGO
Country’s Last Textile Factory Hangs by a Thread
Cheap imports and customs roadblocks have driven a once-thriving industry to the edge of extinction.

KISANGANI, DEMOCRATIC REPUBLIC OF CONGO — Massive white warehouses line the Tshopo River at this lush green site on the outskirts of Kisangani, birds singing all around. Here in the northeastern part of the country lies the Société Textile de Kisangani, or Sotexki, DRC’s only remaining textile factory. Inside, machines lie idle, silence broken only by the murmur of a few workers.

DRC’s cotton industry has seen better days. The Belgian authorities began growing cotton as an experimental crop in 1918; the industry peaked in 1959 and remained one of the largest in the agricultural sector in then-Zaire through the 1980s, when 10,000 people worked in 10 textile factories. Inaugurated in 1974, Sotexki was for decades the largest company in the region, known for its iconic loincloth patterns.

Following the various wars of the 1990s, all of DRC’s loincloth factories except Sotexki closed. The lone survivor is now on the brink of joining its former peers: Poor road infrastructure, dwindling investment, lack of state support, and competition from China and India forced the factory to nearly halt production in 2020, according to the factory’s management.

Sotexki’s closure would mark the demise of an industry that was once a source of national pride, and the end of the era in which a significant part of the cotton worn in DRC was entirely local, from seed to dress.

“Everyone is aware of the low production of this factory,” says Glombert Loko, Sotexki’s director. “There are talks about how the machines are in tatters.” Loko was hired in 2016 to revamp Sotexki, albeit with only a fraction of its original capacity. From 2,500 employees in the 1970s, it restarted with 500; from a 1.5 million-square-meter (16.1 million-square-foot) installed capacity, it would use only 261,000 square meters (2.8 million square feet). Since 2020, Sotexki has used just over 65,000 square meters (700,000 square feet).

While a March 2020 decree by the Ministry of Finance exempted it from paying import taxes on new equipment and replacement parts, factory management claims that the Direction Générale des Douanes et Accises, the customs authority, refuses to comply. Sotexki took legal action against the agency through the Council of State, the highest administrative court, which, according to factory management, ruled in its favor on Sept. 16, 2021. Still, Loko says, the agency has refused to comply with the decree and 10 new machines remain stuck in customs. The customs agency didn’t reply to multiple requests for comment.

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Country’s Last Textile Factory Hangs by a Thread

Umoja said:

DEMOCRATIC REPUBLIC OF CONGO
Country’s Last Textile Factory Hangs by a Thread
Cheap imports and customs roadblocks have driven a once-thriving industry to the edge of extinction.

KISANGANI, DEMOCRATIC REPUBLIC OF CONGO — Massive white warehouses line the Tshopo River at this lush green site on the outskirts of Kisangani, birds singing all around. Here in the northeastern part of the country lies the Société Textile de Kisangani, or Sotexki, DRC’s only remaining textile factory. Inside, machines lie idle, silence broken only by the murmur of a few workers.

DRC’s cotton industry has seen better days. The Belgian authorities began growing cotton as an experimental crop in 1918; the industry peaked in 1959 and remained one of the largest in the agricultural sector in then-Zaire through the 1980s, when 10,000 people worked in 10 textile factories. Inaugurated in 1974, Sotexki was for decades the largest company in the region, known for its iconic loincloth patterns.

Following the various wars of the 1990s, all of DRC’s loincloth factories except Sotexki closed. The lone survivor is now on the brink of joining its former peers: Poor road infrastructure, dwindling investment, lack of state support, and competition from China and India forced the factory to nearly halt production in 2020, according to the factory’s management.

Sotexki’s closure would mark the demise of an industry that was once a source of national pride, and the end of the era in which a significant part of the cotton worn in DRC was entirely local, from seed to dress.

“Everyone is aware of the low production of this factory,” says Glombert Loko, Sotexki’s director. “There are talks about how the machines are in tatters.” Loko was hired in 2016 to revamp Sotexki, albeit with only a fraction of its original capacity. From 2,500 employees in the 1970s, it restarted with 500; from a 1.5 million-square-meter (16.1 million-square-foot) installed capacity, it would use only 261,000 square meters (2.8 million square feet). Since 2020, Sotexki has used just over 65,000 square meters (700,000 square feet).

While a March 2020 decree by the Ministry of Finance exempted it from paying import taxes on new equipment and replacement parts, factory management claims that the Direction Générale des Douanes et Accises, the customs authority, refuses to comply. Sotexki took legal action against the agency through the Council of State, the highest administrative court, which, according to factory management, ruled in its favor on Sept. 16, 2021. Still, Loko says, the agency has refused to comply with the decree and 10 new machines remain stuck in customs. The customs agency didn’t reply to multiple requests for comment.

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Country’s Last Textile Factory Hangs by a Thread

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Unfortunately, Sotexki, like all other Congolese companies operating in the formal sector of the economy, is doomed to disappear because of the dysfunction of the Congolese state. Indeed, the sine qua non condition for the development of the economy is the state protection of the national industry in key areas through measures such as increasing import taxes, the promotion of the import substitution industry. Instead, the Congolese state unduly grants customs exemptions to economic operators who import so-called "strategic" products for the economy, even though the strategic nature of these products is never checked. In other words, the state promotes unfair competition to the detriment of its own industry.
Moreover, public institutions are so deficient that it is difficult to speak of the existence of a state in the Congo, let alone a state that can regulate society. In the case of Sotexki, the General Directorate of Customs, which is a public service under the supervision of the Ministry of Finance, decides to ignore the decision of its supervisory ministry, or even a court decision in favor of Sotexki, with impunity. In a normal country, DGDA officials would be subject to at least a disciplinary sanction and at worst a dismissal followed by legal proceedings. But in Congo, everything is allowed and the notion of checks and balances does not exist.

DRC: Government adopts SOTEXKI recovery project estimated at USD 17.5 million
By Rédaction Kinshasa10 September 2022 at 7:29

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The Congolese government has just adopted, during the Council of Ministers held this Friday, September 9, 2022, the project to revive the textile sector starting in particular with the textile company of Kisangani (SOTEXKI), a former industrial flagship in the DRC whose production has fallen from at least 17 million meters of fabrics in 1988 to 400,000 in 2021 and 2,500 workers in 1988, to 350 in 2022.
According to Julien Paluku, National Minister of Industry, the said recovery plan of the Kisangani Textile Company adopted is estimated at 17.5 million USD for an expected production of 10.8 to 12 million meters of fabrics, and 50,000 cotton producers supervised, 300,000 beneficiaries from Tshopo, Ituri, Bas and Haut-Uele.
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For the responsible minister, SOTEXKI's recovery strategy aims at the modernization and rehabilitation of facilities mainly spinning, weaving, finishing and maintenance. In addition, he noted, the training and rejuvenation of staff and technology transfer components were major pillars in the implementation of the plan.
Inaugurated by President Mobutu in 1974, the Kisangani Textile Company has long been considered the Gecamines of the Great Oriental. Currently, the company is in the process of closing its doors. Its annual production represents only 4.3% of its initial installation capacity.
Serge SINDANI