As the House of Representatives approved a one-year extension of two preferential trade programs —
and the Senate is expected to do the same later this week — Congress has postponed action on some
of the controversial issues surrounding the programs.

The House-approved legislation is a simple one-year extension of the current General System
of Preferences (GSP) and the Andean Trade Preference Act. US textile and apparel manufacturers and
importers had sought a longer extension that they believe would facilitate longer-term sourcing and
remove some of the uncertainties from the marketplace.

Textile manufacturers were concerned about an effort to grant zero-tariffs to textiles and
apparel from Cambodia and Bangladesh and the possibility that textiles and apparel would for the
first time be subject to GSP duty-free treatment. Importers were recommending a single rule of
origin for all products that would undercut the textile industry’s hard-won yarn forward rule of
origin that is part of key bilateral and regional free trade agreements.

While neither textile manufacturers nor importers are entirely pleased with the one-year
extension, they say it is better than letting the preference programs expire December 31 as
scheduled. They expect the larger issues to be addressed next year as part of a more comprehensive
legislative package dealing with a wide range of trade issues.

December 15, 2009

For two centuries, Swiss machinery manufacturer Rieter concentrated on textile machinery in
general, and on machinery for the whole spinning process in particular. Over the last 20 years,
Rieter expanded its operations with activities in the automotive industry and nonwovens. Some 10
years ago, Rieter bought France-based Perfojet from ICBT and its owner, Bernard Terrat. According
to Erwin Stoller, CEO of Rieter Spinning Systems at that time, the reason for the takeover was to
have a more balanced product portfolio. In the ever-so-volatile textile machinery market, the
acquisition was welcomed by the industry and considered to be a clever step to share the risks in
one particular sector.

Back To The Roots

Those times are now past. Yesterday, Rieter Group announced that it signed a contract on
December 11 with Austria-based international technology group Andritz to sell Rieter Perfojet
S.A.S. This time, the message states the divestment was made “in the context of focusing on core
activities in the Textile Division of Rieter.”

Located in Montbonnot, France, near Geneva, Rieter Perfojet develops and manufactures
nonwovens production machinery and systems. The company has 50 employees, and its annual sales
total some 40 million Swiss francs. The company’s well-known products and technologies are marketed
under the JETlace® and SPUNjet® brand names. Rieter Perfojet has a reputable name in the
marketplace, and the production lines are used globally for the hydroentanglement of nonwovens, the
so-called spunlace products.

Financial Problems

In the past month, Rieter Group has been repeatedly in the news for its financial problems.
According to some internal sources, these difficulties were over in recent weeks. However, Rieter
Group stated in its release that “as a consequence of the current economic crisis Rieter has
intensified its efforts to concentrate its resources in the Textile Division on its core
competencies in the field of spinning machinery for short staple fibers, together with technology
components and service offerings. The parties have agreed not to disclose the purchase price.
Completion of the transaction is subject to the consent of the anti-trust authorities. This is
expected at the beginning of 2010.”

Andritz

The new owner, Andritz, with more than 13,000 employees and 2008 sales totaling some 3.6
billion euros, already operates in the nonwovens sector through its Germany-based subsidiary
Andritz Küsters GmbH. With the acquisition of Rieter Perfojet, the portfolio of Andritz Küsters
will be further completed.

The famous name Küsters is associated with the Swimming Roll (S-Roll). Since it received its
patent in 1956, the roll technology has changed significantly and become further differentiated,
revolutionizing textile, nonwovens and paper manufacturing and finishing processes. Using the
deflection-controlled S-Roll, it has become possible to overcome web processes’ limitations.

In 2006, Andritz took over 100 percent of already named Andritz Küsters GmbH & Co. KG.
Andritz Küsters GmbH has some 480 employees at three locations, in Krefeld, Germany; Bülach,
Switzerland; and Spartanburg in the United States.

December 15, 2009

Five Democratic senators and one Independent are supporting legislation calling for sweeping
changes in US trade policy, similar to legislation that has been introduced in the House with 127
co-sponsors.

The Senate bill, entitled the Trade Reform, Accountability, Development and Employment
(TRADE) Act, mandates a review of existing trade agreements and provides for more Congressional
involvement in future trade agreements as they are being negotiated, and it establishes guidelines
to ensure that all agreements are effectively implemented.

Sen. Bernie Sanders of Vermont, the Independent sponsor of the bill, said: “As a result of
our disastrous trade policy, millions of decent jobs have been shipped overseas, turning American
jobs into our number one export. We need to do everything possible to reverse this trend and
develop a new trade policy that reduces our record-breaking trade deficit and increase American
jobs.”

Other sponsors of the bill are Sens., Sherrod Brown, D-Ohio, Bob Casey, D-Pa., Byron Dorgan,
D-N.D., Russ Feingold, D-Wis., and Jeff Merkley, D-Ore.

Like the House version of trade reform legislation, the Senate bill directs the US Government
Accountability Office to conduct a comprehensive review of existing trade agreements with an
emphasis on economic results, enforcement and compliance. It also spells out standards for labor
and environmental protection, safety standards and national security considerations. Another key
provision calls for the President to submit a negotiating plan to Congress prior to entering into
negotiations and provides for more congressional oversight with respect to implementation of
agreements.

December 15, 2009

US textile manufacturers have urged Congress to eliminate some textile products from the list of
products slated for duty-free treatment under a miscellaneous tariff bill, claiming the products do
not qualify for such treatment. Both the House and Senate are expected to act before adjournment on
legislation granting duty-free treatment for a wide range of products, including textiles and
apparel, that are given special tariff treatment because they do not compete with US-made products.

Both the National Textile Association (NTA) and the National Council of Textile Manufacturers
have objected to nearly 30 product lines because they compete with products made here or are not
eligible for the special treatment under terms of free trade agreements. In addition, they have
suggested that duty-free treatment be given to an additional number of textile fiber products,
which they say that do not compete with domestic products. Those include such things as some rayon
and acrylic fibers, cashmere and camel hair. 

The NTA filing cites opposition to 24 proposed duty suspensions included in the miscellaneous
tariff bill. For example, NTA says some garments made in Costa Rica do not qualify for duty-free
treatment under the Central America-Dominican Republic Free Trade Agreement (CAFTA-DR) because they
are made of fabric from outside of the CAFTA-DR region, and the association points out there are
domestic manufacturers of the fabric. NTA says “CAFTA is very specific in that it requires garments
of this type to be constructed from fabrics that were formed either in the United States or one of
the other CAFTA countries.”

Other bills NTA objects to cover certain women’s sports bras and tank tops made with fabrics
its members make. Other objections are raised with respect to certain warp-knit fabrics and
nonwovens and a number of fire-retardant fabrics.

NTA says the miscellaneous tariff bill is intended to promote US manufacturing by providing
limited tariff relief to domestic manufacturers that use inputs that are not available from a
domestic source, and “not as a vehicle to swell the profit margins of importers and retailers of
finished goods to the discouragement of domestic manufacturing.”

More detailed descriptions of the products in question are available on the NTA daily blog:
http://nationaltextile.blogspot.com.

December 15, 2009

2009 was a very difficult year for the large majority of textile and apparel producers and as a
result, sales for their suppliers of production machinery likewise suffered. For Bierrebi, the well
known producer of automated die cutting equipment to the tubular knit industry, it was no
different. In addition to bad market conditions other forces acted in unison to create the perfect
storm for the Italian company which has been in business for 35 years in the Bologna region. All
major producers of T-shirts, underwear and fleece products depend heavily on their Bierrebi
machines to efficiently produce the enormous volumes required for their operations. It has been a
testimony to the value of Bierrebi technology and to the dedication of the employees, that the
company weathered the storm and has emerged with a youthful and dynamic new ownership. The new
company BRB Italia, SRL will remain privately held with its headquarters located in Pontecchio
Marconi Italy. The exclusive North American distributor of all Bierrebi technology, (machines,
parts, supplies and technical service), Bierrebi International will continue to operate in
Greenville, SC. The company will continue to service its traditional markets with an added emphasis
on finding new applications and applying new technology to the cutting process. 

Press Release Courtesy of BIERREBI INTERNATIONAL

December 11, 2009

Genencor — a manufacturer of enzyme product solutions for a variety of industries, and a division
of Denmark-based Danisco A/S — has added esterase enzyme EcoLight 1 to its PrimaGreen® line of
enzymes suitable for textile processing. EcoLight 1 is a bleaching enzyme designed to produce a
vintage look.

Genencor reports the PrimaGreen portfolio of products — which consists of PrimaGreen Super
for stone-washed effects, PrimaGreen EcoFade LT100 for denim fading and PrimaGreen EcoLight 1 —
allows a textile manufacturer to save on water and energy costs when compared to using traditional
hypochlorite treatment baths. Specifically, using PrimaGreen EcoLight 1 in combination with
cellulase enzyme PrimaGreen Super, Genencor estimates a manufacturer can achieve a vintage denim
look while reducing water usage by more than 50 percent and energy usage by more than 40 percent.
Or, mixing PrimaGreen EcoFade LT100, a lactase enzyme, with PrimaGreen Super reduces water usage by
more than 60 percent and energy usage by more than 70 percent, according to Genecor’s estimates.
(See ”
Genencor
Develops Eco-Friendly Enzyme For Denim Bleaching And Shading,” February 17, 2009) The
company currently is performing a life cycle assessment to quantify the ecological impact of the
PrimaGreen products. Genecor also reports that by using the latter combination of enzymes, it also
is possible to change the cast and bleach sulfur-dyed denim.

“Today, textile manufacturers and consumers are looking for more environmentally friendly
fashions without sacrificing style or quality,” said Glenn Nedwin, executive vice president,
Technical Enzyme Business Unit, Genencor. “The PrimaGreen portfolio of products provides the tools
to create just that kind of apparel.”



December 15, 2009

Lacassine, La.-based Zagis USA — a partnership between majority owner Grupo Zaga S.A. de C.V., a
Mexico-based conglomerate, and several North Carolina textile executives — has completed
construction of its 128,000-square-foot spinning mill in Lacassine and has begun production of
cotton sales yarn. The facility is the first of two mills in Louisiana in which Zagis will invest a
total of $75 million
(See ”
Zagis
USA To Build Cotton Processing Facilities In Louisiana,” June 24, 2008). Combined, the two
mills will employ at least 160 workers by 2012, and the Louisiana Economic Development Department
(LED) estimates the mills also will generate an additional 645 indirect jobs.

“This investment by Zagis USA is huge news for Lacassine and all of Louisiana,” said
Louisiana Governor Bobby Jindal, who participated in the commissioning ceremony. “With this new
facility, we are keeping more of our homegrown cotton in our state and turning it into valuable
textile fibers to create good jobs for our people right here at home. Indeed, instead of Louisiana
exporting our raw goods so others can profit, we are now creating value added jobs here and helping
our farmers at the same time.”

According to Zagis, the facility, which is located in a 200-acre industrial park in
Jefferson Davis Parish in southwest Louisiana, is one of the most modern open-end spinning plants
globally, and yarn manufacturing costs will be among the lowest worldwide, partly because of the
mill’s access to the state’s cotton supply. Annual production capacity will total 50 million pounds
of cotton.

“LED estimates that when the new Zagis spinning mills are in full production they will
utilize up to 15 to 20 percent of Louisiana’s cotton crop to spin yarn,” Jindal said. Zagis has not
announced the location of the second mill.

December 15, 2009

After an active search for buyers produced three potential investors,
(See ”
DyStar
To Continue Production As Bankruptcy Moves Forward,” Dec. 1, 2009), Germany-based DyStar
Textilfarben GmbH has negotiated and signed a purchase agreement for the company and three of its
manufacturing facilities with India-based Kiri Dyes & Chemicals Ltd. (KDCL), a manufacturer of
reactive dyes, and supplier of reactive, acid and direct dyes as well as dyeing intermediates. KDCL
will assume operations at the DyStar Group in Frankfurt, its production sites in Leverkusen,
Ludwigshafen and Brünsbuttel, and 36 international subsidiaries.

The manufacturing facility in Geretsried is not included in the purchase agreement. “We will
continue working on a solution for the Geretsried site, but we are still looking for potential
investors here,” said Stephan Laubereau, attorney, Pluta Rechtsanwalts GmbH, and court-appointed
insolvency administrator, DyStar Textilfarben GmbH & Co. Deutschland KG.

The deal is awaiting regulatory approvals, but both parties hope the process will move
quickly so that KDCL can assume control of the DyStar assets in January, allowing production to
continue seamlessly at Ludwigshafen, and resume at Leverkusen and Brünsbuttel.

It is hoped some 800 Germany-based jobs and another 2,000 international positions will be
saved after the takeover.

“With the help of KDCL we are in a position to offer staff at the sites in Frankfurt/Main,
Leverkusen, Ludwigshafen and Brunsbüttel a transfer company for employment and qualification,” said
Laubereau, together with Miguel Grosser, attorney, Jaffé Rechtsanwälte Insolvenzverwalter, and
court-appointed preliminary insolvency administrator, DyStar Textilfarben GmbH. “If the deal with
KDCL is completed as planned, the latter will likely be able to reemploy the majority of those
released from work as early as mid-January. The exact details of the deal are still being
negotiated.”



December 15, 2009