The Rupp Report: Astonishing Investment Climate In The U.S.

From its beginning, the United States has played a major role within the global textile industry.
Cotton has long been a major export product from the U.S. South. Still today, cotton plays an
important role for the U.S. gross domestic product. Organizations such as Cotton Incorporated and
the National Cotton Council of America support the U.S. cotton industry up to the threshold of pain
— at least this is the opinion in other cotton growing countries. And, last, but not least, U.S.
cotton ranks among the top qualities when it comes to long-staple cotton. Pima cotton and the
Supima® brand are appreciated around the globe.

However, people, even so-called experts in the textile industry, often moan that today, it
is not possible any more to be successful in any textile market when there is such strong
competition from Asian markets in general, and the Chinese in particular. Of course, this
misconception also applies in the United States. Well, here is another story from the U.S — and it
is a successful textile industry story:

Strong Associations

Like every business sector, the U.S. textile industry is well organized. The National
Council of Textile Organizations (NCTO), based in Washington, with an office in Gastonia, N.C.,
represents the entire textile sector. The organization states it is domestically focused to ensure
a prosperous future for the U.S. textile sector, and globally positioned to work effectively with
its international allies.

According to NCTO, in 2012, the overall U.S. textile sector, ranging from fiber to apparel,
directly employed 499,000 workers — including 235,000 in textile companies alone — and indirectly
supported one million U.S. jobs.

One thing is astonishing, if one recalls the troubled economic situation in the years since
the big financial crash in 2008: NCTO says that U.S. textile companies have built 23 new plants and
invested more than US$3 billion in new plant and equipment over the last three years. These are
very impressive figures. New facilities include fiber and yarn manufacturing plants as well as
recycling plants to convert textile waste for new textile applications.

Third-largest Exporter

In 2012, U.S. textile shipments were worth more than US$53 billion. Textile product exports,
valued at more than US$17 billion in 2012, have grown by 36 percent, or more than US$4 billion,
since 2009. Net textile and apparel exports totaled US$23 billion in 2012. With these figures, it
is no wonder that the U.S. textile industry ranks third globally as an exporter of textile

Two-thirds of U.S. textile exports were shipped to Western Hemisphere free trade partners
during 2012. The U.S. textile industry exported goods to more than 170 countries, including 24
countries that received goods worth more than US$100 million.

The army is in many countries of the world a strong purchasing power, and not only for
rifles and ammunition, but also for textiles. Many new developments, especially for protective
garments and high-performance fibers and fabrics, were targeted to military purposes. This is also
the case for the U.S.: NCTO says that the U.S. textile industry supplies more than 8,000 different
textile products per year to the U.S. military. In addition, the U.S. is among the global leaders
in textile research and development. New textile materials being developed by private textile
companies and universities include conductive fabric with antistatic properties, electronic
textiles that monitor heart rate and vital signs, antimicrobial fibers, antiballistic armor for
both personnel and vehicles, and temperature-regulating garments that adapt to the climate. These
are just a few examples how creative the U.S. textile industry still is.

Increased Productivity

In spite of all the troubles of the textile industry in the West, the U.S. textile industry
can present some astonishing facts and figures over the last 10 years: According to statistics
provided by NCTO, U.S. textile industry productivity has increased by 45 percent over the last
decade, and the industry is among the top three in productivity increases. And to dispel another
fairy tale about wages in textiles: In 2012, earnings for textile workers averaged 135 percent more
than apparel store workers, and they also received health care and pension benefits.

A troublesome economic situation is one thing. There are two ways to get out of it: either
accept it or fight against it. Imagination and experience have always been a splendid munition for
success. In textiles, they have brought an astonishing investment climate into the U.S.

May 14, 2013