The textile industry always has been a “feast or famine” business, but the past couple of years have brought more severe changes than ever before, says Vern Tyson, director of operations for National Textiles in Winston-Salem, N.C.

“Recent events are unprecedented in the history of our industry, The textile industry has deteriorated rapidly in recent years,” said Tyson at the Southeast Cotton Conference in Raleigh, N.C.

No one, he says, predicted the situation would become as dire as it is today. “Back in 1998, my company brought in consultants to help project what the U.S. cotton industry would look like in the next few years. Their projections never had U.S. mill consumption much under nine million bales per year. Their worst-case scenario of domestic cotton consumption was not as bad as it is today. No one could imagine what would happen to us in the next few years,” says Tyson.

The period from 1992 to 1997 was a prosperous time for the U.S. textile industry, he says. “Mill shipments were at record levels, and profits reached $2.1 billion in 1992. And the industry stayed strong through 1998. Our raw material consumption was up 30 percent during this time.

“And as an industry, we spent about $25 billion to stay competitive. My company probably has spent an average of $50 million per year for the past three or four years, and that's what it takes. We've seen many breakthroughs in technology in recent years, and we felt it was important — as did other companies — to stay current,” says Tyson.

As a result of modernization, U.S. textile productivity has increased by nearly 40 percent in the past 10 years, he adds. Then, the industry “ran into” 1997 and 1998, he says.

“Basically, Asian currencies collapsed. Those currencies were down an average of 40 percent during this time. At the same time, the value of the dollar was increasing and attracting imports. Textile imports out of Asia increased 80 percent. We tried to keep prices down and keep market share, but we were largely unsuccessful,” says Tyson.

In the past few years, the U.S. textile industry, he says, has lost more than 100 plants, and that number continues to grow. “Several companies are filing Chapter 11. And, most recently, we saw K-Mart filing bankruptcy, and they're one of our customers' customer. It's a tough time in our business.

“We've lost 60,000 jobs in the last year alone, and we've experienced the worst business downturn in more than 50 years. We did move some operations to Mexico and the Caribbean Basin to try and remain competitive, but those efforts have been largely unsuccessful.”

In June of 2000, there were more than 900 claims for unemployment benefits from textile works, says Tyson. In June of 2,000, the number of claims rose to 11,000. The year 2000 marked the U.S. textile industry's first annual loss, at more than $350 million, he says.

Looking towards the future of the industry, Tyson says U.S. textiles must have a “level playing field” with other trading countries.

“We must continue to move labor-intensive operations out of the United States. Most of this already has been done. We, as a company, make fabric. But that fabric is assembled 100 percent out of the United States. We just can't afford to pay the kind of rates we'd have to pay here in the United States and stay competitive in the world.”

Tyson also sees more consolidation in the future as smaller companies drop out of the industry. “We think the core industry probably is okay under the current rules. And, we think the core domestic industry will consume about seven million bales of cotton annually. But we haven't yet seen the end of this.

“USDA estimates U.S. consumption at about 7.5 million bales. We think that number will settle at about seven million as long at the rules stay the same. If tariffs are removed for some importing countries, we'll drop further to the four to five million bale range. We don't see that recovering — we think that's where it'll be.”

The world has changed dramatically since the terrorist attacks of last Sept. 11, notes Tyson. “We're more uncertain now of the future than ever before. But U.S. cotton is, by far, the ideal cotton. We've run some imported cotton over the years, and we have trouble every time we do it.”