S&V Weekly Newsletter Vol.3 No.41, October 16, 2017

This Newsletter is sponsored by SAFLIA

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Recovering from the Durban storm

The storm blew off part of the roof of a Palm Footwear warehouse.

The entire staff was involved in the clean-up, working right over the weekend.

Durban (SA) – Palm Footwear, one of the footwear factories hit worst by the storm that devastated Durban on Tuesday last week, is recovering thanks to what MD Rajeev Pattundeen called "a humbling display of staff, supplier and customer loyalty".
       The storm blew off part of the roof of a warehouse housing school shoes for January back-to-school sales.
       All staff worked from Wednesday to Sunday to move stock. While losses were "minimal", he said, the bigger problem was lost production time. The factory will now be working more overtime than normal, and parts of it will operate 24/7, up to and including most of the annual shutdown in December and January.
       He said there would be a 2-week delay in all deliveries, "but we will deliver every single pair of school shoes, as we always do".
       "I'm very proud of our staff," he said. "It was a great display of team spirit. I'm also very thankful for the assistance given by our suppliers, and by the understanding shown by our customers. What could have been a very serious problem for us has actually turned out well."
       The storm affected a number of other footwear and footwear component manufacturers in the Durban south area, notably Isipingo and Jacobs.
       In Jacobs, unit manufacturer Planet Events lost two-and-a-half days of production, a spokesperson said.
       Isipingo took the brunt of the storm.
       Fully moulded EVA footwear manufacturer Havenna was still not working on Friday, and sales manager Peter McDermott said the factory would know better this week when it would be able to resume production.
       Angel Footwear and sister company Reunion Footwear Components, which built dyke-type walls around their factories when they were badly affected by flooding several years ago, escaped serious damage this time.
       Trenzado Footwear was temporarily flooded, but didn't suffer any losses.
       Caprini Footwear MD Sanjay Pattundeen said the factory had "suffered minimal losses because we were able to take action to prevent damage".
       Elsewhere in Durban and Pinetown, most businesses closed early to allow workers to get home, and many had high rates of absenteeism on Wednesday.

Exports: Africa 'best return on investment'

Durban (SA) – The SA Footwear & Leather Export Council says it is clear that other African states are currently by far the most important export destinations for SA-made footwear, chairman Sanjay Pattundeen said on Friday.
       "Quite rightly, there's a major debate at the moment, in government and in the private sector, on 'return on investment', he said.
       "It's clear to SAFLEC that South Africa's footwear exports into Africa are not only the biggest part of our exports, but that they're growing, and that we should concentrate our resources on that business.
       "That doesn't mean that we're not looking at the rest of the world, but it does mean that - with the exception of niche products - those are more medium to long term prospects."

Ethiopia devalues currency by 15% to boost exports

By Reuters. Wednesday October 11 2017
Ethiopia’s central bank devalued the Ethiopian birr by 15% on Tuesday, its first such move in 7 years to boost lagging exports.
       The birr was quoted by the National Bank of Ethiopia at a weighted average of 23.42 against the dollar on Monday, compared to what will be 26.92.
       “The devaluation was made to prop up exports, which have stagnated the last five years owing to the birr’s strong value against major currencies,” Yohannes Ayalew, the bank’s vice governor, told a news conference in the capital Addis Ababa.
       The International Monetary Fund (IMF) and the World Bank, have both repeatedly urged Ethiopia to consider devaluing its currency to boost exports as they are mostly unprocessed products and need to stay competitive on price.
       Ethiopia has operated a managed floating exchange rate regime since 1992.
       The Horn of Africa country is the continent’s biggest coffee exporter but its total export revenue has been falling short of targets for the last few years owing to weaker commodity prices.
       Addis Ababa earned $2.9 billion in the 2017-2018 fiscal year, versus a target of $4 billion.
On Tuesday, the central bank also announced that it has raised the main interest rate to 7 % from 5 % to stimulate savings as well as to counter inflation.
       “The rate was pushed to mitigate the inflationary pressure that could arise from the devaluation,” Yohannes said.
       Ethiopia’s inflation rose slightly to 10.8 % year-on-year in September from 10.4 % a month earlier, according to figures released by the statistics office on Friday.
       Ethiopia’s economy is one of the fastest growing in Africa, with the IMF expecting a growth rate of 9 % for the 2016/17 fiscal year.
       The expansion, however, has mainly been fuelled by huge public expenditure. The government has invested heavily in dams for hydroelectric power, new highways and an electrified railway linking the landlocked nation to a port in neighbouring Djibouti.
       The IMF has said Ethiopia needs to attract more private sector investment to maintain growth. But Addis Ababa has in the past tended to brush off such advice and said it would keep charge of key sectors. - [http://www.theeastafrican.co.ke/business/Ethiopia-devalues-currency-to-boost-exports/2560-4135402-ekm5wc/index.html]

Diary

November 21-23: ATF Trade Exhibition, Cape Town International Convention Centre. Deidre Harte, +27 (0)21 790 5849, atfexpo@worldonline.co.za

Birthdays this week

16/10/1946: Hannes Harding, FC&T Supplies, Pretoria.
17/10/1968: Mehmood (Joe) Mohamed, Rodrigo Footwear, Durban.
17/10/1984: SS Moosa, Shu-Tique Wholesalers, Pretoria.
18/10/1967: Chetan Jeram, Concept Distributors, Pretoria.
19/10/1966: Elize Strauss, Shoe ‘n Do, Reitz.
19/10/19??: Tony Jelinski, retired, formerly Everflex, Pinetown.
19/10/1944: Peter Manley, Secure & Safe Supplies, Durban.
19/10/1965: Björn Jönsson, Lanxess SA, Johannesburg.
20/10/1946: Steve Bassingthwaighte, retired, formerly agent, Cape Town.
20/10/1955: Dave McDonald, Labora Shoes, Durban.
20/10/1948: DK Pillay, Topline Manufacturers, Durban.
20/10/1957: Steve Dai, Bruce & Jason Trading, Cape Town.
21/10/1971: Derek Malcolm Creed, agent.
22/10/1965: Raymond Philander, Nulaw, George.
22/10/1974: Sulaiman Miller, Powerland Group SA Trading, Johannesburg.
22/10/1979: Kevin Govender, Evolution Engineering, Chatsworth.

In Memoriam this week

17/10/2005: Barney Dodo (b. 11/04/1914), Edworks group, Johannesburg.
18/10/2016: Lenny Jacobs (b. 27/07/1946), Lenny Jacobs Sales, Johannesburg.
19/10/2000: Bill Beckley, (b. 20/07/1927), agent, East London.

Do you have any names you’d like to add to our list of birthdays and In Memoriam? Please send the details.

ABSA Agri Trends 11/10: Hides & skins prices

The average hide price over the past week was 0.16% higher at R12.52/kg green. NB* Hide prices are determined by the average of the RMAA (Red Meat Abattoir Association) and independent companies.

Trade Fair dates

For a list of local and international trade fairs covering footwear, leather goods, leather and PPE, visit our website: http://www.svmag.co.za/events.php

Contact us

News & Classifieds: Tony Dickson, +27 (0)31 209 7505, tony@svmag.co.za

Next newsletter: October 23, 2017.

SAFLIA enquiries: Tel 0800SAFLIA * Email info@saflia.co.za * Website http://www.saflia.co.za

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