The following article appeared in business.scotsman.com - ONE of Scotland’s leading cashmere experts has warned that the sector must work even harder to maintain its position at the top end of the market, after the World Trade Organisation (WTO) abolished long-standing quota protection opening the market up "to one and all".

Cashmere in battle to retain its world lead

ALASTAIR REED

ONE of Scotland’s leading cashmere experts has warned that the sector must work even harder to maintain its position at the top end of the market, after the World Trade Organisation (WTO) abolished long-standing quota protection opening the market up "to one and all".

Graham Sands, director of the Scottish Cashmere Club (SCC), played down fears that Scotland was under immediate threat from cheap foreign imports but admitted the sector would be "constantly looking over its shoulder" at lower-cost countries such as China, Vietnam and India.

"With the abolition of the WTO agreement from at the turn of the year, the gates are now up," he said. "We’d be stupid to say we weren’t concerned, but then again I don’t believe we’re in immediate danger."

After years of downturn and job losses, Scotland’s cashmere industry is now on the mend. According to Sands, the sector now contributes more than £115 million to the Scottish economy each year, and employs about 4,000 people.

The SCC, which represents 85 per cent of manufacturers north of the Border, sells up to 90 per cent of its output abroad, and according to Sands, "without an export market we wouldn’t have a Scottish cashmere industry".

Since 1974, an agreement has governed who sells how much to whom in the $353 billion (£187.3bn) world trade in textiles and garments. That arrangement ended on 1 January and speculation has been rising that factories throughout the world, particularly in the Scottish Borders, could be hit by cheap cashmere from lower-cost economies.

For several years, Chinese manufacturers, with easy access to the world’s leading source of cashmere fibre in Inner Mongolia plus the advantages of a low-wage workforce, have built up technology and the skills to challenge traditional European producers such as Scotland and Italy.

The WTO said recently said that it expects China to have half the US market within two years, up from about 22 per cent last year.

However, Sands said that while it is "only sensible" to be aware of the competition, it is "not a case of panic stations just yet".

"Yes, it’s far easier for India, China and Vietnam to import into Europe now," he said. "But we have been preparing for this for a number of years, and in my opinion Scottish cashmere is still well ahead of the pile it high, sell it cheap approach of some other countries."

He said "this is a European problem rather than a Scottish problem", and that the SCC - which was founded in 1998 to represent manufacturers such as John Laing of Hawick, Ballantyne Cashmere and Lochcarron Knitwear - has been repositioning itself at the top of the market for a number of years through various marketing and promotional campaigns.

He said one of the SCC’s most obvious successes is the adoption of a "Cashmere Made in Scotland" swing ticket, which, like the famous "woolmark", guarantees the "quality, performance, honesty and integrity of Scottish cashmere".