Protection Sought For N.Z. Nylon Industry

Press, Volume CIII, Issue 30405, 2 April 1964, Page 5

Protection Sought For N.Z. Nylon Industry

(Neu> Zealand Press association)

WELLINGTON, April 1.

The nylon industry and textile manufacturers would require a certain amount of protection from competitive overseas fibres and textiles if they were to develop as fast and as economically as possible.

This was stated today by Fibremakers (N.Z.), Ltd., in its submission to the Tariff and Development Board’s inquiry on fibres, yarns and fabrics.

“Fibremakers has a considerable investment in the New Zealand textile industry and requires the protection necessary to shield it from competition with overseas spinners who have the advantage of a larger scale of operation, and therefore have a considerable cost advantage. This situation will pertain for some years because of the limitation imposed by the smaller size of New Zealand.” The submission said that the establishment of New Zealand’s own nylon manufacturing industry would encourage the textile trade to produce fabrics and garments now available in other countries but not at present available in New Zealand. Wider Range “Hence New Zealand consumers will have available a wider range to meet their needs. They will be able to purchase the garments and other man-made fibre goods available throughout most of the world,” said the company, whose £2,500,000 nylon manufacturing plant now under construction at Wiri, near Auckland, is scheduled to begin yarn production in December this year. Local production of synthetic fibres and yarns would almost certainly result in a higher domestic consumption than would be the case if only imported supplies were available. This increase would not be at the expense of wool consumption. Based on overseas experience, the company predicted that “The increased consumption of synthetics will in turn result in an increase in the total consumption of all fibres in New Zealand.

“That is, the synthetic sector is not expected to gain at the expense of wool because the bulk of the Increases will be in non-competitive areas.

“The growth in consumption of synthetics has not affected the general long-term trend of wool consumption," says the submission. “This

trend is not expected to be affected by the increased use of nylon and *terylene’ in the future.”

The man-made fibre industry was one of the most capi-tal-intensive of all industries, said the submission. It stated that Fibremakers will be making a fixed capital investment of about £lO,OOO for each of its 170 employees, compared with the £2OOO for each employee invested in the New Zealand food manufacturing industry, £2740 in chemicals, £1520 in metal products, £4020 in paper, £ll4O in textiles and £1240 in rubber.

The company said that additions to plant capacity involving substantial capital outlays must be planned ahead of current level of yarn demand. In the nylon Industry, a period of 18 months was required to procure, install and commission the machines. Therefore planning must be for a minimum of two years ahead. Fluctuations “The fact that nylon is a raw material for the textile industry, which is subject to volatile fluctuations in demand merely aggravates the uncertainty of the timing of the demand growth. “For these reasons, it is necessary to know the extent to which each step in the industry will be protected by the Government”

The company asked the Tariff and Development Board to make the following recommendations to the Government:

“(1) That Fibremakers’ manufacturing activity of spinning continuous filament yarn and staple fibre should be protected by preventing, through import licensing control, the importation of competitive yarns and fibre and staple.

“(2) That import licensing control should prevent the importation of piece goods or nylon blends so that the mar-

ket for nylon fibres, yarns and staples shall be protected. “(3) That liberal licences should be issued to import nylon fibres and yarns supplementary to the range manufactured by Fibremakers. Present Duty “(4) That the existing rate of duty should continue on the tariff items of the goods under reference (fibres, yarns and fabrics of wool and manmade fibres). “(5) That liberal licences to import lerylene’ continuous filament fibre and yarns, tops and tow should be issued so that the market in New Zealand can be developed quickly to a level where local manufacture of the fibres will be economic, at which time it will be undertaken by Fibremakers (N.Z.), Ltd. “(6) That the importation of piece goods of polyester or polyester blends which are competitive with the piece goods now made or soon to be made in New Zealand should be controlled.”