Canadian Textiles

• The Market
• About Canadian Textiles
• The Industry
• Adoption of e-Business
• Investment Policy
• Canada - Open for Business
• Investment Services
• Sources of Financing
• Trade Policy
• World Trade Organization (WTO)
• North American Free Trade Agreement
• Canada-Chile Free Trade Agreement
• Canada-Israel Free Trade Agreement
• Canada-Costa Rica Free Trade Agreement
• Duty Remission
• Canadian International Trade Tribunal

The Market

The textiles market in Canada fell in 2004 from the previous year, edging down 1.3 percent to $8.9 billion. In the four-year period of 2000-2004, the market experienced a decline of 14.7 percent. Domestic shipments of $3.2 billion accounted for 35.9  percent of the market in 2004, a decrease of 2.2 percent from a year earlier. Imports of $5.7 billion accounted for 64.1 percent of the market, an increase of 1.3 percent from the previous year.

⁽¹⁾ Apparent Canadian Market equals Domestic Shipments + Imports (return)
Source: Apparel & Textiles Directorate, Manufacturing Industries Branch (MIB), Industry Canada, and data from Statistics Canada.

Canadian textiles manufacturers continue to lose market share to offshore suppliers. To offset some of the loss of market share, domestic manufacturers continue to look to export market expansion. In terms of exports, their share of total shipments of 49.9 percent in 2004 was 9.9 percent higher than four years earlier.

Source: Based on data of Table 1:1.

Notwithstanding a rising export market share over time, textiles exports of $3.2 billion in 2004, while virtually unchanged from a year ago, were about 5 percent lower than in 2000. By sectors, exports of manmade fibres/filaments fell 6.3 percent in the four year period, exports of textile mills fell 7.2 percent but exports of textile products mills edged up 0.9 percent . In terms of textiles imports, they increased their share of the Canadian textiles market to 64.1 percent ($5.7 billion) in 2004. While almost unchanged from a year earlier, textiles imports declined 11.3 percent to $5.7 billion in 2004 from $6.5 billion in 2000. By sectors, imports of textiles mills in 2004 fell 24.6 percent from four years ago, manmade fibres/ filaments fell 15.7 percent, but textile products mills rose 13.1 percent. Canada continues to carry a trade deficit. In 2004, the aggregate textiles trade deficit stood at $2.5 billion based primarily on trade between Canada and the United States.

About Canadian Textiles

The Canadian textiles industry, established over 150 years ago, is one of Canada's oldest manufacturing industries. Located in small, urban communities that offered a stable labour supply and rivers ideally suited for water-generated power and dyeing/finishing, the industry began by manufacturing yarns and fabrics from natural fibres. Currently, the industry is found mainly in Quebec and Ontario, is heavily capital-intensive, processes natural, artificial and manmade fibres and filaments into consumer, household and industrial textiles, and supplies over 150 customers in Canada and worldwide.

"Canada's textile manufacturing industry has transformed itself in the last twenty to twenty-five years through substantial and sustained capital investment. The result: an industry that is modern, efficient, increasingly capital-intensive, a major user of high technology and a provider of quality jobs for thousands of Canadians. Innovation and investment are the key to the industry's future success in the global trading environment and to its continuing contribution to the health of the Canadian economy"-- Liz Siwicki, Executive Director, Canadian Textiles Institute

The Canadian textiles industry is classified to the North American Industrial Classification System (NAICS) to manmade fibres and filaments, textile mills and textile product mills and comprises:

• Manmade Fibres and Filaments (NAICS 325220),
• Textiles Mills covering: 
  1. Fibre, Yarn and Thread Mills (NAICS 313110)
  2. Broad-Woven Fabric Mills (NAICS 313210)
  3. Narrow Fabric Mills and Schiffli Machine Embroidery (NAICS 313220)
  4. Nonwoven Fabric Mills (NAICS 313230)
  5. Knit Fabric Mills (NAICS 313240)
  6. Textile and Fabric Finishing (NAICS 313310)
  7. Fabric Coating (NAICS 313320), and
• Textile Products covering: 
  1. Carpet and Rug Mills (NAICS 314110)
  2. Curtain and Linen Mills (NAICS 314120)
  3. Textile Bag and Canvas Mills (NAICS 314910)
  4. All Other Textile Product Mills (NAICS 314990)

Motor vehicle fabrics manufacturing is excluded in IC's definition of the textiles industry. Classified to the motor vehicle interior system sector (NAICS 336360) of the Transportation Equipment Manufacturing industry, this sector employs some 7 thousand workers and ships about $1.9 billion worth of industrial fabrics annually.

The Industry

According to Statistics Canada, the Canadian textiles industry in 2004 comprised some 1,518 establishments, employed about 35 thousand workers, and shipped $7.3 billion of textiles. The industry accounted for 1.2 percent of manufacturing Gross Domestic Product, 1.2 percent of manufacturing investment and 2.4 percent of manufacturing employment.

Aggregate textiles shipments continued to decline with a noticeable decline of 12.3 percent in 2004 from one year ago, and of 13.2 percent in the four-year period of 2000-2004. All major sectors contributed to the latest decline. In the four-year period, shipments of manmade fibres and filaments declined some 5.2 percent, falling from $899.8 in 2000 to $853.3 million in 2004, textile mills fell 7.4 percent from $4.1 billion to $3.8 billion, and textile product mills dropped 6.8 percent from $2.8 billion to $2.7 billion.

The Canadian textiles industry's investments in machinery and equipment and its labour skills upgrading reflect the industry's drive to sustained international competitiveness The industry is capital intensive with larger investments by manmade fibres/ filaments producers and textile mills and smaller investments by textile products mills. As well, investment expenditures are concentrated among larger textile companies. In 2004, the textiles industry reported investments of some $352.5 million, of which about 66.5 percent ($234.4 million) occurred in textiles mills, and 33.5 percent ($118.1 million) in textile product mills. While Canada is not a textile machinery manufacturing country, the industry has full access to worldwide textile technology, acquires new technologies and undertakes further process R&D and customization of new technology

To encourage further investments by Canadian textile companies, Canada in February 2004 introduced CANtex, a three-year $26.7 million initiative to help Canadian textile manufacturing firms become more competitive and ready to take advantage of new opportunities. In December 2004, CANtex was expanded with $50 million of additional funding over five years to encourage Canadian textile companies to shift to higher value-added products, focus on niche markets and improve productivity. See: Government of Canada Introduces New Measures to Increase the Competitiveness of the Textile and Apparel Industries

The industry is committed to Continuous Quality Improvement of workers and management. Established in 1994, the Textiles Human Resources Council (THRC) is mandated to ensure that textile workers acquire world-class textile skills. THRC is active in upgrading essential skills; providing technical training; developing a training culture within the industry; and promoting better understanding of the textiles industry. Its senior officers are: John Saliba, Executive Director, Textiles Human Resources Council, 500 - 222 Somerset Street, Ottawa, ON K2P 2G3, john.saliba@thrc-crhit.org ; 613 230 7217 (Tel), 613 230 1270 (Fax); Adrian Spoerry, Co-Chair, THRC, and President and CEO, Hafner Inc, P.O. Box 3000, 379 Racine Street, Granby, QC J2G 8G2, aspoerry@hafner.ca , (450) 372-6862 (Tel), (450) 372-6925 (Fax); and Pierre-Jean Olivier, Co-Chair, THRC, and National Representative, Travailleurs et Travailleuses Unis de l'Alimentation et du Commerce, 301-8920, boul Pie IX Montréal, QC H1Z 4H9, pjolivier@hotmail.com , Tel: (514) 326-8822 Cell: (514) 949-3202, Fax: (514) 326-1226.

Adoption of e-Business

With the rise of the electronic economy, e-business has become an essential practice to promote viable and internationally competitive apparel and textile industries in Canada. Policies and practices of industry and government need to coalesce to maintain a healthy environment for e-business to grow. Canadian textiles manufacturers need to go boldly into required electronic systems and equipment, and provide continuous employee e-training.

Regarding the drive to an e-business textiles industry, The Canadian Textiles Institute (CTI), the National Association representing Canadian textiles manufacturers, is uniquely situated to create and implement a textiles-specific electronic portal (portal) to serve as a one-stop access centre for business information, analyses and policy information affecting the Canadian textiles industry. CTI's primary objectives in creating the portal are:

1. to raise the industry's profile in Canada and worldwide towards expanding business and promoting partnering opportunities for textiles firms; and
2. to keep industry players updated on industry and trade news, events and issues.

The industry-specific features of the portal will include:

• a profile of the Canadian textile industry to provide a basic, generic overview of the industry;
• a listing of news items pertaining to the industry covering original content as well as links to other relevant news sources;
• an industry events and trade show calendar highlighting events and shows of interest to the industry in Canada and abroad;
• events registration (as applicable);
• industry directories to serve as the basis for online searches and listings;
• company web-pages to give firms an effective presence on the portal including, as applicable, links to their own company sites; and
• links to key industry organizations and resources (including overnment departments and agencies).

Other features being considered for inclusion are:

• the possibility of incorporating on-line showrooms for Canadian producers;
• online survey tools that will enable CTI and potentially other industry organizations to obtain input and views on selected issues;
• industry sales and promotion listings to provide expanded opportunities for companies to make their products/ services available online;
• classified advertising;
• message boards;
• banner ads;
• specialized content (including information and/or resources of interest to specialized groups of individuals of companies); and
• assistance to companies in creating websites.

Finally, the portal will incorporate links to related organizations' websites, including the CTI, the Textiles Human Resources Council (THRC), the Centre for Textile Technology (CTT), operating as a complement to their sites.