Cap Yarns CEO outlines council’s priorities, including made-in-America PPE, more
Posted March 31, 2021
Editor’s note: Following is a Q&A with David Roberts, CEO of Cap Yarns, Clover, S.C., who was reelected chairman of the National Council of Textile Organizations (NCTO) for a second term during its virtual Annual Meeting on March 24. His responses come in response to questions posed by eTC Publisher Devin Steele.
eTC: The last year has probably been the most unusual in modern times, of course, but the U.S. textile sector showed its true value, spirit and resilience during the pandemic. What are your thoughts on the industry’s efforts to step up, collaborate and answer the nation’s call?
Roberts: During my tenure as chairman of NCTO, I have witnessed the truly incredible and innovative spirit, resiliency and determination of our industry as it confronted and subsequently provided solutions to a once-in-a-generation healthcare crisis in our country.
This industry answered the call of the nation for personal protective equipment (PPE), quickly retooling production lines to produce millions of desperately needed face masks, isolation gowns, testing kit swabs and other critical medical products for frontline health care workers.
To that end, the industry has demonstrated the full spectrum of its capabilities and innovative spirit throughout this pandemic, while companies simultaneously confronted challenges of their own, including idled capacity and furloughs, stemming from the sharp economic downturn.
Through it all, U.S. textile companies have invested in costly restructuring initiatives at their own expense without guaranteed purchase orders for PPE from federal, state or local governments.
Today, the domestic textile sector is bouncing back as business increases at a rapid pace and I am proud that our members have withstood the worst economic contraction in decades and risen to the challenges and calls for PPE.
I am optimistic about the future, knowing that I am part of an industry that made such an incredible commitment to our nation, along with the willingness to come to the aid of those in need.
eTC: Stepping up to serve the U.S. textile industry’s national advocacy group, especially during these unprecedented times, is admirable. What does having a leadership voice in the NCTO mean to you?
Roberts: I am the CEO of a small textile manufacturer – Cap Yarns – and I think as chairman of NCTO, I can give voice to all producers – from small to medium and large businesses alike.
That said, I work in conjunction and have tremendous respect for the leadership of NCTO President and CEO Kim Glas and her staff, who have worked tirelessly throughout the pandemic to serve the needs of our industry.
Under Kim’s leadership, NCTO’s coordination and participation in high-level discussions with the administration, Capitol Hill allies, industry and labor groups and other stakeholders was unparalleled.
Through that leadership, NCTO has carved out a seat at the policy table in Washington and that is critical in terms of ensuring our industry’s interests are represented and reflected in critical policies and legislation.
eTC: We’re still faced with a lot of uncertainty around the pandemic and the new administration’s legislative agenda, of course, but please share your thoughts on the outlook of the industry, particularly on the heels of what we’ve witnessed the industry accomplish over the last year.
Roberts: I think the outlook for the industry is positive, not only from a policy and legislative aspect, but also from a business perspective.
In just the first few months of the Biden administration, we have seen executive orders supporting Buy American government procurement policies and supply chain reviews and we have heard top administration officials outline a worker-centric approach. We have also seen a continuation of efforts to block textile and apparel imports from China that are made with forced labor.
We are encouraged by these actions. NCTO will continue advocating for policies and legislation that help onshore PPE production and establish a permanent supply chain, while also pressing the new administration to keep goods produced by slave labor from entering our market.
According to key economic indicators such as retail sales, consumer demand and manufacturing activity, the U.S. textile industry is well positioned to take advantage of rising orders and demand. The industry has also reported growth for the past several months and is gradually recovering.
In addition, the sourcing paradigm has been changing for some time and I think retailers and brands have to take into account new strategies such as onshoring to the U.S. or Western Hemisphere to be prepared for the next pandemic and continue diversifying their global supply chains.
eTC: The NCTO recently signed a letter that also include a broad coalition of industry organizations and labor unions that was sent to President Biden and congressional leaders outlining recommendations on specific policy initiatives that must be adopted to reestablish a permanent PPE industry in the U.S. Has there since been any movement or further conversations on that front?
Roberts: The industry and union coalition letters outlining policy recommendations were sent to President Biden and Congressional leaders in the House and Senate at the end of January.
The coalition stressed in those letters that the permanence of PPE production is contingent upon the “development of government policies designed to help domestic manufacturers survive the current economic crisis and incentivize the long-term investment needed to bring PPE production back onshore.”
If these critical policies are not implemented, the progress made over the past year to onshore a PPE industry will evaporate in the face of China’s global manufacturing dominance in the PPE sector, the coalition said.
To sum up the policy recommendations, the coalition stated the administration and Congress must establish a Berry Amendment for PPE; incentivize private sector purchases of U.S.-made PPE; provide funding assistance for companies to reconstitute domestic PPE supply chains; and implement several best procurement practices, such as an executive order requiring federal PPE contract be awarded for products manufactured under the Berry amendment criteria and the use of “Best Value” as opposed to “Lowest Price” selection criteria for PPE awards to ensure U.S. producers are not continually undercut by offshore suppliers.
In terms of tangible results, NCTO’s engagement with key congressional offices led to the introduction of four PPE-related bills in 2020.
The top priority legislation for NCTO this year is the American PPE Supply Chain Integrity Act sponsored by Rep. Patrick McHenry (R-N.C.) and Rep. Bill Pascrell (D-N.J.).
The bill was re-introduced on March 1 in the new session of Congress and NCTO will work closely with the co-sponsors of the legislation to advance it.
We need a new procurement requirement modeled on the Berry Amendment that requires all federal purchases of PPE and critical medical supplies to meet a 100% U.S. content and labor standard.
This legislation would apply such a requirement to the departments of Health and Human Services, Homeland Security and Veterans Affairs.
NCTO and the coalition continue to have ongoing discussions with high levels of the government to advocate for the policy recommendations and we are optimistic that we will see more action in the coming months.
eTC: In addition to the reestablishment of a permanent made-in-America PPE industry, what are the council’s other policy priorities in general to advance the continued health and prosperity of the U.S. textile industry?
Roberts: There are numerous policy and regulatory matters that NCTO will engage in this year, including:
Efforts to better regulate and enforce Section 321 “de minimis” tariff waivers on all imports of textiles and apparel;
Efforts to maintain Section 301 China tariffs on finished apparel and textile imports;
Efforts to reject any expansion of the Generalized System of Preferences (GSP) for textiles and apparel;
Support to pass the Miscellaneous Tariff Bill on critical inputs not made in the United States while also advocating to keep out products that undermine domestic production;
Continued engagement on new Free Trade Agreement negotiations – Japan, Great Britain, Kenya; and
Continued engagement on the Xinjiang, China forced labor cotton and cotton product ban
eTC: Drilling down into those goals, please specify measures being taken to help ensure successful outcomes; the roadblocks and opportunities; and potential scenarios.
Roberts: NCTO’s overarching objective is to ensure that our members’ interests are fully incorporated in the various textile related policy, regulatory and contracting deliberations currently taking place in Washington, D.C.
Unfortunately, groups that do not share our policy perspective will continue to push their harmful agendas, despite the ongoing pandemic. NCTO will vigorously defend the industry against policies that will put our industry at a competitive disadvantage.
The key to making sure our voice is heard on polices and legislation impacting the industry is consistent and effective engagement, advocacy and amplification of industry issues.
We will continue to provide private sector input on trade agreements and trade enforcement activities and meet regularly with officials in many federal agencies to discuss challenges and opportunities.
NCTO engages daily and weekly with all stakeholders and conducts rigorous follow-ups on scores of issues. For example, in the past couple of weeks we conducted several Zoom calls with members of the House and Senate and their staffs on the policy matters I listed earlier. Due to COVID restrictions all these meetings have been held virtually, but we certainly remain diligent in the effort to get our message in front of key policy makers.
It is our association’s active engagement with the leaders on these policy matters that lead to successful outcomes, such as the improved U.S.-Mexico-Canada Agreement (USMCA) and the favorable changes to the Berry Amendment’s contracting threshold in the National Defense Authorization Act (NDAA) at the end of the year.
eTC: What else is the NCTO keeping its eyes on in the coming months?
Roberts: As mentioned earlier, there are numerous issues requiring NCTO’s focus and resources and I will highlight two here.
NCTO will work to press Congress to pass a new Miscellaneous Tariff (MTB) bill that grants relief on import duties on specified raw materials and intermediate products used in manufacturing that are not produced or available domestically.
The MTB bill lapsed at the end of 2020 and Congress is expected to weigh reauthorization this year.
For textile producers, the MTB provides access to inputs like acrylic and rayon fibers and chemical compounds that are not produced domestically.
NCTO will continue to work with Capitol Hill allies to advance the MTB reauthorization bill and push to ensure it does not allow unnecessary duty relief on sensitive finished textiles.
There will also be continued engagement with the Hill to vigorously oppose attempts by importers to expand the Generalized System of Preferences (GSP) to apparel and footwear.
The GSP program is a trade preference program that promotes economic development for the world’s poorest countries through duty-free access to the U.S. market on a range of designated products.
Apparel brands and retailers have proposed expanding GSP duty-free benefits to all textile and apparel products, including those that will directly compete against apparel made domestically and by our free trade agreement partners using U.S. textile inputs.
eTC: The NCTO does a yeoman’s job disseminating the council’s and industry’s messages not only to lawmakers and policymakers but to the broader populace via social media and other means. Please speak to those messages as they relate to the relevance of a U.S. textile industry and why it’s imperative that people know this.
Roberts: As I have mentioned, NCTO’s staff actively engages with Capitol Hill and the administration to advocate for policies and legislation, ranging from one-on-one meetings with members to congressional factory visits and daily and weekly phone and Zoom discussions. An important element of this engagement is to ensure that we aggressively and accurately portray the strengths and capabilities of the modern U.S. textile industry. We simply cannot allow parties that oppose our policy agenda to promote an outdated and incorrect image of our industry.
As a result, NCTO also has a multi-pronged communications strategy focused on amplifying and promoting the industry’s initiatives and issues through numerous assets, including NCTO.org, its weekly Textiles in the News newsletter, social media channels, direct engagement with Capitol Hill communications offices and highly effective industry video campaigns, among other tools.
We have a small but powerful staff that conveys our messages effectively to all stakeholders in Washington as well as our own members.
Throughout the current crisis, we have demonstrated repeatedly that we have the capacity to make high-quality PPE. In addition to fibers, yarn and fabric for consumer and medical products, the domestic industry supplies nearly 8,000 different textile products for the U.S. military and next-generation textile materials. The U.S. textile and apparel industry shipped $64.4 billion in 2020.
It is imperative that NCTO convey the industry’s importance to the warm industrial base and to our national and health security through a vital PPE production chain.
Our members, many of which are century-old textile firms that have adapted through the decades, provide vital resources, income and investment to local communities and support a vital and dedicated workforce.
For those reasons, NCTO is dedicated to promoting the vital contribution this industry makes to the U.S. economy and the national and health security of our country.
eTC: Please discuss the importance of the NCTO to the industry and the ROI it brings members.
Roberts: NCTO’s strong engagement in Washington on vital policies has demonstrated our organization as a critical leader on issues, and as the chairman, I want to see the organization continue to grow our membership and relevance on Capitol Hill.
It is critical that every company with a stake in a strong North American textile industry become an NCTO member in order to maintain our seat at the table in Washington with a strong and unified voice.
A key aspect of any success we may enjoy as individual companies and as a fully integrated industry involves the need to understand the policies and regulations that govern our companies and our partners both home and abroad.
NCTO provides the unifying and effective voice in shaping those policies that directly impact our businesses and workforce. Every day in Washington, Congress and the Executive Branch are debating issues that directly impact our investment, our workforce and the communities where our production facilities are located. It is absolutely essential that we as an industry remain active and effective within this policy arena to ensure the continued viability and profitability of the industry. NCTO is the means by which we engage in this all-important policy arena and the return on our investment in NCTO is unquestionably substantial.