On Tuesday the House overwhelmingly passed a bill that would block the import of all cotton from Xinjiang, China, processed by forced labor, the latest in a series of U.S. moves to counter the Chinese government’s persecution of Xinjiang’s Muslim Uighur minority.
“It is time for Congress to act,” said bill sponsor Rep. Jim McGovern, D.-Mass., during floor debate on the bill, which passed 406 to 3 and now heads to the Senate. “We found that the evidence of systematic and widespread forced labor in Xinjiang is astounding and irrefutable — and includes evidence from camp detainees, satellite imagery of factories being built at internment camps, and public and leaked Chinese government documents.”
In July, the Treasury Department sanctioned several companies that grow cotton in Xinjiang, and earlier this month, Customs and Border Protection blocked the import of cotton and other goods from Xinjiang over accusations of forced labor.
More than 1 million Uighurs from the Xinjiang province are believed to be held in internment camps where they are forced to study Marxism, renounce their religion, work in factories and face abuse, according to human rights groups and first-hand accounts from Uighurs. Beijing refers to the centers as “re-education camps” and says they provide vocational training and are necessary to fight extremism.
Major international clothing brands like L.L. Bean, Hugo Boss and Uniqlo are now determining how to root out abuse from their supply chains — a challenge given how much cotton comes from Xinjiang, and how hard it can be to trace the movement of raw materials inside China. Twenty percent of the world’s cotton comes from China, and 85 percent of that comes from Xinjiang.
NBC News, which documented the surveillance and incarceration of Uighurs in a 2019 investigation, has traced the sourcing of Xinjiang cotton by a major Chinese garment company named Lu Thai Textile, which has supplied products to Hugo Boss, L.L. Bean, Brooks Brothers, Esprit and Uniqlo, among other companies.
Up to at least 2019, according to an NBC News review of local state-run media reports, satellite imagery and financial disclosures, Lu Thai Textile’s Xinjiang cotton factory has fed Lu Thai’s global headquarters in Shandong province in eastern China where fabric and garments are produced.
“Lu Thai is one of the most important producers of fabric for the global apparel industry,” said Scott Nova of the Worker Rights Consortium, a non-profit labor rights organization that monitors global supply chains for abuse. “And for years, it has operated a substantial and growing operation within Xinjiang.”
Nova used open source documents to help NBC News track Lu Thai’s cotton supply chain.
“Because most brands and retailers do not disclose their fabric suppliers, there is no comprehensive list available of clients for Lu Thai’s fabric production, but the company’s fabric no doubt ends up in clothes sold under numerous well-known brand names,” Nova said.
“About one in five garments flowing into the U.S. contains Xinjiang cotton. It would be a challenge to identify any major apparel brand or retailer whose supply chain doesn’t run through Xinjiang,” Nova said.
Lu Thai, which has reported annual revenues up to $1 billion, invested heavily in the Xinjiang region in recent years. In 2017 Lu Thai’s own semi-annual report referenced a “Project of 100 thousand spindle spinning production line construction in Xinjiang.”
A Lu Thai press release published the same year on WeChat, a popular Chinese tech platform, describes how the company used a bus to bring local minorities to Lu Thai to pick cotton and shows an images of people working in the cotton field, saying the practice creates a “strong atmosphere of national unity and family.”
Lu Thai’s 2018 Social Responsibility Report said, “In 2018 the company continued the ‘East-to-West Spindle Transfer’ project, and built a 100,000-spindle cotton spinning project in… Xinjiang.”
Lu Thai received a subsidy of over 1 million RMB, or roughly $151,000, for transferring Xinjiang cotton yarn to warehouses outside of Xinjiang, according to the company’s 2019 interim report.
In August, amid increased U.S. and international scrutiny of forced labor allegations in Xinjiang, Lu Thai Textile sold its majority stake in affiliate Xinjiang Lu Thai, owner of the Xinjiang cotton factory, after 16 years. The new majority owner of Xinjiang Lu Thai is the same figure who has been running the factory’s operation since its launch in 2004 — General Manager Li Jingquan, who has also served as the company’s Communist Party committee secretary. In the company’s announcement of the sale, Luthai Textile said the transfer means it will “no longer hold equity of Xinjiang Lu Thai.”
NBC News reached out to Xinjiang Lu Thai through WeChat and an email address on the factory’s cached web page but did not receive a response.
Lu Thai Textile told NBC News in a statement it does not now have “any equity stake or related investment in Xinjiang.”
The statement said Lu Thai Textile does not use forced labor, complies with all local laws, and has an SA8000 certification, indicating high ethical standards during the entire production process.
“Lu Thai Textile is committed to servicing our global clients, while at the same time also strives to act and lead the industry in terms of social responsibilities, which include an ongoing evaluation and improvement of labor conditions. We know we can always do better – similar to other like-minded socially responsible global companies.
The statement does not say whether the company continues to source cotton from Xinjiang province.
“Whatever Lu Thai’s sourcing going forward, and I see in their statement no clear promise to stop sourcing from the Xinjiang Uighur Autonomous Region, their past actions remain a matter of record,” said Nova.
NBC News contacted many of Lu Thai’s international customers to ask about their supply chains.
Hugo Boss told NBC News it asked all suppliers around the world to prove their products don’t come from Xinjiang. The company said in a statement that Lu Thai had “reassured” it that no Xinjiang cotton has ever found its way into the brand’s clothing.
L.L. Bean acknowledged Lu Thai supplies one of its vendors and accounts for “roughly 1 percent of our entire assortment.”
In a statement, L.L. Bean said, “Our global compliance programs and auditors cover every country where a factory makes L.L.Bean-branded product, including China, and we are actively working with our fellow industry leaders, associations and our partners in the region to ensure that our supply chain standards are being met at the highest level.”
Esprit said it found out about allegations of Uighur forced labor in Lu Thai’s operation and ceased any relationship with the company.
Brooks Brothers did not respond to a request for comment on this story, but its website names Lu Thai as a “1818 Club Partner,” as part of the company’s 200th anniversary celebration in 2018. (The web page for the 200th anniversary was last updated on Jan. 11, 2018.)
Uniqlo, owned by Fast Retailing, cited Lu Thai Textile’s headquarters in Shandong as one of its “core fabric mills,” as recently as August 2020. In a statement to NBC News, Uniqlo said “No Uniqlo product is manufactured in the Xinjiang region.”
While no Uniqlo product may be manufactured in Xinjiang, the company did not address concerns about the source of cotton in its clothing. In promotional material last year, Uniqlo touted its “Xinjiang cotton.”
A Chinese embassy spokesperson reached for comment referred to comments made earlier this month by foreign ministry spokesperson Zhao Lijian.
“Lately China has shown with facts and numbers that issues relating to Xinjiang are by no means about human rights, ethnicity or religion, but about counterterrorism and anti-separatism,” Zhao said.
“What the U.S. truly cares about is never human rights. It is just using human rights as a cover to suppress Chinese companies, undermine stability in Xinjiang and vilify China’s Xinjiang policy.”