Apparel Industry Hangs by a Thread as Yarn Prices Rise | Coimbatore News
The rise in yarn prices is due to the limited supply of cotton in the market, industry sources said. On Monday, the 40s yarn was sold at Rs 434/kg, against Rs 237 last May.
Although the Union government removed import duties on cotton through a notification issued on April 13, factories in the region, which have reserved cotton outside India, are waiting for the goods are dispatched.
“The shipping process will take at least three months. So mills that are currently placing cotton orders will only receive delivery after a few months,” said RK Nachimuthu, Managing Director of Murugan Textiles at Palladam.
Until the order arrives, the directions of the spinning mills are obliged to apply certain strategies, taking into account the minimum availability of cotton. by reducing production, minimizing speed, shutting down the spindle at peak times and providing workers with vacations, Nachimuthu said.
Rising yarn prices reflect demand and supply for cotton, said C Dhandapani, chairman of the Tirupur Hosiery Yarn Merchants Association. “Revised rates announced on Monday noted a rise of Rs 40 across the board. Due to this condition, products like dhotis, lungis and stockings can become expensive. At the end of the day, the common man will suffer.
However, Raja M Shanmugham, chairman of the Tiruppur Exporters Association (TEA), said he had no idea how the rates were continually being increased, although there were no major changes. in the quantity of production. “There was not much difference in the quantum of cotton production compared to two years ago which was 3.40 lakh bales per year. The logic behind this price hike needs to be analysed.
Garment industry representatives are planning a meeting on Tuesday to analyze the situation, Shanmugham added.
G Venkatesan, general manager of Soundar Textiles, said there is only an “overnight” amount of cotton stock in the mills that will only last for a few weeks. “We are keeping our fingers crossed to see the price of cotton crashing like it happened in 2010. The price per cotton candy touched Rs 60,000 in five months in 2010. But the price crashed to Rs 35,000 after 35 days. Knitwear exporters will be more affected as they have to stick to the price they offered in the initial process, despite the increase in yarn tariffs.