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Flare-up in yarn prices may hit RMG exports
17
May '10
At a time when exports of ready-made garments are on an upward spiral, the rising prices of cotton yarn, are putting a spanner in the plans of garment exporters, since cost of production is rising with increase in prices of yarn.

Knitwear exports, which are the highest exports revenue generator from the textiles export basket, have posted 15 percent growth, while shipments of woven apparels have ascended by 13 percent in March 2010, from a year ago.

Meanwhile the handloom and powerloom weavers have embarked on a nation-wide strike to pressurize the government to lift the ban on imports of yarn from India, through the Benapole land port, to contain the flare-up in yarn prices.

Speaking exclusively to fibre2fashion, Mr Shahadat Hossain Sohel, Managing Director of Towel Tex Ltd said, “Since November till date, the price of yarn has increased by 64 percent, due to which I have stopped taking new orders.

“Other factors like shortage of gas and electricity have also fuelled the yarn prices. The yarn manufacturers are operating their plants at 55 percent of total capacity, because of gas shortages, which is leading to increase in production costs.

“Most of the units run their plants on generators for 8 to 9 hours per day due to load-shedding of electricity, as electric cuts happen for 10-15 minutes every hour, which affects efficiency and leads to wastage of time and money.”

When asked, what the government is doing to resolve the strike, he said, “Government is reacting very slowly, but I am not aware of their reaction to the strike, but they should decide immediately and give subsidies to yarn manufacturers to cover losses.”

Fibre2fashion News Desk - India

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