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RMG manufacturers likely to raise end-product prices further
Dec '10
RMG manufacturers have increased the prices of several textile products, three times in the last two months, as a result of the growing raw material prices. Each time, the rise has been by Rs 25-50.

Since October, prices of several high-end textile products have increased by Rs 100-150 whereas in case of mid-end and low-end textile products, prices have increased by Rs 50 and more. Hosiery products have also registered a hike in prices and the increase is by Rs 20-30 per piece.

In spite of the increase in prices of textile products, the operating margins of the producers are expected to remain at risk over the remaining part of the present fiscal year. The ongoing sharp hike in global cotton prices is likely to affect the operating margins of the Indian textile producers adversely, as prices permeate down the entire value chain and finally get reflected in terms of high prices of various textile products.

Cotton prices have escalated spectacularly since August and particularly towards the end of November. Most of the common grades of cotton have registered an increase between Rs 108-118 per kg, reflecting a rise of 60-70 percent from a year ago. Yarn prices have also registered a hike, showing an increase of 15-20 per cent during the same time. Fabric prices have also recorded a growth. As a result of this, garment manufacturers are expected to increase the end-product prices, further.

Fibre2fashion News Desk - India

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