India : Denim prices slashed due to excess production

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Denim prices slashed due to excess production

19
Jun '06

Huge production of denim by India, Pakistan and Bangladesh has flooded the domestic and international markets, and this resulted into a 10 percent fall in denim prices.

Last year, total Indian capacities have increased from 200m metres per annum to 350m metres per annum.

Plant of Arvind Mills has been running at 85 percent capacity from 92 percent about three months ago.

Denim capacities at Raymond increased by 10m metres to 40m metres, and JV with UCO, a Belgian company, have further enhanced its capacities to 80m metres.

Recently, Century Denim has doubled its plant to 20m metres and is ready to launch its domestic brand.

Denim production is on the rise in Bangladesh, Pakistan and China which are expanding their capacities resulting in a supply flood.

This has led manufacturers to turn their focus on domestic market, which offers a respite with slightly better prices.

In this set-up, garment manufacturers find it more gainful to import fabrics as they do not have their own capacities.

Industry experts estimated that denim capacity in the country would see a growth of 65 percent to 600m metres per annum by the end of 2007.

At present, the denim market is growing at 6-7 percent in the international market, and 10 percent in the domestic market.

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