Home / Knowledge / News / Textiles / Cotton prices boom, effects are seen in loom
Cotton prices boom, effects are seen in loom
01
Jul '08
Spinning mills across the country are reeling under the burgeoning pressure of rising rupee and unreasonably high prices of cotton which rose by 30 percent in the past few months thrusting the industry into a pitfall.

Cotton prices which started escalating since 2007 are taking a toll on the textile industry which consumed about 241 lakh bales of cotton last season, and is finding it difficult to meet its ends now. Prices of Shankar 6 variety in particular has risen from Rs18,000 per candy in 2007 to as much as Rs27,000 early this week.

While on the one hand the cost of production increased by 17 percent, on the other, yarn prices rose by a petty 2 percent. Moreover, demand for domestic yarn from Korea, Vietnam, Egypt, Mauritius and Bangladesh has also reduced considerably resulting in losses for mills and making it impossible for them to run operations for the entire week.

As a consequence, a good number of mills in Tamil Nadu had to cut down on production capacity while leading garment producers like Arvind Mills and Aarvee Denims have been under-utilizing their capacities for the last six months. Others like Ahmedabad based Gujarat Ambuja Exports Limited (GAEL) and Soma Textiles and Industries Limited have reduced their working days to mitigate losses.

In an exclusive interview with Fibre2fashion, Mr P G Makhija, Executive Director of GAEL said, “Non-availability of cotton at affordable rates have forced the company to reduce their working hours of its Himmatnagar cotton yarn unit to six days.”

When asked what they expected from the Government, Mr Makhija asserted, “Cotton exports must be banned and that Government should prevent hoarding of raw cotton to overcome crisis in the domestic cotton market.”

Southern India Mills Association (SIMA), which also reduced its labor hour by 10 to 15 percent, shared similar opinion and reiterated, “We have demanded from the Government immediate suspension of cotton exports till December 31 2008 and remove import duty of 10 percent and Special CVD of 4 percent on import of cotton with immediate effect. We also hope that the authorities would ensure at least 40 percent stock ratio for use and allow cotton export on a quarterly basis, channelising the same through CCI. Banning of futures trading in cotton to avoid speculation and removal of 1 percent incentive offered for export of cotton are some other proposals we have put forward. If the Government fails to take these measures immediately, the situation will worsen and the entire textile industry would come to a grinding halt very soon.”

Must ReadView All

Textiles | On 21st Feb 2017

Net profit at Indorama Ventures zooms 145% in 2016

Net profit at Thailand headquartered and Aloke Lohia led Indorama...

Information Technology | On 21st Feb 2017

ThreadSol launches IntelloBuy & IntelloCut in Vietnam

ThreadSol, the pioneer of enterprise material management for sewn...

Textiles | On 21st Feb 2017

GST to reduce documentation for logistics firms: CBRE

The Goods and Services Tax (GST) is likely to result in a reduction...

Interviews View All

Manfred Mentges
Sedo Treepoint GmbH

We see a higher demand in colour management systems, as customers see big...

Anshul Sood
Oceedee

‘Indian footwear market is nascent and largely a trend follower’

Cyril Pereira
Reed Exhibitions India, organiser of Asian Machine Tool Exhibition 2016

'Major problem in the textile machinery manufacturing industry is the lack ...

Marten Alkhagen
Swerea IVF AB

Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...

Kerem Durdag
Biovation II LLC

Kerem Durdag, CEO, Biovation II LLC, provides an insight into future...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Mike Hoffman
Gildan Activewear SRL

Gildan Activewear, a manufacturer and marketer of branded clothing and...

Madhu Jain
Madhu Jain

She grew up in the walled city of Old Delhi, completed her studies, and...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
February 2017

February 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search