Home / Knowledge / News / Textiles / High cotton prices – Spinners & weavers cut output
High cotton prices – Spinners & weavers cut output
25
Mar '11
Following a surge in yarn prices, due to the spurt in raw cotton prices and also cap on cotton yarn exports, spinners have been forced to cut operational rates, mainly, due to unusually high inventory levels.

Big spinning mills are holding inventories of around 30 days, followed by mid-sized ones with 15 days. But it is the smaller ones who are facing the brunt as they cannot afford to carry even a day's inventory.

However, experts from the spinning sector opine that, till the time cotton prices were ruling round Rs 50,000 per candy (1 candy=356 kg), they were in a comfortable position.

But after cotton prices scaled the Rs 60,000 per candy mark, yarn prices have not increased proportionately. Only those mills holding old cotton stocks are operating at full rates, while the rest have cut down on production, they informed.

In order to get a first-hand report, fibre2fashion spoke to a cross-section of businesses across the spinning and weaving textile value-chain.

Speaking to fibre2fashion, Mr Jayesh Patel, Owner - Shiv Shakti Tradelink (P) Ltd said, “Businesses have been impacted for sure as the basic raw materials; be it cotton or synthetic fibres, prices have risen exponentially. Due to crude oil prices ruling firm, synthetic fibre prices have skyrocketed, whereas due to dearth of cotton and increased demand, cotton prices are also at their peak.

“Earlier cotton was available at Rs 40,000 Rs per candy; today same cotton prices have shot up to Rs 60,000 per candy. Had it been quoting round Rs 50,000 per candy, it would still have been bearable, but Rs 60,000 per candy, is too high a hike, to be absorbed.

“Obviously this all surmounts to an increase in production costs, leading to a rise in yarn prices. If the basic raw material gets costlier, the hike is definitely passed on to the next stage and thus, the impact is felt across the entire value chain.

“For fabric makers, current yarn prices are high, whereas for yarn makers like us, raw cotton prices are too much. I envisage these happenings to bring down the businesses, he concluded by saying.

“Prices of raw materials like cotton and synthetic fibres have increased to a great extent. It is very essential that these increases in costs are passed on to fabrics and gradually to the garment segment. If not, around 50 percent of the units will face threat of closure”, opined, Mr KA Patel, Vice-President - Ahmedabad Powerloom Owners Association.

Mr Anish Shah of Kalpataru Enterprise and an Ahmedabad-based yarn broker said, “As compared to raw cotton prices which have doubled, yarn prices have not yet appreciated much, which ultimately kills profit of yarn makers, as a result, spinners are cutting down production”.

“This can impact our sales too. Both weaving and spinning sectors are confronting high-price low-profit brunt. Crude oil prices are also rising, due to which, prices of synthetic fibres too have risen. So whether blended or pure, both ways, fabrics making costs have escalated”, he observed.

Must ReadView All

Apparel/Garments | On 18th Feb 2017

Bangladesh apparel sector has 95% local investors: BGMEA

Over 95 per cent of the total investors in the Bangladesh apparel...

Textiles | On 18th Feb 2017

Smriti Irani resolves cutting of carpets issue at ports

During a meeting held with stake holders of the carpet weaving...

Apparel/Garments | On 18th Feb 2017

Andhra Pradesh inks MoUs to set up 12 apparel units

At the recent CII Partnership Summit held in Hyderabad, memorandum of ...

Interviews View All

Prabu Mohanram
Balavigna Weaving Mills Pvt Ltd

The biggest challenge that the weaving industry faces is high price

Claudia Kersten
Global Organic Textile Standard

‘GOTS is a very efficient supply chain management tool, especially for...

Divyesh Mashruwala
Akshar Industries

Surat dominates foiling, embossing and pleating

Iago Castro Asensio
RCfil Distribuciones S.L.

Iago Castro Asensio, International Business Manager of RCfil...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Mark Paterson
Technical Absorbents Ltd

Mark Paterson, R&D manager of Technical Absorbents Ltd talks about Super...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Robert Brunner
Devereux

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

Yash P. Kotak
Bombay Hemp Company

One of the directors of Bombay Hemp Company, Yash P. Kotak, speaks to...

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