Home / Knowledge / News / Textiles / Spinners selling cotton yarn at below cost rates
Spinners selling cotton yarn at below cost rates
15
Jun '11
Owing to sluggish demand, the spinning mills are selling cotton yarn at a price, which is 16 percent lower than the production cost. The yarn prices have plummeted sharply over the past few months.

The yarn that the spinners are selling now, was made from cotton procured by them in February 2011 at a price which ranged between Rs. 55,000-63,000 per candy (1 candy = 356 kg). However, the prices have now plummeted to Rs. 44,000-45,000 per candy.

The average price of the standard 40's combed yarn, which at one point soared to Rs. 240-250 per kg, is now being sold by the spinners for Rs. 200-205 per kg.

Actually, yarn stocks started spiralling last year as exports were capped at 725 million kg. This cap was subsequently hiked to 845 million kg, but still stocks went on compounding. The problem of the spinners became so severe that they opted to go on strike in the last week of May this year.

Yarn exports are capped at 845 million kg for this financial year too, but orders are not pouring in plenty. Normally, domestic orders too, remain dull during this part of the year, as the demand for readymade garments shrinks due to absence of any festive or wedding season.

Generally, the demand for yarn as well as fabrics perks up towards the end of the rainy season. Hence, in order to generate some revenue at the moment, the spinners have no other option but to sell yarn at lower rates.

According to the experts, the small-time spinners are the ones who would suffer the most, as the long-term players have a capacity to withstand a 15-20 percent cut in their profit margins.

While no spinning mill would like to sell off its stocks at low rates, some industry people claim that the situation surfaced due to greediness of the spinners. They argue that if the spinners had released their stock for sale in accordance with demand, rather than holding the same in expectation of further price hike, the situation would have been better.

Experts see the yarn market remaining unstable till September-October, after which there is a possibility of the demand rising once again.

Fibre2fashion News Desk - India

Must ReadView All

Textiles | On 30th May 2017

CAI estimates 2016-17 cotton crop at 340.5 lakh bales

Cotton Association of India (CAI) has retained its earlier estimate...

Courtesy: World Bank/Claude Renault

Textiles | On 30th May 2017

India’s economic fundamentals remain strong: World Bank

India remains the fastest growing economy in the world – economic...

Courtesy: Dollar Industries

Apparel/Garments | On 30th May 2017

Dollar Industries registers Rs 906 cr turnover in FY17

Hosiery major Dollar Industries Limited registered a turnover of Rs...

Interviews View All

Shiladitya K Joshi
Truetzschler India Private Limited

India ITME provides a platform to interact with our stakeholders

C. Dhandayuthapani
Mag Solvics Pvt. Ltd

ITME 2016 exploited our full strength like never before

Sanjay Yagnik
Maa Tex Speciality

‘We suggest reducing dosage of sizing chemicals to reduce sludge...

Suresh Patel
Sidwin Fabric

Sidwin Fabric is a manufacturer and exporter of polypropylene textiles and ...

Paolo Ocleppo
Sandvik Hyperion

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

Ashok Desai
Bombay Textile Research Association

Bombay Textile Research Association (BTRA) is a leading name in textile...

Judy Frater
Somaiya Kala Vidya

Among the many honours showered on Frater, including Fulbright and Ford...

Rupa Sood and Sharan Apparao
Nayaab

Nayaab, an exhibition meant to celebrate Indian weaves, is in its second...

Robert Brunner
Devereux

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

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

news category


Related Categories:
May 2017

May 2017

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

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search