Textile minister forces spinners to cut yarn prices
April 26, 2010 - Bangladesh
If the country’s spinners fail to reduce the prices of yarn, an important indirect raw material for producing clothing, by Monday midnight, then Bangladesh Textile Minister, Abdul Latif Siddique, would open up the Benapole land-port to import cheap Indian yarn into the country.
According to the minister, yarn prices in the domestic market were exorbitantly high, owing to spinners cashing on an unstable international cotton market and a decade-old protection that was granted by the government.
After a meet with the spinners, textile millers, power loom owners and garment producers, Siddique said that the market, according to him, looked inconsistent and that the spinners were charging unjust prices.
Giving the textile spinners time till Monday midnight, to think over his proposal, Siddique informed that, “I have asked the millers to approach me with a reasonable rate that can help even out yarn prices, or else, if necessary, we will open the Benapole land-port for free imports of yarn.”
It was only after the power loom owners and the garment producers lodged complaints against the country’s spinning mills that, the spinners had formed a group and were charging exorbitant rates for their yarn, that the minister decided upon the Benapole proposal.
However, the minister stressed that the Benapole land-port will not open unless the situation demanded. More so, the textile spinners were urged to even out the yarn prices in accordance with the global cotton prices.
The Benapole land-port, country’s biggest customs station, was closed for yarn imports since late 1990s in order to protect the domestic spinners from a volatile competition from their Indian counterparts.
As Indian yarn producers are one of the biggest manufacturers of cotton, domestic spinners from Bangladesh dread to compete with them. In addition, these spinners buy cotton from foreign markets to produce yarn, leading to increase in costs.
According to Siddique, increase in yarn prices would ultimately affect the textile spinners as they would be unable to find buyers.