Garment exporters face yarn shortage, prices shoot up, Retail News, ET Retail

Lynn Imbier

Chennai: A combination of factors — US ban on Chinese cotton, a sudden surge in orders for clothes, extra stocking up, enhanced exports to Tirupur’s competitors such as Vietnam and Bangladesh — have resulted in yarn shortage for clothes exporters. The scenario is so grim for exporters that Tirupur Exporters […]

Chennai: A combination of factors — US ban on Chinese cotton, a sudden surge in orders for clothes, extra stocking up, enhanced exports to Tirupur’s competitors such as Vietnam and Bangladesh — have resulted in yarn shortage for clothes exporters.

The scenario is so grim for exporters that Tirupur Exporters Association (TEA) has pressed the SOS button alleging that mills had been withholding yarn supplies impacting the export business. “The current determination of mills will surely impact the garment units, exports will largely be impacted and far more number of personnel will incur position losses,” TEA’s president Raja M Shanmugam wrote in the letter. “After the US imposed a ban on Chinese yarn, garment units from Vietnam and Bangladesh (competitors for Tirupur) have started out sourcing from Indian mills. We do not head a rate enhance, but non offer is building a havoc,” he explained to TOI. The US administration has banned the usage of cotton from China’s Xinjiang region, expressing the region makes use of the forced labour of detained Uighur Muslims.

Mills have rejected that they had been channelising yarn for exports. “Due to offer disruptions, firms throughout the value chain, both in exports and domestic markets in the textile sector, started out developing stock of apparels, home textiles , yarn and fabrics to regulate the business continuity. This sudden stock make up is producing shortages,” said Prabhu Dhamodharan, convenor, Indian Texpreneurs Federation (ITF). “This is only a short term stage and no need to have to stress on the availability.”

Yarn rates are mounting. Above the previous a few months, a kilogram of cotton yarn has risen from Rs 205 to Rs 223. “Yarn rate enhance is not commensurate to cotton rate increase. The rate enhance in cotton is steeper. Costs have risen to Rs 43,five hundred a sweet (356 kg) from Rs 38,five hundred,” Dhamodharan said. Exporters as well debunked TEA’s expenses.

“There is no need to have to divert or hoard cotton yarn. There has been a sudden need surge coupled with the simple fact that generation has not achieved pre-Covid stages. Many mills are operating at eighty{cbf6da10fac2230370cea9448ed9872290737d25c88b8c8db3eefaf8c399e33d} to eighty five{cbf6da10fac2230370cea9448ed9872290737d25c88b8c8db3eefaf8c399e33d} capability because of to labour shortage. Desire is fantastic, but rates have not run absent,” said P Nataraj, MD of KPR Mills, 1 of the biggest mills in the region.

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