Persistent escalation in cotton yarn pricing has plunged home textiles manufacturers in Karur into deep uncertainty.
Home textile producers based in Karur buy cotton yarn from mills situated in Coimbatore, Dindigul, Virudhunagar and Vellakoil.
Cotton yarn encountered a sharp spike in June amid the recent West Asia turmoil. Prices climbed by 30% to 40% and a kilogram of high-count yarn was quoted at Rs 400, up from Rs 300 previously.
Textile producers and exporters raised the matter with the Union Government with manufacturers describing the price surge as thoroughly abnormal.
Though the Centre, responding to sector demands, scrapped the import duty on cotton yarn, players within Karur noted the relief had chiefly benefited garment producers based in Tiruppur.
Just as manufacturers and exporters were beginning to absorb the earlier abnormal price hikes, yarn prices climbed yet again. Costs have risen by 10% across the past three weeks, stoking fresh unease amongst producers.
“Persistent escalation in cotton yarn pricing is a genuine worry,” notes P. Gopalakrishnan, president of the Karur Textile Manufacturers and Exporters Association.
“It not only pushes up operating costs but also strains the relationship between buyers and exporters. Furthermore, it carries a knock-on effect across various facets of manufacturing and exporting,” he adds.
“Home textile producers based in Karur, who chiefly export to the US and Europe, reported they had yet to shake off the fallout from recent geopolitical friction between the US and Iran,” The Hindu reported.
Consequently, prices for numerous essential inputs encompassing petroleum-derived products such as polyester, chemicals employed within dyeing operations, polythene and packing materials — witnessed a steep climb.
A fresh rise in cotton yarn pricing had compounded the difficulties confronting textile producers.
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