He
said, “Besides price fluctuation, fabric availability has become a
serious issue as weaving units are not making any delivery commitments..He
demanded some sort of control on exports of cotton and yarn and
stressed the need to focus more on value added exports of garments
rather than raw cotton or yarn as the value addition is over six times
if the same amount of fabrics that is being exported is used by
garments exporting units for their export products” ..Commenting on
the issue, Shudhir Dhingra, Chairman and Managing Director, Orient
Crafts, told SME Times, “The prices of yarn is spiraling due to exports
of cotton to the western countries. Indian cotton, which is supplied to
the international market, are of standard quality. It is manufactured
in the western countries and again exported to our country, which is
giving the Indian apparel manufactures tough competition in the market.” ..He
said, “We have told the government to either ban cotton exports or
control high quality cotton exports from going to the western
countries. We requested the government to impose some duty which can
hinder exports of cotton from India. On this till now the government
have not taken any initiative.” ..”It is challenging for small
garment exporters as well as big ones; they can manage it through
number of ways. We at Orient Crafts have reduced our profit margin to
sustain in the market,” Dhingra added ..”There is huge demand for
yarn in the country at the moment. If under such circumstances the
standard yarn are exported out of the country then the finished garment
manufacturers will be into deep pain,” he said ..He expressed the
cotton yarn those are exported from India are manufactured in the
competitive countries and then are sold not only to India but are also
exported to other major key export countries worldwide making India
uncompetitive in the export front ..When asked whether they are
going to increase the prices of finished products further, Dingra
commented, “We cannot increase the prices of the finished products as
we will loose buyers in the market.” ..He said, “The short of
supply in the garment manufacturing is of the final yarn. If there is
no control in exports of yarn and cotton from India, we will loose
market share in near future. We cannot increase our prices as we will
become uncompetitive.”..Commenting on the near term prospects of
the garment industry, Vaid said, “Garment exporters are still facing
financial difficulties because of worst-ever worldwide recession and
low unit value realization from the overseas market and it would take
some more time for the world economy and the apparel trade to revive” ..He
further pointed out that the labour-intensive garment export sector
requires special consideration as it adds maximum value to the exported
products using over 95 percent indigenous materials ..Sources also
said that with the increase in prices by many apparel manufacturers
currently, the retailers are planning to pass the costs to the
consumers ..In the last couple of months, fabric prices have
increased by 5-10 percent. Cotton prices have increased 30 percent in
the last six months to Rs 27,500 a candy (one candy is 355 kg) and the
movement of yarn prices show that the price of 40s count yarn has
increased from Rs 139 per kg in August to Rs 170 per kg at present ..While
prices of cotton are picking up, 40 lakh bales out of the estimated
export volume of 55 lakh bales have already been shipped during the
first five months of this season ..Cotton production in the
country is expected to increase this season (October 2009-September
2010) to 295 lakh bales (one bale equals 170 kg), from 290 lakh bales
last season ..Meanwhile, the Apparel Exports Promotion Council
(AEPC) on Tuesday also urged the textile ministry to have contract
reservation for cotton and yarn exports to minimise the impact of
rising fabric prices on the domestic apparel industry .
Date:3/25/2010
Source: