““Abnormal price hike of cotton, the basic raw material of apparel sector
will also reduce our profit margin significantly,” said Abdus Salam
Murshedy, president of Bangladesh Garment Manufacturers and Exporters
Association. . .
The price of cotton jumped to $2.46 a pound on Thursday in the international market, almost 150 percent up from a year ago. . .
“It will prompt sharp rise of cost for both denims and other textile
products,” Murshedy told a news conference. Many local spinning mills
are facing a severe working capital crunch due to the record surge in
prices of raw cotton, which had rarely traded higher than $1.0 a pound
over the past three decades, the official said.
. .
Since January cotton prices have risen more than 40 percent because of
soaring demand from China, poor cotton harvest in Pakistan and export
restriction in India, leading to acute supply shortages. The textile
exporters said they incurred losses up to 20 percent for the orders
taken in January or earlier. The profit margins of sweaters and denims
are shrinking fast following price hike of yarns and also wage increases
for workers. ”
Date:3/27/2011
Source:Daily Times