Related Keywords: adversely impact demand, adversely impacting yarn demand, domestic cotton prices, export competitiveness of Indian yarn, export prospects, ICRA, likely to get hit, Profitability of spinning companies, second quarter of this FY, Slow growth in domestic consumption, stagnation in exports, surpassing international cotton prices
The profitability of spinning companies in the second quarter of 2016-17 likely to get hit, with domestic cotton prices surpassing international cotton prices, adversely impacting the yarn demand and export prospects for the spinning industry, ratings agency ICRA said.
Domestic prices of ginned cotton have increased significantly—from about Rs 90-92 per kg in April to around Rs 122 per kg now. Slow growth in domestic consumption and stagnation in exports are likely to adversely impact demand and export competitiveness of the Indian yarn, the agency said.
