The TEA President said he had already met Union Textiles Minister Smriti Irani over the issue, with a request to mandate that Cotton Corporation of India ensure availability of enough quantity with desired quality to protect the interests of farmers, the textile industry and also to generate employment.
In the week of 24 July cotton yarn markets saw marginal fluctuation but were mired in sluggish transactions, with downstream placing thinner orders. In China, sales of regular and high-quality yarns were passable, and those of high-count and combed yarns were limited. Spinners were implementing production cutbacks, and liquidity lagged in most deals. 32s cotton yarn in Shengze market were down US cents 4 a kg on the week while 21s were flat at US$3.07-3.14 a kg.
Spun yarn export earnings continued to decline (year-on-year) for the thirteenth consecutive month in May 2015 while volume shipment growth remained on positive territory for some months now. In May 2015, all kinds of spun yarn exports were up 2 per cent in terms of volume but down 11 per cent in terms of value as FOB per unit price fell 12 per cent. Volumes were at 101 million kg worth US$300 million or INR1,890 crore, implying an average unit realisation of US$2.97 per kg. This was down US cents 42 or 12.4 per cent from May 2014.
Garment exporters in Tirupur currently dominated by cotton garments are seeing opportunity in synthetic garments, as labour costs are increasing in China, which dominate the global synthetic garment business.
According to Tirupur Exporters' Association (TEA), garment exporters are in the process of tapping synthetic and blended garment segments in a big way, which constitute about 70 percent of global demand.
Although India saw demand for cotton yarn from China on a declining trend and the European Union market for fabrics and made-ups mired during the last four months. However, the demand for textiles would be picking up soon in India with the festival season just round the corner.
Drop in export demand for cotton yarn and the slowdown in the domestic market are only temporary and yarn manufacturers should not panic because of the “temporary slothfulness in the market, according to chairman of Southern India Mills’ Association (SIMA) T. Rajkumar.
Spun yarn prices continued shed slightly in the week of 16 May in China, although fibre prices remained more or less stable. However, prices in Pakistan were seen rebounding as demand from overseas buyers was apparently recovering.
Cotton prices, which were ruling at 47,500 (spot price per candy of 355kg) during September 2013, came down to 39,000 in December. But they have again increased to 43,000 now, mills said. Prices of 40s combed hosiery yarn for the corresponding months stood at 260 per kg, 241 and 256 respectively.
According to T Rajkumar, chairman, Southern India Mills’ Association, the cotton price rise alone would have an impact of 25 per kg on yarn, which has been only partly passed on to downstream sectors, which is unavoidable to sustain viability.
