Knitwear units sore over decision on cotton expo

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TIRUPUR: The knitwear industry is disappointed over the Union government's decision to allow additional 10 lakh bales of cotton fo..

TIRUPUR: The knitwear industry is disappointed over the Union government's decision to allow additional 10 lakh bales of cotton for export from June 9. Garment manufacturers fear the move would lead to rise in yarn price.
"The garment production from the knit city has decreased during the last one year due to cotton scarcity, power cut, closing of dyeing units and levy of 10 per cent excise duty. Following low demand, the yarn price has come down," said South India Hosiery Manufacturers' Association (SIHMA) president A C Eswaran. He said permission for export of 10 lakh bales of cotton would pave way for yarn price hike in domestic market again. The Union government has already permitted export of 55 lakh bales in the year 201011. He requested the Union government to assess the domestic requirement of cotton for the season and allow the export of excess quantity, thus keeping the yarn price stable.

The yarn price had started to come down from May 2, after remaining high for the last two years. The price for all varieties of yarn went down by `7 per kg on May 2, `15 per kg on May 16 and by `25 per kg on June 1. The current prices of yarn are `259.60 for 20s, `267.60 for 24s, `279.60 for 30s, `286.60 for 34s and `293 for 40s.

However, Tirupur Exporters And Manufacturers Association (TEAMA) president M P Muthu Rathinam said there would be no serious impact due to additional export of cotton as the garment exporters almost stopped accepting new orders following the closure of dyeing sector. "Reopening of dyeing units soon is not certain yet. So, the cotton export will not bring any immediate impact," he added.