The Tirupur Exporters’ Association (TEA) has urged the textile mills to not to increase the cotton yarn prices and also not to stop cotton yarn supply. The 20 per kg increase in cotton yarn price in June 2018 has pushed the knitwear garment export sector into a difficult situation, making it difficult to sustain in the competitive global environment.

“The knitwear export sector has been passing through a challenging business environment further to implementation of GST and this could be apparently witnessed from the continuous declining of knitwear exports on a month-on-month basis since October 2017, after three months transition period is over and the declining of exports for the second half yearly period of 2017-18 was 21 per cent,” TEA President Raja M Shanmugham said.

“The most worrying factor is that the negative trend in exports growth is continuing in the current financial year also and the average decline of knitwear exports in the month of April and May was 34 per cent,” he added. The knitwear sector has now started receiving the orders after a prolonged one year lull, and increase in yarn prices at this point of time would derail the industry, Shanmugham said. “The aftermath effect would be severe as not only the knitwear garment sector will get affected but also there will be a boomerang effect on the textile mills.”

Shanmugham has already met Union Minister of Textiles Smriti Irani and requested to mandate the Cotton Corporation of India (CCI) to ensure availability of sufficient quantity with desired quality cotton to protect the interest of farmers, textile industry and also employment.

The increase in cotton prices has made the textile mills to increase the yarn prices which ultimately affect the downstream value added sectors like weaving, knitting, garmenting, made-ups etc., particularly value added exporters as they could not revise the price upwards immediately as the prices were fixed more than three to five months ago.

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