The Southern India Mills’ Association (SIMA) has appealed to the textile value chain to stand united in the efforts to mitigate the cotton and yarn price crisis.
In a statement, Ravi Sam, Chairman, SIMA, has appealed to all the stakeholders in the value chain to adopt win-win strategy to mitigate the grave crisis rather than demanding from the Government to take certain short cited policy decisions like banning or imposing quantitative restrictions on cotton and yarn exports that would tarnish the image of the nation as a reliable supplier in the global market.
The spot cotton prices of Gujarat Sankar-6 bench marked variety that prevailed at Rs. 76,600 per candy of 355 kg during the beginning of March 2022 are now ruling at Rs. 99,000.
The cotton yarn price (40s Red label combed compact hosiery yarn – referred by the downstream sectors as the premium quality yarn sold in Tirupur market) ruled at Rs. 411 per kg and is now ruling at Rs. 481 per kg.
The spinning mills normally use 60 per cent of Shankar-6 variety cotton and 40 per cent of Telangana Bunny Brahma cotton to achieve high yarn realisation of 72 per cent.
However, it is expected that cotton price might start getting softened once the imported cotton as well as the summer cotton from states like Tamil Nadu arrive at the mills.
Ravi Sam said that the Indian spinners have contracted over 10 lakh bales after 14 April 2022 as against 5 to 6 lakh bales contracted till 13 April 2022 from the beginning of the season that might reach the mills only by the end of June.
He cautioned that any negative step or short-sighted policy would cause irreparable damage to the highly capital intensive spinning sector that is already saddled with 35 per cent of spinning machines that are more than 15 years old, which might force the downstream sectors to become import dependent.
Source : https://in.apparelresources.com/