Yarn price falls on sluggish demand amid unrest (India)

In the face of sluggish export orders of knit products the price of local yarn fell by 15 per cent over the last two months as international buyers are not feeling comfortable to visit Bangladesh due to political instability, industry people said.

Slow demand due to political turmoil and fall of cotton price on the international market are the two prime reasons for the price fall of yarn, said its manufacturers.

According to the spinners, the price of yarn decreased to $2.80 a kg from $3.25 a kg over the last two months.

Knitwear makers, who are the main users of yarn, however, said that they were not getting any advantage of the decreased yarn price as the export orders declined by 20-25 per cent during the period due to the political turmoil.

‘The price of yarn fell by 12-15 per cent over last two months due to the sluggish demand for the item as export orders have been decreased,’ Bangladesh Textile Mills Association vice-president Abdullah-al Mahmud told New Age on Monday.

Traditionally the price of yarn decreases a bit during the February-April period every year as the price of cotton on the international market fall in the time due to New Year vacation in China that spans for over 30 days, he said.

Besides the international factor, yarn sector is going to sit on a stockpile due to some internal problems, Abdullah said.

Due to the price fall of yarn, its manufacturers are incurring loss as they had to buy cotton at higher prices three to four months back, he said.

Former Bangladesh Knitwear Manufacturers and Exporters Association vice-president Mohammed Hatem said apparel makers were not getting any advantage of price fall in yarn as the texport orders decreased by 30 per cent over the last one and a half months due to political unrest.

‘The buyers are not feeling comfortable to visit Bangladesh and now prefer our competitor countries to Bangladesh in placing orders. So there is no question of getting benefit from the lower price of yarn as we are losing our orders,’ he said.

On the other hand, the major destination of the country’s knit products is Europe but the EU countries are now suffering from economic meltdown, Hatem said.

He said that EU buyers were now bargaining for cutting product prices due to the depreciation of their currency euro.