Despite the apparel manufacturers pleading, local textile millers have kept yarn prices unaffected since August 10.
While Mohammad Ali Khokon, president of Bangladesh Textile Mills Association (BTMA) recently said that there is no room for a price drop as globally the cotton prices are high.
Cotton prices have been unstable since December last year in the international market. Prices grew by 47 percent, demand for cotton yarn by 22 percent and cotton yarn prices by 37 percent, said Khokon.
BTMA President said at a press meet at a hotel in Dhaka.
Khokon stressed that all these occurred due to an increase in demand for cotton-made knitwear. As the COVID-19 pandemic persisting globally and people are staying home for long periods.
Khokon added that since August 10, millers have been selling the commonly consumed 30-carded yarn in the range of $4.20 to $4.30 per kg. While it was sold at $4 per kg in March, $4.20 per kg in April and $4.15 per kg in June.
Furthermore, yarn prices have been growing since September last year with the slow reopening of the global apparel supply chain. So the price increasing trend did not happen suddenly, he said.
In addition, cotton production in the US and India – two main sources of cotton for Bangladesh – have been lower this year because of excessive rainfall.
He also added that, BTMA sent letters to spinners urging not to rise yarn prices anymore as the local customers of yarn such as knitters, weavers and terry towel makers have been expressing their displeasure.
He said generally, manmade fiber is more demanding than cotton fibers in international markets. But currently, demand for cotton fibers has increased among the end-users.
“People prefer knit items like t-shirts and home textiles more than woven items. The demand for woven items, meaning attires that do not change form with body movements, is not increasing that much as formal events have become rare since the pandemic surfaced,” said Khokon.
Yarn import through land ports
About the import of yarn through different land ports were open for the shipments, particularly from India, Khokon said.
While Khokon pointed out that only Benapole land ports has adequate infrastructures to handle the import of yarn.
He said, “If the partial shipment of yarn is allowed, there is a chance of misuse of bond facility and excessive import by a section of traders, which would destroy the local industry while the government would lose a big amount of revenue.”
Earlier, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and Bangladesh Terry Towel and Linen Manufacturers and Exporters Association (BTTLMEA) leaders sent letters requesting the government to permit import of yarn, including partial shipments, through the Sonamasjid and Bhomra land ports.
BGMEA, Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and BTTLMEA have been petitioning with the government for consent mainly to bring about an impact on yarn prices.
But presently partial shipments are allowed only through the Chattogram seaport.
BGMEA President Faruque Hassan said the local knitters, clothing makers and terry towel exporters were the key customers of yarn.
“We have a lot of work orders from our international retailers and brands and now we need yarn at competitive prices to retain our business relations with our buyers,” said Faruque Hassan.
“If we cannot serve our retailers and brands, we may lose our buyers,” he added.
“We also want the local yarn as we have some advantage on use of it. But the price is too high for us. We cannot afford the price level. The government should also think about us,” Hassan added.