Nowadays raw cotton and cotton yarn prices are continuously rising. In that situation various textile companies in Gujarat, a leading textile-producing state in India, are not utilizing their full capacity, as a result, some units may temporarily shut down.
Along with this, some units are also facing difficulties in booking fresh orders due to the high raw material price. If prices don’t go down, most spinning units will be forced to shut operations.
Saurin Parikh, President, of the Spinners Association of Gujarat and Founder of Pashupati Cotspin, said, “Already many spinning mills are incurring losses to fulfill customer commitments. Nearly 120 spinning mills in Gujarat are running at a little over 50 percent capacity at present.”
Also the weavers as well as international buyers are not willing to pay the higher prices of cotton yarn, most spinning units are unable to increase prices of end products in proportion with raw cotton rates, he added.
Chintan Thaker, President, Welspun Group, said “Our two units in the state are operating at 60 percent capacity. Our international buyers are not willing to absorb increased prices of raw materials.”
Sometimes, they are supplying textile products despite making losses to fulfil prior commitments.
Actually not only spinning mills or large textile group, but also apparel manufacturers are also facing production cuts.
Regarding this, Vijay Purohit, President, Gujarat Garment Manufacturers Association (GGMA) said, “That it is extremely difficult to run apparel manufacturing unit as prices of fabric is high, especially when majority of the apparel manufacturers are MSMEs.