On 21 August, readymade garment (RMG) manufacturers and textile spinners fixed the price of the widely used 30-carded yarn at a maximum of $4.20 per kilogram.
This will settle the recent displeasure and uncertainty among the knitters and terry towel exporters and ensure a smooth supply of cotton yarn.
Spinners also guaranteed the RMG and terry towel exporters of safeguarding a constant supply as work order volume has increased from international retailers and brands.
Faruque Hassan, President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) said, “We arrived at a consensus on the yarn price in consultation with the spinners on Saturday night.”
Mohammad Ali Khokon, President of the Bangladesh Textile Mills Association (BTMA) said, “We agreed to set the ceiling of yarn as garment and terry towel manufacturers were demanding lowering of the prices of yarn.”
As per the resolution, textile spinners will get $4.20 per kg for the 30-carded yarn if the cotton price ranges between $85 cents and $1 per pound in the global markets.
Cotton price was $93 cents per pound when the price was set.
Apparel leaders opined that if the cotton price goes past $1 per pound, we will sit again to fix the new price limit.
Likewise, if the cotton price goes below $85 cents per pound, spinners will also lower the price of yarn accordingly.
The price of the 30-carded yarn has been fixed as a benchmark as it accounts for more than 85 percent of the total consumption of raw material in Bangladesh.
Khokon assured that the spinners will be able to supply the yarn at the fixed prices.
After the BTMA requested them – on August 10 – not to raise the price, the spinners have not increased the prices.
RMG manufacturers’ craved yarn from the domestic markets as local obtaining gave some advantages. Bangladesh imports 30% of yarn from countries such as India, Pakistan, Indonesia, and Turkey as local spinners do not produce specialized varieties of the raw material.