SIMA forecasts recovery of yarn sector; lower cotton prices

The yarn sector, affected by high cotton prices in the past six months, might become normal within a fortnight with demand picking up in major domestic markets owing to coming Diwali festival, textile industry body Southern India Mills' Association (SIMA) said today.

Also forecasting stable and lower cotton prices, it said the country would also have competitive advantage in the international market also.

SIMA Chairman P Nataraj said in a statement here that the demand for yarn in the markets especially Bhiwandi, Ichalkaranji and Kolkata had picked up with the requirement for fabric going up in view of the festival season.

In addition, the unsold yarn stock with the spinning mills was also low now.

The SIMA chief also said the global cotton position would be very comfortable during 2017-18 due to increase in area under cultivation of the crop area by around 11 per cent.

India was likely to get a record crop with 15 per cent increase in area and favourable monsoon and weather, he said.

The cotton price would also be comparatively lower throughout the season and therefore, the domestic demand would pick up, he said.

Indian textiles and clothing industry had been passing through continuous recession during the last three years mainly due to poor off-take in the global market, he noted.

Nataraj attributed the reason to the Free Trade Agreement and Preferential Trade Agreement competitive advantage gained by the competing nations like Vietnam, Bangladesh and high tariff rates imposed on Indian textiles and clothing products in major textile makers such as the European Union, the US, Canada and China.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)