High cost cotton yarn affect Karur home textile units | Trichy News

Trichy: The more than 60% increase in cotton yarn price for the last two months has affected home textile exporters in Karur district. With an annual turnover of Rs Rs 5,000 crore, these textile units have asked the government to regulate yarn export and relax import duty on cotton to stabilise the cost of yarn.
While 50% of the yarn produced in the country is from Tamil Nadu, home textile units procure it from mills in Coimbatore and Dindigul districts. Though the lockdown enforced in March 2020 had adversely affected the home textile business, things started looking up five months later in August.
“It was the same time when the requirement for cotton yarn too increased, which subsequently encouraged its export,” said Atlas M Nachimuthu, president, Karur Textile Exporters Association. The cost of yarn gradually started increasing from November 2020. “Since we had already accepted orders on a price for home textile export material, we could not increase the price. This has been affecting our profit margin,” he said. We urge the government to relax the import duty on cotton and check on export of yarn to stabilise its price, said Nachimuthu.
On the other hand, small and medium units blame it on the large units for hoarding cotton yarn and selling it in the black market, adding to the cost. Executive committee member of Karur Textile Exporters Association R Stiffen Babu said prices are also increasing because of the unethical practices of big home textile units. Major exporters are blocking yarn supply by making bulk bookings and preventing small players from getting it, he said.
S Jagadesh Chandran, vice-president of South India Spinners Association, put the onus of the increased cost of yarn on Cotton Corporation of India (CCI). The cost of a kilogram of cotton now is fixed at Rs Rs 140 by CCI, which is Rs Rs 20 higher than the cost before the Covid-19 outbreak. Unless the central government brings down the cost of raw cotton, the cost of yarn is unlikely to come down, he said.