Staff Reporter :
The apparel exporters have expressed concerns over the soaring yarn prices in the domestic market, although the export orders are pouring into the country amid the ongoing pandemic.
Lots of work orders are coming to the country as the retail sales grew sharply in the Europe and the US for reopening their shops following mass vaccination in the western countries, they said.
But the unusual increase in yarn prices in the domestic market has made it difficult for the garment manufacturers to take the growing orders, they added.
“Yarn manufacturers are asking $0.90 to $1 higher price for a kilogram of yarn than the international market rate,” said Mohammad Hatem, Senior Vice President of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).
The apparel makers use three types of yarn – card, combian and organic – to make garments for export. Of which, card yarn is the cheapest one and being sold at $4.20 per kg, $1.5 higher than six months ago, he added.
The RMG makers alleged that the local millers are increasing yarn prices every day and providing Proforma Invoice (PI) with a short time limit which makes it difficult to open letter of credit (LC) in such a short time. Moreover, it takes around 15 days to confirm orders. As a result, the apparel makers could not take many of the offered orders despite having capacity, they added.
Even many factories are taking work orders under breakeven point only to stay in business, they said.
Buyers do not increase apparel prices as they only look at FOB. The problem is impacting the competitiveness of the country’s RMG industry.
Resolving the crisis, the leaders of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and Bangladesh Knitwear Manufacturers and Exporters Association (BKM EA) held a meeting with the textile millers at the BGMEA office on Sunday.
BGMEA President Faruque Hassan chaired the meeting which was attended by BGMEA Vice President Shahidullah Azim, Vice President (Finance) Khandoker Rafiqul Islam, Directors Asif Ashraf, Md Mohiuddin Rubel, Abdullah Hil Rakib, Rajiv Chowdhury, former director Ashikur Rahman Tuhin, Senior Vice President of BKMEA Mohammad Hatem, Vice President Fazlee Shamim Ehsan, and BTTLMEA Chairman M Shahadat Hossain.
In the meeting, the leaders discussed the ways of addressing the problem being faced by the apparel sector.
It was decided in the meeting that a press conference will be organised soon to share how the increased yarn price is impacting the apparel sector.
They have also decided to hold talks with the government policy makers to ensure yarns at reasonable prices.
