| Date: |
04-12-2014 |
| Subject: |
Hope of cut in yarn price rises as crude costs dip |
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SURAT: Power loom weavers are upbeat as global crude prices have slumped to a five-year low of under $64 a barrel, raising high expectations from front line spinners like Reliance Industries to reduce the prices of polyester yarn - main raw material in the man-made fabric sector.
Industry experts said prices of saris, dress materials and fabrics manufactured in the city may come down by 25 per cent, provided the polyester yarn prices are reduced in line with crude prices.
Surat is country's biggest man-made fabric hub, according to first ever 'Baseline Survey of Power loom sector' conducted by AC Neilsen ORG MARG for ministry of textiles, Government of India.Of the 4,88,649 power looms in Gujarat, the city has the maximum which number around 4,70,496. There are only 14,364 shuttle less power looms in Surat. The annual polyester yarn consumption by power loom units in Surat is pegged at 40,610 lakh kilogram and the annual fabric production at 91,871 lakh metre. The total fabric production in Gujarat is 97,206 lakh metre.
Despite continuous fall in international crude oil prices in the last couple of months, the polyester yarn prices have remained unaffected. At present, polyester filament yarn manufactured by front line spinners is traded at Rs 130 per kilogram - the same quality was available for Rs 80 per kilogram three years ago.
Sources said the prices of the crude oil derivatives like naptha are still holding firm. Naphtha is the petrochemical from which monoethylene glycol (MEG) and purified terephthalic acid (PTA) - both raw materials for producing polyester yarn - are produced. Once naptha prices are lowered, the yarn prices will come down automatically.
Sanjay Sarawagi of Laxmipati Saris told TOI, "Weavers are looking towards front line yarn manufacturers to pass on the price benefits. There is going to be a straight effect on the prices of saris and dress materials manufactured in the city. Since chemicals and dyes are by-products of naphtha and crude oil, the fall in prices will benefit the MMF sector on a very large scale. The anti-dumping duty removal would further bring down the yarn prices in the country."
Source : timesofindia.indiatimes.com
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