Crisis looms: Gujarat’s textile industry slashes production – ET Retail

Consultant Picture

Ahmedabad: The state’s textile trade, which suffered final yr attributable to excessive cotton costs and low demand, is once more witnessing manufacturing cuts. With a discount within the orders being positioned, many textile processing items within the metropolis are operating at 40% capability and have begun observing two-day manufacturing cuts. Equally, weaving items are additionally working at decrease capability.

Whereas spinning mills are operating at round 90% capability, shares are additionally piling up. Specialists consider that quickly, spinning mills too will slash manufacturing for a day each week. Jayesh Patel, vp of Spinners’ Affiliation, Gujarat (SAG) stated, “Presently, most spinning mills are operating at greater than 90% capability.

Nevertheless, the demand shouldn’t be robust, and shares are piling up. We worry that spinning mills must cease manufacturing for a minimum of a day each week. The spinning mills in south India are working at 60% manufacturing capability and people within the north have additionally lower down on manufacturing. At current, combed yarn prices Rs 260 per kg and the costs are usually not aggressive within the exports market; even the home demand is slowing down.”

The influence of decline in retail demand for apparel is felt on your entire worth chain of textile trade.

“With a delayed summer season, the demand for summer season assortment is relatively low. Furthermore, retailers have an enormous chunk of unsold stock from the winter assortment. Resulting from this, the sellers are dealing with cashflow points because of which the quantity of contemporary orders has declined,” stated Rahul Mehta, chief mentor, Clothes Producers’ Affiliation of India (CMAI).

“Total, in each home in addition to export markets, the demand has gone down because of cautious discretionary spending. This might set off a discount in capability utilization in textile in addition to garment making items,” he added. Cotton is priced at round Rs 61,000 per sweet, however owing to poor demand from the clothes sector, the trade is badly hit.

Bharat Chhajer, former chairman of Powerloom Growth and Export Promotion Council (PDEXCIL), stated the trade had been witnessing a gradual revival with cotton costs stabilizing.

Naresh Sharma, former vp of Ahmedabad Textile Processors’ Affiliation (ATPA) stated, “Textile processing items which noticed some surge in demand have once more been struggling for the previous one month. Many items are operating at round 40% capability and most of them observe holidays for 2 or three days per week.”

The orders for gray cloth dyeing and printing are additionally few as a result of the retail demand is weak, he stated.

“Nevertheless, the scenario has modified within the final one month and the processing items do not need sufficient orders and they also have been observing two-day offs per week. The weaving sector can be hit by poor demand. We consider the retail demand is weak and that the conventional operations will resume solely after garmenting actions collect tempo,” he added.

  • Revealed On Might 11, 2023 at 03:48 PM IST

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