The Hindu Business Line : Export market sluggish as yarn demand slides

TEXTILE producers have been staring at a sluggish market for nearly a month now as lack of demand for both yarn and grey fabric has dampened their marketing. The slide in demand for coarser count yarn of 30s/40s is well pronounced now, said market sources.

While the export market (especially the Hong Kong and Korean and the South East (SE) Asian markets) for Indian yarn, has practically come to a standstill, local weaving centres consuming yarn for conversion into fabrics too have remained silent for long. The sluggish demand for the grey fabric produced in the South Indian weaving centres has in turn affected yarn off-take.

Yarn traders here, who do not want to be quoted, said the two primary SE Asian markets remained bereft of Indian yarn and the market for the 30s and 40s count yarn varieties, which used to be sold in high quantities earlier in the overseas markets, had come down significantly as there had been no enquiries from importers.

The fall in yarn off-take by the export market has forced yarn producers to offer an informal price discount between Rs 3 to Rs 5 in the local market, mainly for the coarser count yarn of 30s/40s.

Yarn traders expect the fabric off-take and market to pick up by next month. But they also worry that yarn exporters would have to confront with another slow-down in the European markets. They believe the summer holidays between mid-July and mid-August would spoil trade enquiries for their products. Right now, the demand in the EU market is largely for the fine/super-fine yarn counts.

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