The Hindu Business Line : Handloom exporters fare poorly in German fair

INDIAN handloom goods and made-ups exports have lost out in price quotes at the recently concluded Heimtextil Fair, the prestigious German home textile fair, which heralds the global textile fairs calendar itinerary.

Made-up exporters from other contending countries, China, Pakistan, Turkey and to some extent Indonesia, managed to walk off with good orders by quoting a price lower by at least 20 per cent over those quoted by Indian exporters, according to members of Karur based home textile export industry and Karur Textile Manufacturers Exporters Association.

"Perhaps for the first time in recent years, the Indian home textile exporters have witnessed setback in their order booking at the German fair as they could get only 40 per cent of the usual orders this time around. The cause for slip in the orders is on account of volatile price of hank yarns, the principal raw material for handloom and home textiles which made our end products costlier compared to our competitors," said Mr S. Susindran, Secretary of the Association told Business Line.

According to Mr Susindran, the price of hank yarns, particularly in 2/17s remained highly volatile between November last and first week of this year and rose as high as 35 per cent in two months and this has caused an unsettling effect on our prices to be quoted to the overseas buyers.

He said the particular yarn ruling at around Rs 390-400 per bag of five kgs soared to Rs 510 and beyond by first week of this month preventing the shippers from finalising their export prices.

Most shippers finalise the home textile supplies at the Heimtextil fair, which caters to the buyers across EU, US and Far East as well and cover the demands for the next three seasons. This time there were as many as 40 handloom and home textile shippers from Karur set up stalls at Heimtextil fair and another 100 exporters from the area had a one-to-one meetings with the buyers at the fair.

Karur home textile products are predominantly made out of the hanks in the counts of 10s, 2/10s and 2/20s and these yarns have witnessed violent price fluctuations and the Karur exporters feel the volatility has been partly due to market manipulation as may "were aware that Indian home textile and handloom exporters were to participate in a big way in the Heimtextil fair this time".

Mr D. Senthil Kumar, Managing Partner of A.D. Textiles, Karur, which exports home textiles to EU, feels that there is no rationale behind the uncontrolled surge in the hank yarn prices seen during those two crucial months. Though the spinners laid the blame for the higher yarn price on raw cotton, the percentage of increase in the price of cotton and that of yarn remained incomparable.

The raw cotton prices moved up only by Rs 2,000 to Rs 3,000 per candy which could justify a hike of only Rs 3 per kg or Rs 25 per bag of yarn, whereas the yarn price was raised sharply by Rs 100 per five kg bag within two months.

"This has led to instability in the home textile export trade today which is unable to work out its costs and if the problem persisted, it may seriously affect the business fortune for Indian home textiles," he added. Mr Susindran said his association had convened a meeting of all members of the textile trade including the yarn dealers in the region so as to request them to take steps to stabilise the raw material price to protect the interests of every one in the trade. The prices after the meeting showed did marginally fall only to rise again now.