The Hindu Business Line : Cotton wastes shortage hurts spinning mills in TN

Added to these pressures is the bait from the international trade that offers higher rate for waste cotton from India, say the people connected with the OE spinning sector.

G. Gurumurthy

Coimbatore, May 8 Open end (OE) spinning mills in Tamil Nadu are in a tight spot as cotton wastes, their principal raw material, go scarcer forcing them to curtail production.

They are, like the ring spinning mills, confronted with spiralling prices in cotton wastes amidst a surge in their exports from India to countries in the Far-East and Europe.

Apart from the rising cost of virgin cotton (from which the wastes are obtained) which, in turn, pushed up the waste cotton prices as well and decline in the spinning wastes availability, the spawning OE rotor capacity has proved a drag on the industry. Added to these pressures is the bait from the international trade that offers higher rate for waste cotton from India, say the people connected with the OE spinning sector.

“The price of comber wastes, for example, which remained in the Rs.35-36 band per kg till December 2007 have shot up by some 42% now to Rs 52. Such high price has rendered spinning OE yarn unremunerative today”, said Mr K.G. Vijayakumar, Managing Director, The Kadri Mills (Cbe) Ltd. A member of the KG group and a well-known player in the OE yarn market with production of 2.25 lakh kg a day, the company, according to him, has brought down the OE yarn production by 60% to tide over costs.

Mr Vijayakumar felt the low availability of cotton wastes is due to restrained consumption of virgin cotton by ring spinning units hit by higher overheads due to increased power and labour costs.

The shortage of waste cotton felt in a small way in 2003 kept rising along side the growth witnessed in the number of OE units since then and, according to Mr J Thulasidaran, Managing Director of The Rajarathina Mills Pvt Ltd, a major OE yarn manufacturing unit in Coimbatore region, the multiplicity in the second-hand OE spinning machines imported between 2004 and 2006 from the erstwhile Soviet bloc countries and East Europe had added keg to waste cotton demand surge. The increased efficiency in minimising short fibres in cotton achieved at the carding and combing stages leading to higher yarn realisation and lower cotton wastage is attributed to low volume cotton waste generation by the ring spinning unit.

OE spinners use cotton wastes from the ring spinning mills coming as the carding wastes (called flat strips) or comber wastes (comber noils) to produce coarser yarns in the counts especially 6s, 14s, 16s that go to make home textiles or apparel fabrics .

Tamil Nadu houses a third of the country’s OE spinning capacity of 5.2 lakh rotors (2005-06) producing about 400 million kg out of 1000 million kg produced in the country. Rajapalayam, Vellakoil and Coimbatore are the centres where OE units are concentrated in the Sate.

While no data are available on the volume of waste cotton consumed by mills or the volume of shipment, the OE spinning industry blames the free export of waste cotton under the open general licence allowed four years ago for the current crisis.

Textile mills especially those in Madhya Pradesh and Maharashtra which used to sell their surplus cotton wastes to the units in Tamil Nadu now prefer to export them as they find the 1.30/1.40 dollar a kg realised on waste cotton export attractive. Another disincentive for the trade in supplying waste cotton to the southern industry, according to Mr Ladha of Bombay Trading Company, Kohlapur, a waste cotton dealer, is the heavy transportation cost. A truck load of waste cotton transported from Kohlapur to a mill in Coimbatore today worked out Rs 17,000 and in case of a mill in Rajapalayam, it is further higher at Rs 21,000, he added.