Synthetic yarn spinning mills in Tamil Nadu have decided to cut production voluntarily two days a week with immediate effect.

Piling stock, poor offtake coupled with rising import of synthetic yarn from competing countries, lack of level playing field and a huge drain on the working capital resources of these mills is said to have pushed them to take this decision.

It seemed a knee-jerk reaction, but industry sources say “it is inevitable at this juncture”. As many as 89 managing directors of the various synthetic mills from across the state met to take stock of the situation today.

Naresh Devaraj, Co-ordinator, Indian Texpreneurs Federation (Synthetic Spinners Group) said that out of the two crore spindles in the State, the share of synthetics was around 40 lakh and the monthly production was 40,000 tonnes.

“The last 5-6 months have been pretty bad. The offtake of yarn has been almost nil, resulting in a huge slump in profitability. Mills have started to incur a loss of ₹15-20 on every kg compared to ₹3-4/kg few months back,” Devaraj explained.

Polyester cotton yarn 54s count, which was quoting ₹190/kg in January-February, has slipped to ₹158/kg now and the 64s polyester cotton yarn, which was quoting ₹240/kg six months back has fallen to ₹190/kg.

He said “we plan to meet every fortnight to chalk out future course of action, as the production halt can only be a temporary stance and help reduce piling stock.”

Synthetic yarn import details show that the volumes had risen from 4,484 tonnes in February to 6,601 tonnes in April, while the viscose yarn import increased marginally from 1,054 tonnes in February to 1,157 tonnes in April.

A 10-member team will be visiting markets in Bhiwandi, Bilwara, Ichalkaranji next week to study the situation from the mills located here. Industry

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