The problem is impacting the competitiveness of Bangladesh’s RMG industry
Apparel exporters have expressed their concerns over the rise in yarn prices in the local market.
They said retail sales grew sharply in Europe and the US as stores are opening following mass vaccination in the western countries.
As a result a lot of work orders are coming to Bangladesh but an unusual increase in yarn prices in the domestic market has made it difficult for the garment manufacturers to take the increased orders, they said.
Leaders of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Terry Towel & Linen Manufacturers & Exporters Association (BTTLMEA) expressed their worries during a meeting held at BGMEA office on Sunday.
BGMEA President Faruque Hassan chaired the meeting which was attended by BGMEA Vice President Shahidullah Azim, Vice President (Finance) Khandoker Rafiqul Islam, Directors Asif Ashraf, Md. Mohiuddin Rubel, Abdullah Hil Rakib, Rajiv Chowdhury, former Director Ashikur Rahman Tuhin, First Vice President of BKMEA Mohammad Hatem, Director Fazlee Shamim Ehsan, and BTTLMEA Chairman M Shahadat Hossain.
They said the local mills are increasing yarn prices every day and providing proforma invoice (PI) with a short time limit which makes it difficult to open LC in such a short time.
Moreover, it takes around 15 days to confirm orders. As a result, apparel manufacturers could not take many of the offered orders despite having capacity.
Even many factories are taking work orders under breakeven point only to stay in business. Buyers do not increase apparel prices as they only look at FOB.
The problem is impacting the competitiveness of Bangladesh’s RMG industry.
In the meeting the leaders had discussion on ways of addressing the problems being faced by the apparel sector.
It was decided in the meeting that a press conference will be organised soon to share how the yarn price increase is impacting the apparel sector.
They have also decided to hold talks with the government policy makers to ensure yarns at reasonable prices.