At Rs 1 lakh for a single candy, cotton yarn prices are making a bigger hole in yarn spinner’s pocket than they did 18 months ago. The rise in prices is incapacitating small and medium-scale garment exporters, who now have to pay Rs 30 to Rs 50 more for a kg of yarn, says Krish, Managing Director, Victorian Clothings. Accounting for 45 per cent of a garment’s costs, yarn prices are generally absorbed by buyers during production. However, since prices have more than doubled, spinners have refused to absorb this rise, explains Ramu Raju, Partner, Fashion Knits, a Rs 75-crore manufacturer of jackets for brands like Esprit.
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