Bangladesh garment exporters are feeling the pinch of a sudden rise in yarn prices in the local and international markets. Yarn prices rose 40 per cent between December and June because of the cotton price hike in the international futures markets, exporters say. Cotton prices soared 21 per cent year-on-year to $1.99 per kilogram in the January-March quarter of 2021.
Bangladesh produces 1.5 lakh bales of cotton annually, but the price of raw materials has risen by 25. The increase in yarn price has pushed up the production cost of a finished exportable garment item by 25 per cent. Some retailers and brands are reluctant to offer a better price to local garment suppliers.