The ever-increasing price of yarn, which has risen by 43% per kg in only eight months, and the rising cost of raw materials like zippers threaten to destabilise Tiruppur’s multi-billion dollar knitwear sector.
In the last eight months, the price of yarn alone has risen by more than 40%. The price of lycra, an elastic polyurethane fabric used in a variety of garments, has risen by about 100%. This comes as the country’s knitwear cluster resumes production in small increments following the partial lifting of the lockdown.
Tiruppur accounts for more than 46% of India’s knitwear exports. The cluster’s total exports in the fiscal year 2020-2021 were Rs 24,730 crore. Cotton’s high price increase can be ascribed to the spiralling cost of yarn. Another cause for the price increase is the inconsistent supply of raw materials from China as a result of Covid-19 limitations.
The sector has taken a series of blows, including demonetisation, the implementation of the GST regime, and the global recession. The multi-billion-dollar business was able to compensate for much of the damage done during the first wave. It was feasible since the entire globe was in lockdown, and foreign purchasers tolerated the delay in order delivery.