Tirupur Apparel Sector Opposes Yarn Price Hike – Responds With a Day-Long Strike led by the Federation of Tirupur Apparel Cluster
30 November 2021: Conveying its protest against the rise in yarn prices, the entire Tirupur garment sector led by the Federation of Tirupur Apparel Cluster went on a day-long massive strike with the closure of all businesses and hunger strike on November 26, 2021. The protest and hunger strikes were observed by knitwear manufacturers and exporters, and various industry associations such as Tirupur Exporters’ Association (TEA), Tiruppur Export Knit Printers Association (TEKPA), etc.
Speaking to Screen Print India Magazine, T. R. Srikanth, President, TEKPA, said that the strike was a total success and even the labour unions had also joined the strike. A memorandum has been submitted by the industry to the Ministry of Textile, the PM’s office and the Finance Ministry drawing their urgent attention to bring down the yarn prices. The memorandum also sought a ban on cotton exports and to bring restrictions on yarn export.
Srikanth explained that when orders get finalised with the export buyers, the prevailing yarn price is taken into consideration but at that time yarn is not sourced by the industry. So, when the industry plans its sourcing and production and if at that time yarn prices go up (yarn prices went up by 50%), then the industry will face huge losses as the buyers will not consider the increases in prices of finished products due to yarn price increase.
The TEKPA President said that either the Tirupur industry has to bear the losses (about Rs.100 crore per day) or may lose huge orders if prices of finished products are hiked after the original price negotiations and there is every chance that orders may get diverted to other markets such as Sri Lanka, Bangladesh, Vietnam, etc. Thus, the total strike in protest against the yarn price hike was imminent, he said.
He said that as it is, owing to the COVID-19 pandemic the market is yet to bounce back to the pre-pandemic situation. As such, investments in new machinery are slow. Due to the rise in inks and chemicals prices, the market is moving a little slower. The hike in yarn prices was a big blow to the Tirupur garment industry. He said that almost 90% of Tirupur exporters are MSMEs and they are unable to absorb the yarn price rise and the whole value chain gets affected in Tirupur.
