Textile minister tells spinners to reduce yarn prices in 24 hours

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FE Report
Textile minister Abdul Latif Siddique Sunday threatened to open up Benapole landport for import of cheap Indian yarn, if the country's spinners failed to cool down prices of the key apparel raw material within the next 24 hours.
The minister said the prices of yarn in the local market are "abnormally high" as the spinners have allegedly cashed on a decade-old protection granted by the government and a volatile market of cotton across the globe.
"I think the market is abnormal and the spinners are charging unfair prices," Siqddique told journalists after a meeting with textile millers, spinners, power loom owners and garment manufacturers at his ministry.
"I've given textile millers time until tomorrow (Monday) to come up with a fair price that can stabilise yarn prices. Otherwise, if necessary, we'll open up Benapole land port for unrestricted import of yarn," he said.
His warnings came amid accusations by the apparel manufacturers and power loom owners that the country's spinning mills have formed a cartel and are charging excessive prices for their yarn.
"We will not open up Benapole Landport for yarn imports if the situation does not demand," the minister said, adding the textile millers have been told to fix prices of yarn in accordance with the international price of cotton.
Yarn import through Benapole port - the country's biggest land customs station - has been restricted since late 1990s in an effort to safeguard the local spinners from an uneven competition from their Indian counterparts.
Local spinners have said that they can never compete with Indian yarn makers as the country is one of the largest producers of cotton. Bangladeshi spinners import cotton from abroad to make yarn, resulting in higher prices.
Mr. Siddique said the high prices of yarn would eventually affect the textile millers as they would struggle to find buyers. "High yarn prices don't help anyone," he said.
Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) president Fazlul Hoque said knitters who now make up more than 40 per cent of the country's exports have suffered worst due to the high prices of domestic yarn
"The country's yarn prices are unreasonably high. The market is unregulated. As a result, the spinners are hiking yarn prices everyday," he said, demanding urgent government action.
"We want fair prices and a win-win situation for both buyers and sellers."
He said the gap between prices demanded by apparel makers, knitters and power loom owners and that of the local spinners "is as high as 80 cents".
"It is a huge amount. And we are paying the prices," said the BKMEA president.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Abdus Salam Murshedy said the country's readymade garment makers would lose competitiveness in the international market if the prices of yarn continue to increase.
The meeting also discussed about opening up Benapole Landport unconditionally, said a source, who was present in the meeting.
The top representatives from BGMEA, BKMEA, Bangladesh Specialised Textile Mills and Power Loom Industries Association (BSTMPIA) and Bangladesh Textile Mills Association (BTMA) would sit today (Monday) with the textile minister again at his office to "fix a fair price of domestic yarn".
BTMA acting president Syed Monjurul Haque and BSTMPIA member secretary Shiekh Abdul Hakim were present during the meeting.