Manufacturers brave slump, export position remains static
Friday, 25 December 2009
Sheikh Shahariar Zaman
The overall export scenario of the country, along with the related production mechanism, has remained static during the current year as the manufacturers were able to brave the worst global recession in the last six decades.
The number of twenty-feet equivalent unit (TEU) shipment went up to a paltry 261,806 during January-November in 2009, while it was 261,528 during the same period last year, according to monthly container movement statistics of Chittagong Port Authority (CPA).
Bangladesh has maintained its export status, but sacrificed price to retain its market share, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Salam Murshedy told the FE yesterday.
"Many manufacturers have accepted export orders at a reduced price believing that the situation would improve after one or two seasons," he said.
The BGMEA chief said the utilisation declaration (UD) is better than that of the last year.
"We are getting out of the neg-ative territory to a positive one as export orders are picking up," he added.
He, however, said the price situation has not improved in the recent times as many buyers are reluctant to increase the price.
"We hope we can negotiate price with the buyers from the next season which will begin from April," he said.
Mr Murshedy said cotton price increase in the recent times has pushed the garment manufacturers into big trouble.
"The price for January delivery was fixed four to five months back and if fabric price goes up now, it will hamper the production process," he added.
It will not be possible for the manufacturers to renegotiate the price and they have to buy the fabric at higher prices and incur loss, he explained.
"Big manufacturers can sustain the losses but for the small and medium units, it will be difficult to absorb," the BGMEA president feared.
The government should immediately take action to improve the gas and power situation, he said.
"The problem is more acute than the global recession," he added.
Centre for Policy Dialogue (CPD) executive director Mustafizur Rahman said it is a good sign that production has at least maintained the level of the previous year.
"In the July-November period, export picked up due to Christmas and New Year sales," he said.
US retail sales increased by four per cent in the recent months.
The footwear sector did well and it is expected that frozen food export will increase after the restriction on its export goes, he said.
"Service sector also did well due to good performance of the production sector," he pointed out.
Shipping, freight forwarding, banking, insurance and other related sectors also benefited as production did not decline, he added.
The overall export scenario of the country, along with the related production mechanism, has remained static during the current year as the manufacturers were able to brave the worst global recession in the last six decades.
The number of twenty-feet equivalent unit (TEU) shipment went up to a paltry 261,806 during January-November in 2009, while it was 261,528 during the same period last year, according to monthly container movement statistics of Chittagong Port Authority (CPA).
Bangladesh has maintained its export status, but sacrificed price to retain its market share, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Salam Murshedy told the FE yesterday.
"Many manufacturers have accepted export orders at a reduced price believing that the situation would improve after one or two seasons," he said.
The BGMEA chief said the utilisation declaration (UD) is better than that of the last year.
"We are getting out of the neg-ative territory to a positive one as export orders are picking up," he added.
He, however, said the price situation has not improved in the recent times as many buyers are reluctant to increase the price.
"We hope we can negotiate price with the buyers from the next season which will begin from April," he said.
Mr Murshedy said cotton price increase in the recent times has pushed the garment manufacturers into big trouble.
"The price for January delivery was fixed four to five months back and if fabric price goes up now, it will hamper the production process," he added.
It will not be possible for the manufacturers to renegotiate the price and they have to buy the fabric at higher prices and incur loss, he explained.
"Big manufacturers can sustain the losses but for the small and medium units, it will be difficult to absorb," the BGMEA president feared.
The government should immediately take action to improve the gas and power situation, he said.
"The problem is more acute than the global recession," he added.
Centre for Policy Dialogue (CPD) executive director Mustafizur Rahman said it is a good sign that production has at least maintained the level of the previous year.
"In the July-November period, export picked up due to Christmas and New Year sales," he said.
US retail sales increased by four per cent in the recent months.
The footwear sector did well and it is expected that frozen food export will increase after the restriction on its export goes, he said.
"Service sector also did well due to good performance of the production sector," he pointed out.
Shipping, freight forwarding, banking, insurance and other related sectors also benefited as production did not decline, he added.