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The overall productivity of knitwear, a sub-sector of the apparel industry, has dropped by at least 10 per cent during the last one month due to shortage as well as price of yarn in the local market, reports UNB.
As the industry suffered a setback due to the price-hike of yarn, industry-insiders fear that the productivity of the second-largest foreign currency earner could fall by 25 per cent in the next three months if the situation did not improve.
In this situation, knitwear exporters have once again urged the government to take prompt decision on the reopening of Benapole land-port for importing yarn from India.
Exporters claim that the price of yarn shot up by 45 cents per kg within a spell of 25 days. Currently, knitwear yarn sells in the local market at US$2.65 per kg, up from $2.20 three weeks ago, they added.
Besides, yarn manufacturers were recurrently failing to supply knit fabrics as per requirement of knitwear exporters. They even could not deliver yarn within their committed deadline, posing a serious threat to the knitting industry, the exporters alleged.
As a result, production in the knit sector has gone down sharply in the recent days.
Admitting the downslide in production, Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) president M Fazlul Hoque told the news agency that they could not accept fresh orders from their foreign clients due to the shortage and price-hike of yarn.
"Some exporters have already lost their international buyers as they will not be able to deliver their consignments in time," he said.
The BKMEA president also alleged that BTMA (Bangladesh Textile Mills Association) takes at least four to five weeks after signing agreement to supply the yarns, but it would hardly take four days if the government opened the Benapole land-port for importing yarns from India.
When contacted, BTMA Chairman MA Awal said the prices of yarn did not increase as much as the BKMEA claimed. He pointed out that yarn prices increased on the global market, forcing the Bangladeshi yarn manufacturers to raise their rates as well.
"But yarn is being sold at $2.40 to $2.45 per kg," Awal told the news agency.
He also suggested the knitwear exporters to raise their product prices to offset the impact of yarn-price hike.
About the reopening of Benapole land-port for importing yarn, the BTMA chairman reiterated their stand that this would overwhelmingly increase smuggling as the port lacks infrastructure facilities.
Meanwhile, the knitwear entrepreneurs said uncertainty looms large in achieving the export-earning target given to the knitwear industry for the fiscal year 2005-06.
Foreign exchange earning target through knitwear sector has been raised to $3.60 billion from last fiscal year's income of $2.81 billion.
BKMEA President Fazlul Hoque pointed out that it would never be possible for the knitwear sector to fetch the huge sum of foreign currency if the government did not act immediately to resolve the yarn crisis.
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