The local high cotton yarn prices are said to have left the Pakistani home-textile exporters perturbed at the recent international Heimtextile show in Germany to seal the business deals with global buyers. The show held in Frankfurt, Germany from January 14-17, which attracted a large number of visitors from around the world for the home-textile products.
"Fears kept many of us [exporters] confused whether we will be able to fulfil these orders on time, as the rising cotton yarn prices always push us towards risky deals," Chairman Towel Manufacturers Association, Feroz Alum Lari who also participated in the show told Business Recorder on Thursday.
He said that the response from the buyers at the annual show was positive, depicting that the world has finally come out from the recession. He said that hike in cotton yarn prices emerged as a drawback to the local home-textile exporting sector.
"In business deals with foreign buyers under such varying circumstances, risk factor has to go up which everyone may not take particularly for half yearly contracts," he added. Lari said that the European, US and Russian visitors took deep interest in Pakistani home-textile including towels products.
The show's another participant, Chairman Pakistan Bed-Wear Exporters Association Shabier Ahmed told Business Recorder that the show was "good" where Pakistani exporters had close business interactions with global visitors. However, he declined that the local exporters had grabbed big foreign orders, saying that the high cotton yarn prices failed many of them to sign contracts, as they were not financial viable.
He said that the Chinese price quotation for home-textile products was lower 20 percent from what the Pakistani exporters were offering to the buyers particularly European and Americans. "They [global buyers] will go to China, definitely, as the Chinese government subsidise all sorts of exports making the products cheaper in price on the global markets," Shabier said.
It is pertinent to mention that the government has already announced the capping of cotton yarn export to maximum 50 million kgs a month to safeguard the local value-added textile sector. The global cotton shortage boomed yarn export from Pakistan, which soared its prices on the local market making the value-added textile sector demand of the government to cap its export for this year in line with its last year's total export.
The government's move later invited criticism and protest from the yarn manufacturers, who contended that under the free market mechanism there should not be any kind of restrictions on the export of commodities. Value-added textile exporters still complain that the raw commodity is available at high prices, which make their output costlier.