Apparel exporters have voiced their concerns over the increase in yarn prices, especially in the local market.
Retail sales have grown sharply in Europe and the USA as stores are opening following mass vaccination there, and Bangladesh is getting a lot of work orders as a result, RMG leaders said on Sunday.
But the unusual increases in yarn prices in the domestic market has made it difficult for local garment manufacturers to accept increased orders, they added at a meeting held at the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) office in Dhaka.
Present at the meeting, leaders of the BGMEA, Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Terry Towel & Linen Manufacturers & Exporters Association (BTTLMEA) also decided to hold talks with government policymakers, seeking their support on buying yarn at reasonable prices.
Apparel makers said the local mills are increasing yarn prices every day and providing proforma invoices with a short time limit, which makes it difficult for them to open LCs. A Proforma invoice is an estimated invoice sent by a seller to a buyer in advance of a shipment or delivery of goods.
Moreover, it takes around 15 days to confirm orders for yarn from the local market, so many apparel manufactures are unable to take more orders despite having the capacity, RMG leaders said at the meeting.
Even many factories are currently taking work orders under breakeven point just to stay in business, as buyers do not increase apparel prices on par with the increasing yarn costs. This issue is negatively impacting the competitiveness of Bangladesh’s RMG industry.
BGMEA President Faruque Hassan chaired the meeting, which was attended by BGMEA Vice President Shahidullah Azim, Vice President (Finance) Khandoker Rafiqul Islam, Directors Asif Ashraf, Md Mohiuddin Rubel, Abdullah Hil Rakib, Rajiv Chowdhury, former Director Ashikur Rahman Tuhin, First Vice President of BKMEA Mohammad Hatem, Director Fazlee Shamim Ehsan, and BTTLMEA Chairman M Shahadat Hossain.
