Latest News | Spinning Mills to Stop Production, Cotton Procurement: SISPA

Coimbatore, May 21 (PTI) To tide over the crisis of rising cotton prices, small spinning mills on Saturday decided to stop production operations till the situation turns conducive for them and also to stop procurement of cotton.

Also Read | Fuel Price Cut: Petrol To Get Cheaper by Rs 9.5 per Litre, Diesel by Rs 7 per Litre After Govt Cuts Excise Duty.

The decision in this regard was taken at an emergency meeting of members of South India Spinners Association (SISPA) to discuss the present crisis and took a unanimous decision, its president J Selvan said here.

Also Read | Maharashtra: ‘Just Building Ashram Schools Will Not Be Sufficient, What Is Needed Is Quality Education’, Says Ajit Pawar.

Spinning mills are facing an unprecedented hike in cotton prices in the last five months in India as January saw cotton price per candy (356 kg) at around Rs 75,000 that has today gone up to Rs 1.15 lakh, which is an increase of 53 per cent, he pointed out.

At the same time, the yarn price in January was Rs 328 per kg and today (May 21) it is Rs 399 per kg, Selvan noted.

Based on the current yarn prices, mills are incurring a loss of Rs 50 to Rs 60 per kg, he said and attributed the main reason for the sudden rise in rates to low cotton production this year.

Stating that there was no accurate data to measure the country's cotton yield production from the government or the private sector, he said at the beginning of the cotton season, the large cotton traders and multinational companies purchased huge quantity of cotton and stockpiled it.

Even as some quantity has been exported, the steep increase in cotton prices has meant our members are not able to purchase the cotton due to shortage of working capital with working capital getting eroded every day, Selvan said.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)