Bangladesh ready-made garment (RMG) salesmen may have to re-price their imported fabrics if spiking prices for cotton continue in international markets, spinners said yesterday.
Cotton prices surged to a 15-year high yesterday on increased demand, fuelled by speculation of reduced supplies after crop damage in Pakistan, said A Matin Chowdhury, managing director of Malek Spinning Mills Ltd, a major importer of cotton.
Cotton was selling at $1.1-$1.5 per pound yesterday, up from 95-99 cents a month ago. "Cotton price may reach $1.10 per pound if the present price trend continues," said Chowdhury.
He said many importing countries have stored cotton, speculating that rising demand and crop damage would force prices up.
"We may have to face a new price pressure from the international buyers, because we have already quoted the old rate for garments to our buyers, but we will have to import the fabrics at the increased price," he said.
Buyers of the EU and US are not willing to increase their prices during a recession, he said. Chowdhury also said the price of most yarn will also increase in Bangladesh if the price hike of cotton persists in the international market.
Bangladesh imports nearly 50 lakh bales (440 pounds make a bale) of cotton in a year, he said.
Abdul Hai Sarker, president of Bangladesh Textile Mills Association (BTMA), said Bangladesh imports 10 percent of its total cotton from Pakistan.
"Bangladesh will be a bit affected by crop damage in Pakistan's recent flood," Sarker said.
Source: thedailystar.net
