Tirupur knitwear industry calls for a strike on Mon over rising yarn prices

The Rs 50,000-crore knitwear industry in Tamil Nadu's Tiruppur is set to go on a one-day strike on Monday to protest the spike in yarn prices.

Commonly used combed cotton variants such as 30s and 40s—which indicate the thickness and fineness of the yarn—have seen their prices surge by 24 per cent from Rs 215 to Rs 268 a kilogram.

As many as 27 knitwear stakeholders' associations and eight trade unions held a meeting to discuss the impact of the sudden and unusual spike in yarn prices and also an irregular supply of yarn in the past three months.

About 9,000 worker units, catering to both domestic and export markets, will join the strike. These units employ around 800,000 workers directly or indirectly.

The turmoil in garment manufacturing—the linchpin of Tirupur's economy—has had a cascading effect on the entire value chain in the region, said Raja Shanmugham, president of Tirupur Exporters Association.

Cotton price is a key reason cited by mills for spike in yarn prices. Cotton price has jumped by 19% from Rs.37,200 per candy on October 1 to Rs.44,300 per candy on 1st March 2021. One candy is equal to 356 kilograms.

To control the rising yarn prices and bring it to the attention of the Centre and state governments, associations and trade unions are set to close all shops on Monday, Shanmugham said.

"We have been facing this price hike issue since last year which resulted in an increase in our product prices ranging from 1-1.5% to 4%," said Vinod Kumar Gupta, managing director of apparel firm Dollar Industries Limited.

Representatives of the industry have written to Union Finance Minister Nirmala Sitaraman and Union Textile Minister Smriti Irani to look into the spike in yarn prices which is hurting small and medium-sized businesses.

Many players in the sector are facing issues due to raw material shortage and might be forced to halt their operations if this continues, Gupta said.

The knitwear industry went also on a strike in 2010 when yarn prices shot up suddenly.