Silk price hits $34 a kg as production in China falls

Owing to a decline in production in China, price of raw silk has gone up to $33-34 per kg from $14 in 10 months. The demand for Indian silk is witnessing a surge internationally, which is expected to push up the export of the commodity to Rs 3,500 crore this year from Rs 2,700 crore last year.

T D Koshy, deputy director, Central Silk Board (CSB), told Business Standard, "Domestic price has gone up because of the anti-dumping duty imposed by the government to limit imports. The increased demand is adding to it. Production in China, the biggest producer of silk followed by India, is under pressure because of the bad weather, land shortage and high labour cost."

Price of spun silk has risen to $28 per kg from $10 in 10 months. Noil silk is being quoted at $16 per kg, which was just half earlier.

The silk board is devising schemes to increase the natural silk production to 20,000 mt by 2007. In 2004-05, the figure stood at 16,000 mt.

This agro-based industry is also a good foreign exchange earner for the country. Eying the growing European, US and West Asian demand for silk, Indian silk producers are increasing the output.

"The silk production In India is yet not being able to meet the domestic demand, which is estimated to be 23,000 mt every year. The country imports 7,000-8,000 mt silk from China. China produces 60,000 mt of silk annually and is consistently increasing the output," said Koshy.

The five traditional silk producing states are Karnataka, Tamil Nadu, Andhra Pradesh, West Bengal and Jammu and Kashmir.