Woollen items, blanket rates rise 10-20%

Woollen hosiery and blankets are selling at about 10-20 per cent higher in the domestic market compared with last year on account of increase in prices of yarn. However, traders are not being able to cash in on this and do good business this winter.

Less cold this year and competition from leather garments and cheap Chinese woollen products are the major factors affecting the sales of the traders in the woollen products business.

The good news, however, is that exports of woollen garments have risen about 9 per cent in April-July this year.

"Though big retail chains are importing Chinese woollen products through the proper channel, a sizeable quantity continues to flow from illegal channels and is giving domestic manufacturers a tough time in the form of price competition," said Sudhir Bhatia of Universal Knitwear.

The average price of woollen sweater has increased from Rs 500 last year to Rs 700 while that of woollen jacket has gone up from Rs 600 to Rs 800. Shawl price has also risen from Rs 200 to Rs 250, said a Delhi based garments trader.

In Delhi, shopkeepers are hesitant to buy in bulk as the sealing issue is not yet resolved. "Even if it gets colder by the end of December, we won't be able to make profit as most of the shops start selling at discounts from January," he added.

Exports of Indian woollen products in the April-August period rose about 9.3 per cent to Rs 940 crore compared with Rs 860 crore in the corresponding period last year.

Of this, the exports of ready-made garments increased from Rs 702 crore to Rs 775 crore this year, while that of woollen yarn and fabrics rose from Rs 157 crore to Rs 164 crore.

In year 2005-06, the exports of woollen garments stood at Rs 2,098 crore. "We have set a target of exporting to the tune of $500 million this year and are hopeful of realising it," said R K Gupta, executive director of the Wool and Woollens Export Promotion Council (WWEPC).

The main markets for the country's woollen products are countries such as the US, France, Germany, Italy, the UAE and the UK.

To promote Indian woollen products in the CIS that experiences cold weather for most of the year, the WWEPC would open an office in Moscow by March 2007, said Gupta.

The council is also sending delegations to countries such as Argentina and Brazil to ensure a greater market for Indian products.