The Home Textile industry is dealing with important headwinds given the rise in enter value, logistical challenges, inflationary pressures, and an unstable world surroundings, which is placing untoward stress on margin and demand. What is much more worrying is that China and Pakistan are chipping away on the market share of Indian cotton imports within the US, says a current examiner.
A report by OTEXA knowledge found, India’s market share in US cotton sheet imports fell to 50% in 4QFY22 from 60 percent in 4QFY21, whereas China and Pakistan gained about 5 percent market share. In the Terry Towels phase, India’s share has fallen by 300bp to 40 percent in 4QFY22 (v/s 43 percent in 4QFY21), whereas China/Pakistan’s share remained fixed at 20 percent and 23 percent.
Trouble for the industry stems from the truth that uncooked cotton prices in India elevated YoY and are presently at par with worldwide prices. As yarn and material prices are rising in tandem, corporations are dealing with an enormous problem by way of passing on larger prices internationally.
What has exacerbated the matter is that depreciation in the US Dollar (USD): Pakistani Rupee (PKR) helped Pakistan gain market share in the US and Europe as buyers see better pricing for its products. USD: PKR depreciated by 21 percent as against a 6 percent depreciation in the USD: INR from Sep’21 to May’22. However, the expected signing of the FTA with the UK and Europe will bring Indian products on par with that of Pakistan, says the report.
Cotton prices have also seen a pointy spike due to non-availability of cotton. When it comes to outlook, corporations concerned within the sector say though there are important headwinds within the close to time, they continue to be optimistic on demand within the mid to long term, due to growth in export alternatives on account of the Foreign Trade Agreements (FTA) signed by India with nations such as Australia and the UAE. An FTA with the UK is predicted to be finalized quickly. Discussions on an FTA with Europe is about to start by Jun’22. “Such FTAs, along with the government’s steps to support the Indian Textile exports, reflects positively on the long-term outlook for the industry,” says the report.
