War impact: production costs spiral for textile units in Tamil Nadu
The textile industry in Tamil Nadu is facing significant challenges due to the ongoing US-Israel-Iran war, which has disrupted both demand and raw material availability. The price of polyester, a key material for spinning mills, has risen sharply, while the processing sector has seen a doubling of LPG prices and a 30% to 40% increase in dye and chemical costs. These factors have led to reduced operational capacity in mills and a labor shortage, threatening the growth of the region's textile and garment industry.
- ▪The price of polyester fibre is on the rise due to disruptions in oil production and transport from West Asia.
- ▪LPG prices have doubled recently, impacting the textile processing sector.
- ▪Production costs in the garment industry have increased by 10% to 21% since March.
- ▪Many dyeing units have suspended operations due to high costs, affecting overall production capacity.
- ▪The industry is facing a severe labor shortage as workers are unwilling to come to Tiruppur due to LPG shortages.
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COIMBATOREFor the textile industry in Tamil Nadu, the US-Israel-Iran war has affected both demand and the availability of raw materials.For the spinning mills that use manmade fibre, the main raw material is polyester. With oil production and transport from the west Asian countries affected, price of polyester fibre is on the rise.Of the 24 million spindles in Tamil Nadu, only about 21 million are in operation and the textile mills are currently using just 80 % of the capacity. Many of the mills switched over to manmade fibre in the recent year due to high cotton prices. War impact: MSMEs in Coimbatore face rise in input costsIn the case of the textile processing sector, LPG is used for drying the fabric and its prices have doubled in the last couple of months.
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