Archive for the ‘News & Updates’ Category

Commerce ministry says cotton export ban done in haste and panic

Posted on the May 1st, 2010 under News & Updates by admin

KARTIKAY MEHROTRA
Posted: Saturday , May 01, 2010 at 0203 hrs New Delhi

The commerce ministry has expressed its displeasure over the textile ministry’s ban on raw cotton exports, describing the action as being done “in haste and panic.” As a result of the ban, cotton prices in Gujarat have fallen by nearly Rs 2,000 per candy.

Spurred by the inflating cost of the commodity, up by 20 to 25 per cent worldwide, the textiles ministry banned the textiles commissioner from approving the registration of export contracts last week. Expecting the prohibition to last for five to six months, high ranking sources in the trade ministry said India’s carry over of about 40 lakh barrels (LB) at the end of the cotton-year should have been enough to avoid the ceasing of export contract approval by the textile commissioner. “Instead, the textile’s ministry wants farmers to sell cotton for cheap,” said the source. “If you ban the export, the farmer has no choice — he has to sell it for cheap.”

The country generated 292 LB of cotton in fiscal 2009-2010 over the previous fiscal’s production of 290 LB. The total availability, including carryover, stood at 370.5 LB while demand was limited to 330 LB, equating to a 40.5 LB surplus, according to the Cotton Corporation of India which released its most recent data on April 8.The textiles ministry imposed the ban about two weeks later. “It was done in haste on the part of the textiles ministry,” said the source.

Caused by industry lobbies interested in keeping the cost of cotton down, the commerce ministry said cotton growers in Gujarat and Maharashtra will suffer the most. Because the ministry has made growing cotton unprofitable for farmers and exporters, growers may sew other crops which would be less likely to endure government intervention, said the source. Gujarat generated 98 LB in 2009-10 while Maharshtra produced 61 LB.

Last week, Gujarat chief minister Narendra Modi had written to the Prime Minister’s Office requesting that the ban be lifted. In December, P G Makhija, executive director of Gujarat Ambuja Exports Limited said, Cotton exports must be banned and that Government should prevent hoarding of raw cotton to overcome crisis in the domestic cotton market.

In the meantime, cotton sellers in India will make bundles by purchasing large quantities of the commodity at bottom market prices then selling them close to the inflated cost. “I think it’s important that you maintain a carry over bulk, but I think you are not in that kind of a crisis right now,” said the source. And the truth of the matter is that prices are high right now because total cotton costs are high, worldwide.”

News printed in http://www.indianexpress.com/

Impasse ends: Textile traders, processors reach consensus

Posted on the April 29th, 2010 under News & Updates by admin

TNN, Apr 28, 2010, 10.11pm IST

SURAT: After a month-long impasse, textile processors and traders of the city have reached an agreement over the contentious issue of the processed job charge price rise.

In a combined meeting on Tuesday evening comprising office-bearers of both representative bodies South Gujarat Textile Processors’ Association (SGTPA) and Federation of Surat Textile Traders’ Association (FOSTTA) they have reached a consensus of letting the matter be dealt on a one-to-one trader-processor basis.

After a long parley, they came to the conclusion that increase in job charge by 10 per cent is a matter pertaining to business and so should be dealt after negotiation between a seller (processor) and buyer (trader).

Both sides have decided not to force any of their members to impose any rise. If a trader finds it feasible for his business to buy material from a processor at the increased rate, it will be solely his decision. Neither the FOSTTA nor the SGPTA will interfere.

SGTPA president Pramod Chaudhary told TOI, “We took a collective decision to hike the rates as everyone wanted a raise due to increased cost of production. We have informed this decision to our members. It was a misunderstanding by some traders which created this situation.” He added, “However, as everything is clear now we see no problems.”

A leading trader also expressed satisfaction at the outcome and said, “We want good quality, and so will have to pay. We are prepared for it.”

The meeting was attended by Kunjbihari Sultania, Ravindra Arya, Subhash Patodia, Vinay Agarwal, Anil Rathi, Shreekant Mundada apart from Chaudhary from SGTPA. FOSTTA was represented by Devkishan Manghani, Murari Sureka, Mahendra Oswal, Manoj Agarwal, Subhash Bansal, Subhash Mittal among others.

News taken from here http://timesofindia.indiatimes.com/city/surat/