The country’s apparel accessories and packaging manufacturers, crucial backward linkage to the apparel industry, have been hit hard due to the fresh rise of soaring prices of raw materials in the international market.

Industry insiders said that the steep rise in prices of yarn, kraft paper, polyester and other accessories in the global market has threatened the local apparel industry, which had been inching its recovery from the immense difficulties caused by the COVID-19 pandemic.

 

They also lamented that while the apparel sector was on the rebound thanks to fresh work orders, the accessories and packaging manufacturers never recovered from the losses stemming since the COVID-19 outbreak in January last year.

 

Industry insiders also said the recent hike of the price of cotton in the international market has also impacted the rise of yarn price in Bangladesh.

 

Bangladesh is the highest importer of cotton among other countries.

 

Accessories and packaging industry owners said that they are incurring losses as they have to import raw materials at a higher price, but are deprived of a fair price from domestic clients.

 

Although the RMG items export has increased, accessories manufacturers have to sell their products in losses as their domestic buyers are not ready to pay higher prices.

 

According to Bangladesh Garment Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA), prices of raw materials have started rising since January of this year. Over the last five months, the prices of necessary raw materials such as polymer, yarn, kraft paper and chemicals ranging between 40 percent to 80 percent.

 

Amongst them, prices of yarn increased to USD 3.5 from USD 2.5 per kg, polymer has shot up to USD 1,600 from USD 960 per ton, and kraft paper jumped to USD 1,400 from USD 880 per ton, said the BGAPMEA.

 

Moreover, the prices of ink have also soared to USD 9-12 from USD 7 per kg where the price of chemicals have increased to USD 90 from USD 55 per kg, BGAPMEA said.

 

Industry insiders also said that as the apparel prices have plunged in the global market, the accessories manufacturers are not getting usual prices for their products.

 

According to BGAPMEA, currently there are about 1,800 factories producing 40 types of garment accessories and packaging items in the country with employment of nearly 700,000 workers.

 

This backward linkage industry meets 95 percent of the demand of the country’s RMG sector, which accounts for 86 percent of the national export earnings.

 

Source: dhakatribune.com