Eid boosts textile market sentiment

The sentiment in the industry is quite positive this year, as orders are being placed and manufacturing processes initiated around three to four months before any festival.

Eid-ul-Fitr is round the corner and the Ahmedabad city’s textile market is buzzing with activity. Retail demand is high, leaving the market in a bullish mode for the upcoming festival season. The order cycles typically run about four months ahead of each season, and processing houses in Ahmedabad, one of the largest cotton textile hubs in the country, have the capacity to churn out more than 3 crore metres per day.

There is a significant increase in orders from various states ahead of Eid. The sentiment in the industry is quite positive this year, as orders are being placed and manufacturing processes initiated around three to four months before any festival.

Despite concerns voiced by traders about the new MSME payment rule since January, the demand trend remains positive for the textile industry. The relatively low cotton prices, ranging from Rs 55,000 to Rs 61,000 per candy, add momentum to the demand.

The prices are considerably lower compared to the previous two years. With raw material prices dropping, manufacturers are able to produce fabrics more affordably, leading to increased volume and benefiting traders.

As the situation with the new payment rule normalises, there is hope that demand will continue for the upcoming festival season. Inventory levels are low in the supply chain, leading to a revival in demand.

Furthermore, the denim sector, a crucial segment of the textile industry, also witnesses resurgence in demand. Denim plants ramp up their operations, utilising approximately 90% of their production capacities. This indicates that the industry is bouncing back after a period of sluggish demand.

News source: The Times of India