AMARAVATI: The spinning mills of Andhra Pradesh are on the verge of closure. The AP Spinning Mills Asso-ciation has decided to observe a full day production holiday on every Wednesday of the week unable to bear the production losses. As many as 120 spinning mills will start the production holiday protest from July 13 and APSMA is demanding the government to save the spinning mills. The owners of spinning mills are alleging increase of cotton by 55 per cent this year, which is a record and this is forcing them into financial difficulties.
AP Spinning Mills Association chairman, P. Dharma Teja said that after completion of the sale of cotton pertaining to 2015-16 crop by AP cotton farmers, some of the multi-national and local trading companies have resorted to hoard the cotton and selling it with a vertical increase in cotton price by 55 per cent. This is severely affecting the entire spinning industry in the state, further incurring heavy losses.
He explained that the main reason for this sudden and unusual increase of cotton price is due to allowing the multi-national and local trading companies by Cotton Corporation of India (CCI) to participate in their daily cotton auction along with the spinning industry. Mr Teja mentioned that the price of cotton has been increased from Rs 35,000 to Rs 48,000 and racing towards Rs 50,000 mark. But the yarn price is not increasing commensurate with the increased cotton price and quoting at normal international price. Because of this parity in yarn production and marketing cost, the industry is losing heavily from Rs 25 to Rs 30 per kg yarn.
The spinning industry is not in a position to bear such huge losses. He said that the general body of APSMA has unanimously resolved to declare one day per week as production holiday.
Mr Teja warned that if the prices fail to come down with one-day production holiday, APSMA has decided to observe production holiday for two to three days in the coming days. Mentioning that spinning industry in Telangana and Maharashtra states recovered due to the support from respective governments, he said that APSMA is seeking AP government intervention and release of pending incentives to save the spinning mills from closure which were providing employment to thousands of people.
