Guntur: Pandemic deals a heavy blow to spinning mills
- Production falls by 50%with reduced demand for cotton yarn
- With migrant workers returning to home towns, mills are facing shortage of workers
- It is expected to take another 6 months before any turnaround in the situation
Guntur: Spinning mills in the state are facing shortage of workers as many migrant workers from Odisha had returned to their native places due to closure of mills during lockdown.
According to Spinning Mills Association sources, every spinning mill would engage 1,000 3,000 workers in three shifts. At present, there are 72 spinning mills in the state, which engage more than 1lakh workers. The workers who went to their native places did not return. As a result, the mills are facing 30 percent labour shortage. Some mill managements are providing advance payment for the workers to come back.
Shortage of workers, reduced demand for cotton yarn in domestic and international markets, fall of cotton yarn exports led to reduction in production. The mills earlier produced yarn worth Rs30 crore a day, now it has come down to Rs15 crore per day.
There are no cotton yarn exports due to Covid-19. Earlier, most of the spinning mills worked three shifts, now only two shifts are going on. This reduced the revenues to the managements.
Cloth mills, readymade garment units in Coimbatore and Gujarat have already reduced cotton yarn purchase due to less demand for cloth and readymade garments.
There is a fall demand for textiles during the festivals and marriage season due to reduced income during pandemic. The revenues of the mills went down due to cut in production. As a result, owners are not in a position to pay loan installments in time resulting rise in NPAs from 25 percent to 80percent.
Speaking to The Hans India, Andhra Pradesh Spinning Mills Association vice-president G V Krishna Reddy said, "Earlier, we had exported 90 percent of cotton yarn to China.
Due to outbreak of coronavirus and border disputes, China stopped cotton yarn imports from India. This is one of the reasons for lack of demand for cotton yarn. If the demand for cloth and readymade clothes increase, then demand for cotton yarn will too increase in the days to come. I hope it will take another six-months for the demand to rise for cotton yarn."