Smaller denim exports see dip in orders

The ongoing uncertainty in the global economy, especially

in the West has resulted in a fall in denim exports. This in turn has hurt India’s denim industry and especially exports. Denim players are experiencing a decline in orders even in the on-going peak season. Exporters have piled up of stocks, which has led to pressure on manufacturing costs.

Fall in export orders coupled with inability to divert the stocks into domestic market owing to competition with large players has put exporters in a dilemma. They are worried about the ongoing situation. Reduction in orders was noticed widely in small and medium size players, who constitute around 55 percent of the market.

On the other hand, large players faced no slowdown because of their long-term contracts with overseas buyers. Payers like Arvind Mills, Aarvee Denims and K G Denims constituting around 24 percent, 12 percent and five percent of the market, have largely been unaffected so far.

India’s annual denim production stands at 700 million metres, of which around 32 percent is exported. According to an industry estimate, India’s total denim exports were recorded at around 180 million metres last year, which may go marginally up to 200 million metres this year.