Proposed Solutions to the Raw Material Problem in the Textile Industry

Istanbul Ready-Made Clothing and Apparel Exporters Association (İHKİB) Chairman Mustafa Gültepe stated that Turkey's cotton yarn exports increased 68.4 percent compared to 2020 during the January-October period. In his remarks on the raw material issue, he said: "Looking at the 10-month averages, we see fibre being exported at 2 dollars, yarn at 4 dollars, and fabric at 6-7 dollars. However, if we process these products and convert them into ready-made clothing and apparel, we can sell them at 16-17 dollars, increase our value-added exports and earn significantly more foreign currency for our country." Gültepe spoke at a press conference where five ready-made clothing and apparel exporting associations that signed off on 20 billion dollars in exports, along with 13 industry associations, unveiled their solution formula against the raw material crisis. Reporting that the sector will complete 2021 with record exports above 20 billion dollars, Gültepe said: "Commodity prices on international markets increased 20 percent on average in dollar terms over the past year. In Turkey, this rate stands at 35-40 percent. We face much higher price increases in cotton and cotton yarn. Over the past year, cotton prices rose 57 percent globally and 86.6 percent in Turkey. We are buying cotton yarn domestically at 0.80-1 dollar more expensive than international market prices. Apart from price increases, we also face supply problems. Raw materials that previously arrived in 2-3 weeks now reach us in 4-5 weeks. Due to the problems we experience in raw material procurement, our delivery times are extending and occasionally we are forced to reject orders. To meet our raw material needs, we want export monitoring applied to cotton and cotton yarn exports, and we demand that additional customs duties applied to yarn imports be lifted."

Target should be value-added exports

Recalling that significant order shifts from China and Asian countries to Turkey occurred this year, Gültepe stated that they were unable to take full advantage of this opportunity due to problems in accessing raw materials. Noting that there was significant growth in cotton and cotton yarn exports during the period when the ready-made clothing and apparel sector most needed it, Gültepe expressed his thoughts as follows: "For example, during the January-October period, cotton yarn exports increased 68.4 percent compared to 2020 and 30.4 percent compared to 2019. Our target should be value-added exports. Looking at the 10-month averages, we see fibre being exported at 2 dollars, yarn at 4 dollars, and fabric at 6-7 dollars. However, if we process these products and convert them into ready-made clothing and apparel, we can sell them at 16-17 dollars, increase our value-added exports and earn significantly more foreign currency for our country. Our loss is not only in value-added exports. Unfortunately, due to short-term calculations, we are also reducing our competitive strength in global markets. Because we export significant portions of fibre and yarn to competitors such as Portugal, Italy, Bangladesh, Pakistan and Egypt. During the January-October period, 56.6 percent of our total cotton yarn exports went to these five countries."    

ISTANBUL (AA)