Knitwear exports earnings fall by 26%

Tirupur exported 2.87 crore pieces worth Rs 183.95 crore (at the exchange rate of Rs 38 a dollar) during May 1998 compared to 1.95 crore pieces worth Rs 155.59 crore (at the exchange rate of Rs 35 a dollar) exported during May 1997. However, the quantity shipped is a record high as April-September period is generally considered lean.

The jump in quantity for May 1998 over that of May 1997 is around 47 per cent but that in value is only 18 per cent.

If exportsfrom the hub of knitwear activity in the south during May 1997 had yielded an average realisation of Rs 79.78 a piece (at the then exchange rate of Rs 35), average realisations during May 1998 was Rs 64.09 (at the exchange rate of Rs 38). In fact, the Tirupur exporters could realise an average rate of Rs 76 during May 1996.

Sources pointed out that export of low-value items, like women’s undergarments, still play havoc with the realisations. The same problem had resulted in a negative growth in export realisations during the last calendar for the first time since the town caught the eyes of the global buyer. The average realisations during 1997 was only Rs 71.29 against Rs 78.34 in 1996 and Rs 73.32 in 1995. However, some exporters do not rule out the possibility of global recession and undercutting by competitors for the drop in realisations.

Cotton knitted garments’ exports from Tirupur, which accounts for over 80 per cent of the total exports of the commodity from the country, for the first five monthsof 1998 is valued at Rs 1,087.21 crore (16.22 crore pieces) against Rs 973.89 crore (14.88 crore pieces) worth of exports in 1997.