June 7: The carpet weaving belt of Dhadohi-Mirzapur which now extends from Ballia and Varanasi in eastern Uttar Pradesh to the interiors of Bihar procures its supplies of raw wool and woollen yarn mainly from Bikaner in Rajasthan and to a lesser extent from New Zealand.Since this belt specialises in mass production of cheaper, lower quality carpets for export, almost 70 per cent of raw wool consumed in this region is procured domestically from Bikaner where there are special wool mandis or markets. According to Ashok Kapoor, the newly elected president of the Eastern UP chapter of PHDCCI, himself a carpet exporter, prices of raw wool from Bikaner fluctuate with variations in the local demand-supply positions. Apart from that, the general health of the wool-bearing animals can also cause variations in prices of wool in the domestic market.Interestingly, there are seasonal variations in the prices of wool in the domestic market as well. For instance, explains Kapoor, prices of wool are the lowest duringthe rainy season since wool tends to absorb moisture and becomes heavier at this time. Most carpet manufacturers therefore abstain from buying wool during the monsoons. Transient factors such as industrial sickness can also have an impact on the prices of carpet-grade wool. The overall recession in international markets for luxury goods and the subsequent decrease in demand has resulted in the lowering of wool and yarn prices considerably.At present, prices of Indian wool hover in the range of Rs 130 per kg for 48-60 count thickness good grade Indian wool, while the inferior coarser grades of 30-40 count thickness, which is mainly used for Gabbeh carpets which are in great demand in the German markets in particular, are priced at around Rs 100 per kg or thereabouts. According to Kapoor, most carpet manufacturers of the Mirzapur-Bhadohi belt buy wool from representatives of spinning mills in the form of woollen yarn. Most spinning mills in the North are located either in Rajasthan or in Panipat inHaryana which has a thriving textiles industry of its own and therefore has an abundance of spinning mills.Of late, however, several large carpet manufacturers have resorted to backward integration of the industry and have set up spinning mills of their own as well in the Mirzapur-Bhadohi region catering not just to their in-house yarn requirements but the surplus is sold to smaller manufacturers as well. Industry sources maintain that setting up of local spinning mills have resulted in stabilising the prices of carpet grade yarn to a considerable extent since it has freed the industry from the shackles of manipulative yarn agents to a great degree.But apart from domestic raw wool supply, large carpet manufacturers in the area procure at least 30 per cent of their raw wool requirements from New Zealand for the manufacture of finer quality luxury carpets. The prices of New Zealand wool fluctuate weekly as wool auctions in NZ are held every Thursday. The weekly auction price of New Zealand wool isavailable from Wools of New Zealand, the operating identity of the New Zealand wool Board which is an independent statutory body funded by wool producers of New Zealand. The country office of Wools of New Zealand is located in Delhi and supplies weekly price information to bulk consumers by fax or mail while smaller manufacturers can contact their office for requisite information.Industry sources say prices of imported wool fluctuate by as much as 2 to 4 per cent every week. Though the demand and supply position of the Indian carpet industry has virtually no impact on the prices of New Zealand wool, considering the fact that wool export to India constitute a minuscule percentage of New Zealand's total wool export, fluctuations in the value of the US dollar do have a direct impact on prices. In addition, any fluctuation in the New Zealand wool market immediately affects the import prices of wool. At present, the price of New Zealand wool in the international market is in the vicinity of $2.5 per kg. Tothe Indian carpet exporter, however, this is available for around Rs 170 per kg while the higher semi-worsted quality can cost as much as Rs 200 per kg. Many of the large New Zealand wool exporters have their local agents in India. These include a Dewavrin Fils (NZ) Limited which is represented by Arihant Sales and Exports among a host of others. On conservative estimates, the Mirzapur-Bhadohi belt itself consumes wool worth over Rs 300 crore both from the domestic and international markets, according to industry sources.
