OE mills to halt production due to high prices of raw material

COIMBATORE: Open End (OE) spinning mills producing grey cotton yarn have announced halting operations from November 7 protesting against high price of cotton waste and as well as demanding a rollback of power tariff.

Addressing the media, Tamil Nadu Open End Mills Association (OEMA) president G Arulmozhi said prices of cotton waste have increased sharply over the last one year from Rs 97 to Rs 117.

“The OE mills could resume operations only, if prices of cotton waste reduce by atleast Rs 20,” he said.

Tamil Nadu has around 6O0 OE mills, which produce a range of value added products with waste cotton, used fabric and as well as by recycling pet bottles into fibre. Of them around 400 OE mills are concentrated in Coimbatore, Tirupur and Erode districts alone.

The OE mill owners have demanded the state and central government to intervene to take measures to keep the prices of waste cotton under check.

“Either export of cotton waste should be banned or 11 per cent import cess on cotton should be lifted. Similarly, the state government should roll back fixed hour charges and peak hour charges on electricity. Because of power subsidies, Gujarat exports 2,000 containers of waste cotton while not even 100 containers could be exported from Tamil Nadu due unfavourable conditions,” he added.

The OE mills have planned to halt production till November 30 initially and extend if the market scenario does not improve.

They claimed that only 50 per cent of production happens and already more than 50 mills have halted operations due to heavy loss.

Strike may hit production of around 40 lakh kg of grey yarn per day and cause production loss of Rs 60 crore on a daily basis. More than one lakh workers will lose jobs directly and another one lakh indirectly due to strike.