In a bid to become competitive in international markets and improve margins, ginners from India are turning to the West for superior technical know-how and better production practices. Leading Indian cotton ginning and spinning companies will discuss advanced ginning and spinning practices with their American counterparts at the International Cotton Summit in Ahmedabad on April 9 and 10.
"The lack of access to better technology has resulted in small and medium players producing inferior-quality cotton and yarn. India's spinning and ginning industry is facing global competition. We need technical upgradation by engaging with global players," said Anand Popat, secretary of the Saurashtra Cotton Ginners Association.
The summit is being organised by the Textile Association of India, the Textile Machinery Manufacturing Association and Diagonal Consulting India.
Close to 50 delegates from the Western ginning and spinning industry have been invited to discuss the use of better production practices and superior technology. The theme of the summit is 'Challenges Facing Indian Cotton', and international players will share their experiences with over 600 participants from India.
"Margins have reduced and our competitiveness is under threat. We need to upgrade to survive. Processes such as loading, transportation, packaging as well as contamination in fibre are some of the major challenges faced by the ginning industry," said Chirag Pan, CEO, Jaydeep Cotton in Saurashtra.
Gujarat currently has about 750 ginning units, operating at 40-50 per cent capacity utilisation. Lower capacity utilisation adds to the financial burden of these small- and medium-level ginners.
Insiders said the ginning industry has been hit by a double whammy. On one side there is the rising price of cotton; on the other there are quality issues. Traders said that raw cotton prices had recently reached Rs 5,000 per quintal, higher by around Rs 1,000 per quintal than they were a few months ago, while the price of processed cotton had fallen from Rs 40,000 per candy (one candy = 356 kg) to around Rs 39,000 per candy in the past few days.
"After the new textile policy announced by the state government, we expect new investments to be made in the ginning and spinning sector," said Pan.
The industry estimates that transportation of processed cotton to spinning units in the southern region costs around Rs 800 per bale; this cost can be saved by setting up a unit in Gujarat, traders noted.
"With the help of this conference we will be able to spread the word about the state's textile policy and attract fresh investments in the ginning and spinning business," said Popat.