BAKU, Azerbaijan, Oct. 29
Trend:
The Uzbek Textile Association warned of the possible introduction of a surcharge on yarn export in November, Trend reports referring to the association's press service.
According to the information, as a result of a sharp rise in prices for cotton and yarn in world markets since September 2021 and the growing demand for Uzbek yarn from foreign partners (primarily from Turkey), there has been an ‘unreasonable rush’ for cotton yarn in the domestic market.
The association reports that an average of 71,000 tons of yarn of all types are produced per month, while about 28,000 tons are supplied to the domestic market.
It is noted that to stabilize supply and demand for yarn, Uzbek Textile Association is taking the following measures:
- once a week, information on the production of cotton fiber and yarn will be published. Also, data on the proposals of suppliers will be provided;
- to limit speculation, the starting price for cotton fiber will be set at the level of the New York Stock Exchange (or based on the cost of raw cotton if prices fall), and its highest price - according to the Cotlook A index;
- it is planned to expand the import of cotton fiber, synthetic and man-made fibers, as well as yarn;
- it is planned to expand the practice of providing working capital to consumers of yarn, improve the VAT refund mechanism and provide a deferral for its payment. In addition, proposals are being prepared to exempt the sale of yarn to the domestic market from income tax.
The association warned that if the volume of yarn in the domestic market does not stabilize, then in November 2021 the practice of temporary surcharges for the export of yarn (in the context of enterprises and grades) will be introduced.
