The price per kilogram of yarn in Egypt has more than quadrupled. About 51% of the textile factories in the Delta City of Al-Mahallael-Kobra have ceased operation, and the rest of the factories have gradually reduced their labor force.
In Al-Mahalla, the textile capital of Egypt, 650,000 workers in Egypt’s textile industry are facing unemployment. After the January 25,**, Egypt needs to exert great efforts to promote the operation of the economy.
“The government will inject capital for the troubled state-owned companies. However, it does not plan to inject capital for private enterprises,†said Mohssenel-Gilani, chairman of the woven, textile, cotton and clothing holding company.
State-owned enterprises lost EGP 530 million in the 2010/11 fiscal year, compared to a loss of EGP 2.3 billion in the previous year. The fiscal year of Egypt begins on July 1.
El-Gilani said that woven, textile, cotton and clothing holding companies have 32 subordinate state-owned companies.
"The holding company hopes that the government will adopt rescue measures to solve the difficulties with fair yarn prices," he said.
According to the report of the central government's public mobilization and statistics (CAPMAS), Egyptian cotton exports reached 2.2 million quintals in the 2010/11 fiscal year.
Domestic manufacturing companies consume 4 million quintals each year to keep the production line running. Each kilogram is equivalent to 150 kilograms of cotton, or 45 kilograms of ginning.
China, India and Switzerland are the largest importers of Egyptian cotton.
Some people believe that the domestic textile production enterprises in Egypt have been squeezed by the soaring price of yarns and the low price products in China flooding the country's store shelves.
The textile industry in Egypt, which has decades of history, is experiencing “a very critical situationâ€. Mohamedel-Morshedi, president of the Federation of Egyptian Textile Industry Textiles, said that “the production of Egyptian lint and cotton yarn cannot meet one-third of the needs of domestic textile companies. Yarn and textile companies are feeling the pressure to cope with Egypt's largest labor-intensive industry, "el-Morshedi explained.
In September 2010, the same yarn crisis hit Egypt's domestic textile industry, leading some production companies to withdraw from the market because domestic and international yarn prices hit a record high.
According to him, the current price of cotton has reached the highest level since the American Civil War (1861-1865), when the price of cotton rose from 10 cents/lb in 1860 to 1.90 US$/lb in 1863-1864.
The International Cotton Advisory Committee (ICAC) reported that the global cotton price actually fell in April, and the Cotlook A index fell to 1.73 cents/lb from the highest record of 2.44 US dollars/lb last month. However, prices remain at historically high levels. But the London-based organization predicts that yarn demand will be reduced due to high cotton prices and competition from chemical fiber.
The Egyptian factory was hit by a severe shortage of raw materials. There are no yarns or cotton on the market. Timely private factories have also been closed. Industry insiders called on the government to take immediate measures to save the textile industry.
El-Gohari said smuggling clothing into Egypt constitutes the largest vilification for Egyptian textile industry. Ending smuggling is the first step in helping the textile industry recover.
ICAC predicts that world yarn prices may decline next month, as total 2011 cotton supply is expected to reach 19665 kilos, and total usage is expected to be 1.5525 million bales.
In Al-Mahalla, the textile capital of Egypt, 650,000 workers in Egypt’s textile industry are facing unemployment. After the January 25,**, Egypt needs to exert great efforts to promote the operation of the economy.
“The government will inject capital for the troubled state-owned companies. However, it does not plan to inject capital for private enterprises,†said Mohssenel-Gilani, chairman of the woven, textile, cotton and clothing holding company.
State-owned enterprises lost EGP 530 million in the 2010/11 fiscal year, compared to a loss of EGP 2.3 billion in the previous year. The fiscal year of Egypt begins on July 1.
El-Gilani said that woven, textile, cotton and clothing holding companies have 32 subordinate state-owned companies.
"The holding company hopes that the government will adopt rescue measures to solve the difficulties with fair yarn prices," he said.
According to the report of the central government's public mobilization and statistics (CAPMAS), Egyptian cotton exports reached 2.2 million quintals in the 2010/11 fiscal year.
Domestic manufacturing companies consume 4 million quintals each year to keep the production line running. Each kilogram is equivalent to 150 kilograms of cotton, or 45 kilograms of ginning.
China, India and Switzerland are the largest importers of Egyptian cotton.
Some people believe that the domestic textile production enterprises in Egypt have been squeezed by the soaring price of yarns and the low price products in China flooding the country's store shelves.
The textile industry in Egypt, which has decades of history, is experiencing “a very critical situationâ€. Mohamedel-Morshedi, president of the Federation of Egyptian Textile Industry Textiles, said that “the production of Egyptian lint and cotton yarn cannot meet one-third of the needs of domestic textile companies. Yarn and textile companies are feeling the pressure to cope with Egypt's largest labor-intensive industry, "el-Morshedi explained.
In September 2010, the same yarn crisis hit Egypt's domestic textile industry, leading some production companies to withdraw from the market because domestic and international yarn prices hit a record high.
According to him, the current price of cotton has reached the highest level since the American Civil War (1861-1865), when the price of cotton rose from 10 cents/lb in 1860 to 1.90 US$/lb in 1863-1864.
The International Cotton Advisory Committee (ICAC) reported that the global cotton price actually fell in April, and the Cotlook A index fell to 1.73 cents/lb from the highest record of 2.44 US dollars/lb last month. However, prices remain at historically high levels. But the London-based organization predicts that yarn demand will be reduced due to high cotton prices and competition from chemical fiber.
The Egyptian factory was hit by a severe shortage of raw materials. There are no yarns or cotton on the market. Timely private factories have also been closed. Industry insiders called on the government to take immediate measures to save the textile industry.
El-Gohari said smuggling clothing into Egypt constitutes the largest vilification for Egyptian textile industry. Ending smuggling is the first step in helping the textile industry recover.
ICAC predicts that world yarn prices may decline next month, as total 2011 cotton supply is expected to reach 19665 kilos, and total usage is expected to be 1.5525 million bales.
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