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Knitwear's minimum export price to be fixed July 5

Repayet Ullah Mirdha
The decision of fixing the baseline prices of exportable knitwear items will be taken on July 5, as the leaders of the manufacturers are conducting an extensive survey at factory level to know the production costs.
The knitwear manufacturers have been working on the issue of fixing the baseline prices of some basic knitwear items over the last few months, as some factory owners are selling their products with a minimum profit margin creating an uneven competition.
The knitwear exporters are trying to set the baseline prices with the aim to increase the prices of exportable items and enhance workers' wages, said Fazlul Hoque, president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).
The fixation of the baseline prices of some basic knitwear items will prevent the exporters from selling the items with marginal profit, as they will not be able to sell the items below the baseline prices, industry insiders said.
Hoque said they will hold an extra-ordinary general meeting (EGM) on July 5 to take decision on baseline price fixation of basic knitwear items.
Another important meeting of a specialised sub-committee of the association on price fixation will be held today to discuss the progress in the price fixation matter.
At present, BKMEA is conducting the survey at factory level to know the actual costs of production of per unit of basic knitwear item, as the selling prices will be fixed on the basis of production and other costs.
Talking to The Daily Star, Hoque said they have decided to conduct the survey at 40 to 50 big factories across the country to take the decision.
The BKMEA has already conducted such survey at more than 25 factories to know the production costs of items, Hoque said.
Despite increases in costs of around 15 percent and price fall of the item by 1 -2 percent in the last year, intense competition in the sector has meant producers have been unable to pass the higher costs on to buyers.
According to the industry, the erratic gas and power supply, higher freight charges both in local and international markets, the yarn price hike, implementation of the minimum wage for workers, higher transport costs and higher prices of capital machinery were the main reasons for the higher cost of doing business over the last year.
"Sometimes many foreign buyers take advantage of our unhealthy local competition,” Hoque said.
reefat@thedailystar.net