The newly-elected chairman of the Southern India Mills' Association (Sima) M Ramaswami feels the current spate of restructuring taking place in the textile industries located in Far-East countries would provide Indian spinners an advantage to cater to a larger market. ``Mills in some of the countries, especially in Taiwan, are up for sale. We could see some demand for the finer counts of yarn. Moreover, Chile and Colombia hold good potential for our cotton yarn and blends,'' he claimed.

Yarn of 20s, 24s, 30s and 40s counts in cotton and poly/cotton are usually used in the Chilean market. The market size is estimated to be about 400 tonnes a month for cotton yarn and 600 tonnes a month for poly/cotton yarn and some PV and acrylic yarn. Recently, according to the spinners here, a 50,000 capacity spinning mill was closed. Chile imports yarn from China,Pakistan and Brazil. China, which is strong in the estimated 60 per cent poly/cotton yarn markets of Chile compared to Pakistan (strong in cotton yarn markets), has the advantage of freight cost and shipment time.

According to spinners, who were part of the Cotton Textiles Export Promotion Council's (Texprocil's) delegation to Latin American and Far-East countries, there is ample potential for supply of yarn for the knitting industry of Chile. Hardly any yarn is used for weaving.

There is also a market for Melange yarn and for Melange yarn twisted together with dyed yarn in Chile. Even Colombia has a good market for knitting yarn, which forms 80 per cent of the requirement. The opportunity to export to Colombia has increased of late, as enthusiasm in local spinning activity came down. ``There is good demand for quality cotton yarn of 16s, 20s and 24s singles and doubles mainly carded. Some quantity of Melange yarn also can be moved in,'' according to the exporting community.

Here it may be noted exportsof cotton yarn towards Colombia during the current calendar has not been good. During the first six months of 1999, cotton yarn exports from India to Colombia declined by 50 per cent to Rs 16.50 crore compared to Rs 33.30 crore worth cotton yarn shipped during the corresponding period in the previous calendar.

Exporting member mills of Sima also consider Brazil as a potential market since the spinning industry there is slowly buckling under pressure. The local spinning industry currently meets almost 90 per cent of the yarn requirement in the country. Unlike Chile or Colombia, around 75 per cent of the requirement of Brazil is for cotton yarn.

According to the exporters, who had visited Shanghai, Seoul, Taipei and Hong Kong, results of the large scale restructuring exercise being carried out in China, would to a large extent, be a deciding factor in the future prospects of spinning players in nearby Asian countries. China, according to them, views India as a major competitor and threat.

In Korea toocompanies are relocating to Caribbean/Latin American countries and Vietnam. Korea, which consumed Indian cotton yarn valued at Rs 473.25 crore during the January-June 1999 period compared to Rs 98.70 crore worth yarn consumed during the 1998 corresponding period, expects a high quality of yarn. India is the largest exporter of cotton yarn to Korea.

The high labour cost in Taiwan has resulted in the winding up of some of the spinning mills. According to exporters, the perception that countries like Taiwan and Korea would accept lower quality cotton yarn should change. Most of the spinning industry in Hong Kong has shifted out to Indonesia.

The Bleachers and Dyers Association of Hong Kong consider India as the cheapest source for greige goods in Asia. Though there is a preference for Chinese cotton yarn, Hong Kong is rated as the third biggest importer of Indian cotton yarn next to Bangladesh and Korea. However, cotton yarn exports to the country declined to Rs 402 crore for the first-half of 1999 comparedto Rs 481 crore achieved during the January-June 1998 period.