Clicky
National, Front Page

Overseas buyers worried

Traders search alternative source for raw materials


Published : 13 Feb 2020 09:35 PM | Updated : 06 Sep 2020 03:13 AM

Due to the sudden outbreak of coronavirus in China, overseas buyers, who have already placed purchase orders, are worried whether they would get their products from Bangladesh in due time, said concerned traders. Informing that one-fourth raw materials for the country’s industrial sector comes from China, exporters said that factory owners are now looking for alternative sources for import of 

chemicals and different accessories as the stored volume is about to be finished. Several importers said that they are afraid they would have to pay exorbitant prices. “On the other hand, we are in doubt whether quality of raw materials would be up to to the standard,” they apprehended.

With coronavirus spreading its menace both within and outside China, trade fairs organisers have either cancelled or rescheduled the exhibitions to a later date. Organisers cited travel security and well-being of the participants as the prime reason for postponing the fairs that were to be held in Bangladesh.

As a result of the Coronavirus outbreak, Bangladesh’s manufacturing sector, especially readymade garments, textile, plastic and leather, is set to face a supply disruption as the outbreak has cut communications between the two countries to some extent. Manufacturers have already felt the pinch as the supply chain has already started suffering. MB Knit Fashions of Narayanganj manufactures apparel in several companies in Europe and America. Foreign buyers are concerned about the timely delivery of the goods.

The delayed arrival of imported raw materials will affect the timely delivery of the shipments of manufactured goods. “We cannot start production unless the deliveries of accessories and fabrics are confirmed. The big concern is meeting the shipment deadline, because buyers may not cooperate if our deliveries are delayed”, said Mohammad Hatem, the owner of MB Knit Fashions.

“In this case, if the foreign buyers do not give us discount, we have to incur huge financial loss. At the end of the month, it will be difficult for many to pay wages to workers”, he added. Over 50% of Bangladesh’s textile and textile-related goods including garment accessories are imported from China. In addition, about 40% of capital machinery and spare parts for the textile and garment industry come from the country. The extension of the New Year holidays in Coronavirus-struck China has created deep concerns among businesses in Bangladesh.

Swedish clothing-retail company H&M is the largest buyer for Bangladesh's clothing products. Ziaur Rahman, head of the Bangladesh office of H&M said, the situation is tolerable till now. However, if the issue of Coronavirus is prolonged by two to three months, then Bangladesh's export trade could suffer. Last year, H&M purchased garments worth $300 million ($3 billion) from Bangladesh. 84% of Bangladesh's exports come from the garment sector. However, in the current financial year, export of garment products is declining. The impact of exports on the Coronavirus issue will raise new concerns.

International fair postponed in Dhaka 

A few international exhibitions have been postponed in Dhaka over the Coronavirus issue. Due to the large number of participation of Chinese institutions and citizens in these exhibitions, it has to be cancelled. The exhibition of textile and garment machinery organised by Bangladesh Textile Mills Association (BTMA) was scheduled to start from February 25, 2020. But BTMA secretary Mansur Ahmed said the exhibition had been cancelled immediately. The exhibition is one of the largest exhibitions in Southeast Asia. 1650 institutions from 36 countries were supposed to take part in the fair. Of these, about 300 are Chinese companies.

The International Plastic Expo has also been cancelled. CEMS Global is one of the organisers of international trade-related exhibition in Dhaka. The company has suspended three exhibitions so far. These include the Dhaka International Fabric Show, Food Products and Exhibition of Medical Equipment and Health Tourism. The exhibition was supposed to start from this month to April 2020.