Report — 28 July 2023

Tariff surge and expensive yarn squeeze weaving across Faisalabad region

Summary

Reporting from July 2023 described raised electricity tariffs and higher yarn prices as a dual shock squeezing power-loom owners in Faisalabad and nearby cities. Several owners interviewed outlined production cuts and temporary shutdowns as survival tactics pending relief.

Sector read-through

When yarn price volatility overlaps with energy hikes, greige fabric conversion spreads disappear. With limited access to concessional finance, SME weavers face cash-flow breaks that rapidly cascade into arrears and asset distress.

Implications for APPLA

• Advocate targeted, time-bound energy rebates during raw-material shocks to prevent utilization collapse.
• Encourage forward buying pools or framework agreements with spinners to dampen price spikes.