Elahi Cotton Mills Limited has announced that it will temporarily shut down production for ten days, citing low demand for its products in both local and international markets.
The company, a manufacturer and seller of yarn, shared the development in its filing to the Pakistan Stock Exchange (PSX) on Monday.
“Due to severe recession in local and international markets with regard to demand and rate of polyester and yarn, the Board of Directors of the company, in a meeting held today, have decided to close down production activities of the mills for ten days with effect from October 16, 2023,” read the notice.
The development comes as the country’s crucial textile sector, responsible for a majority of Pakistan’s exports, remains under pressure amid a plunge in demand and escalating economic woes.
Pakistan’s textile exports have been on a downward slide, clocking in at $1.35 billion in September compared to $1.53 billion recorded in the same month of the previous year for a year-on-year decline of 12%, showed provisional data released by the All Pakistan Textile Mills Association (APTMA).
Weeks ago, Shahzad Textile Mills Limited, another yarn manufacturer, announced to curtail its operations for an ‘indefinite period’ citing economic issues.
“Due to lesser market demand for yarn, and other economic adversities, the board of directors has decided to shut down Units No. 1 and 4 from September 29, 2023, for an indefinite time,” said Shahzad Textile Mills Limited.
“We believe that this strategic decision will lead to several long-term benefits for our company,” the company said back then.