India Might Start Enforcing Quality Control Order on Viscose Staple Fibre

Indian manufacturers may begin implementing the Quality Control Order (QCO) on Viscose Staple Fibre (VSF) beginning on the month of March 29, 2023. According to sources, international plants making VSF are yet to acquire accreditation, which can potentially disrupt the imported supply. The largest producer, Grasim Industries Limited, has obtained certificates for its domestic operations; therefore, the domestic supply is anticipated to be unaffected.

The Ministry of Textiles (MoT) published the VSF QCO 2022 notification on the month of December 29 of last year, with a one-month implementation deadline. However, in order to give the industry time to get ready for compliance, the government allowed extensions. As per the sources, the extension will assist Indian manufacturers in meeting their prior supply promises. In order to give the industry more time to comply with the QCO regulations and make sure that already-shipped VSF orders are not impacted, industry organizations pleaded with the government for the extension, citing India's reliance on VSF imports.

Market sources further claim that Grasim Industries Limited, the largest manufacturer of VSF, is poised to carry out the order beginning on the month of March 29, 2023. The industry has certification for its local facilities but has not yet gained certification for its international operations. However, Industry experts claim that there is little chance of a significant increase in the cost of production following the introduction of the QCO, which might prevent VSF price. As per the ChemAnalyst database, the current price for VSF in the Indian market dropped by almost 3%, with prices hovering at USD 1817/MT on Ex-Location, while imported material also witnessed a drop by 3.6% during the week ending March 24, 2023.

Conclusively, ChemAnalyst reported that "The probable disruptions in the supply of VSF could result in a price increase in the Indian market."