The severe flooding in Pakistan is directly affecting the sales of domestic towels here in Taiwan. This year's revenue has fallen 40 percent compared to the same period last year because of the substantial reduction in cotton imports.

With some hypermarkets refusing to adjust to the soaring cost, and business owners importing poor quality towels to cut down expenses, consumers are indeed becoming the victims of this price battle.

These towel-making machines are running non-stop.

Domestic cotton imports mainly come from Pakistan, though recent flooding has greatly reduced cotton exports affecting the international price of cotton yarn which has increased more than 60%.

Because raw material prices of cotton and other upstream costs have increased, the industry has hiked costs though some hypermarkets are unwilling to accept the new price.

This has led to an additional import of cheaper towels, transferred through a third country with some even getting the Made in Taiwan brand.

This has led to lots of confusion as the Industry said that in the past few years, they have gradually transitioned to new operations such as opening the towel factory to tourism and making towels in the shapes of cakes.

Still, they are commanding just 20% of the of the local market.

What is important now is they say is the government should investigate the problem of poor quality towels to help both consumers and this local industry.