Local Cotton Highlights:
- Last week, the textile and spinning mills had shown interest in the buying of cotton and due to the increased supply of Phutti because of which the trading volume has significantly increased. It seems that activity will improve with the passage of time based on further arrival of cotton.
- The supply of Phutti is increasing day by day in the province of Punjab and ginning factories have also started their operations. The arrival of Phutti from Balochistan has started partially.
- The price of local cotton remained stable during the week due to the downward trend of NYCF but it seems that local cotton prices will increase in the coming days. The Karachi Cotton Association (KCA) spot rate (2019-2020) closed at the same previous level of 8300 per maund after fluctuation of 100Rs.
- Mixed trend has been seen in the Chinese market. The bearish trend was seen in the prices of cotton in India, although the production of cotton in India is expected to be three crore ten lac bales which is 55 lac bales less than the initial estimate of three crore 65 lac bales.
- Due to the imposition of 10 percent sales tax on cotton and 17 percent sales tax on textile products by the government in budget business was affected badly. So kind of uncertainty is being observed among the traders and buyers
- Prices of seed cotton (Kapas/Phutti) for the new crop (2019-2020) in Sindh were in range from Rs 3600 to Rs 4100 per 40 Kgs and new crop phutti is available from Sindh in range from Rs 7800 to Rs 8500 per maund (37.32 Kgs).
- In Punjab prices of seed cotton was in range from Rs 3700 to Rs 4200 per 40 Kgs and new crop phutti is available from Punjab in range from Rs 7800 to Rs 8600 per maund (37.32 Kgs). Overall deals were made between the range of USC 60~66 Lbs. (7,800~8,600/ maund).
New York Cotton Futures:
- New York Cotton futures opened on lower level on Monday as compare to previous week’s closing figures.
- NYCF dropped in next session, later recovered and then dropped in next two consecutive sessions, then closed on negative side by the end of the week.
At last day of the week, OCT 2019 closed at 62.36 with decrease of 277 points.
At last day of the week, DEC 2019 closed at 62.68 with drop of 296 points.
At last day of the week, MAR 2020 closed at 63.74 with lower of 296 points
|Closing of NYCF’s|
|Oct 19||62.36 cents / lb||-2.77 cents/lb|
|Dec 19||62.68 cents / lb||-2.96 cents/lb|
|Mar 20||63.74 cents / lb||-2.96 cents/lb|
A was opened at 78.35 with same level from previous week’s closing figure.
- In this week Index “A” showed downward trend and at the end closed on negative side.
- At last day of the week, LPI “A” closed at 74.80 with decrease of 355 points as of opening figure of the week.
Crude Oil prices opened at USD 57.66 with slightly higher level as compared to last week closing figures.
- In this week, crude oil prices showed mix trend in whole week and closed on positive side at the end of week.
- In last day of the week, Crude Oil price closed at USD 60.21 with increase of USD2.55 cents as of opening figure of week.
Pakistan Currency Exchange Rates
- In last week values of Pak rupee depreciated against US Dollar’s, other major currencies showed mix trend in both Interbank and open markets.
- At the end of week, Euro closed on a positive note with figure of 1.13 and British Pound also closed on positive note with figure 1.26 against USD.
|Exchange Rates USD.|
- Local yarn market remained under sale pressure and limited sale finalized during last week ended. Customers were buying for their urgent required orders and most of them were waiting for more pressure or correction in market. On the other hand, spinners were interested on their sales as lifting/payment was also slow in the market after GST implementation by Govt.
- PSF price remained stable during this week ended in domestic market. PTA, MEG and Crude oil prices was stable in international market, but China import fiber price dropped by end of this week. It is expected price for fiber in domestic market will remain stable.
- Faisalabad trading market remained close in term of sale and no yarn buying reported from mill. All was waiting for Tax issues and no sale made.
Following are current asking prices of yarn in local market based on ex mills:
|Local Yarn Prices Range|
|Count||Price US $/Bale|
|16/1 CD||420 to 435 per bale|
|20/1 CD||440 to 465 per bale|
|30/1 CD||505 to 525 per bale|
|20/1 CM||520 to 530 per bale|
|30/1 PC 52:48||410 to 440 per bale|
|40/1 CM||620 to 635 per bale|
|60/1 CM||905 to 920 per bale|
|80/1 CM||1175 to 1290 per bale|
- Market remained under average business activity with slight improvement in demand from buyers. Over all customers kept on checking prices and good numbers of enquiries were received. In response to that, order confirmations remained nominal as suppiers are not in a mood to show any further improvement in prices.
- Customers are bidding on lower side considering decline in prices in days to come. Major reason for this uncertain behavior is conducive weather conditions in USA which has given boost to cotton crop size. So, cotton prices might show weak sentiment in days to come.
- HK customers remained silent and no such activity has been witnessed. European customers floated limited enquiries. Although this is the buying time for European customers before going on holidays but this time, business have shown quite a depressed activity.
- The local fabric market remained slow and stagnant till the end of the week. Week started with limited activity for both narrow and wider widths with hint of for both narrow and wider width fabric markets.
- Major weavers are booked till mid ~ 3rd week August for narrow width and end August -early September’19 for wider width looms and offering onward deliveries.
Local fabric prices of regular items are as follows:
20×16/128×60=63”at USD 1.11 to 1.13 per yard, 16×12/108×56=63” in range of USD 1.20 to 1.22 per yard and 20×20/108×58=63” was sold in range of USD 0.93 to 0.95 per yard based on ex mills.
- Improved market activity was witnessed from Fareastern markets. Korean customers were discussing basic sheeting orders and placed the same with their selected suppliers. China, Japan and Bangladesh customers were also active and booked decent quantities during the week. Vietnam, Thailand and Indonesian markets were mixed with limited business activity. Prices were stable during the week due to stable raw material prices. Good suppliers are booked till end of Aug whereas average suppliers are booked till early of Aug and offering mid Aug onward deliveries.
Following were the closing rates based on CNF Far Eastern ports.
20×16/128×60=63”, in range of 1.12 to 1.14 per yd, 16×12/108×56=63” between USD 1.22 to 1.24 per yd and 20×20/108×5863” in range of USD 0.93 to 0.95 per yd based on CNF Far Eastern ports.
- European customers have taken interest in fresh buying thus good activity has been seen from Italy, Germany and Portugal. Other markets like Spain, France and Belgium remained slow during the week under review. Turkish market was little bit active as customers have booked good quantities both in narrow and wider width fabric.
- Wider width suppliers have got good orders from various parts of Europe as well as from USA thus they are comfortably booked till end of Sep and now offering Oct onward deliveries. Prices for wider width remained stable during the week.
- Suppliers are expecting good demand from Europe and USA in coming days as well in narrow and wider width.
Bed Linen & Towels:
- Home textile market was firm during the last week. Customers floated few inquiries in the market & maturity of business was firm. USA Market was slightly better and customers floated good inquiries. Good business activity seen in the market in terms of order placement. European markets business was also firm.
- Prices remained firm during the last week. As far as shipments are concerned supplier is offering 60 to 70 days for new orders & for repeat orders supplier are offering 50 to 60 days.
- Pakistan’s total annual apparel exports are currently USD 6bn. To increase exports we are putting efforts to enhance our product lines and relax our import policy for raw material. At the same time Pakistan’s apparel industry is geared up to meet the world’s demand of technical, casual, functional and fashion apparel.
- Current govt is taking measures to make such import policies which would ease out to procure raw material on convenient terms. Efforts are being put on to find new markets. Govt is also talking about revising free trade agreement with China including a relaxed visa regime for Pakistani exporters seeking trade in China.
- Factories are working on their full capacities to meet the orders in hand and offering shipments from end September onwards. Despite devaluation of Pak Rupee against USD which has caused the raw material go high, prices of garments are attractive for buyers.
- In Local Yarn it is expected that the market will come under sale pressure due to slow buying mood from buyer and prices will get stable after some correction or bulk cotton arrival will determine the price for this new season. Further price trends of yarns will be according to demand and supply of different counts which will lead price level.
- Uncertainty may continue to grip the Local Fabric Market for coming weeks however prevailing slow market sentiments may also put pressures on weavers.
- In Export Fabric Market the Fareastern markets saw an improvement in business with decent quantity booking with stable prices. European and USA markets remained active and good bookings observed both in narrow and wider width fabric, this effect will continue in the coming week.
- In Bedlinen and Towels overall market was firm, keeping in view current market scenario it looks business will be further improve if prices remain stable as they are right now.
- In Apparel industry efforts are being put on to increase production lines to cater to the increased demand from the global buyers and Pakistan’s government is working on the policies to ease out trade.