Local Cotton Highlights:
- Last week, in the local market textile mills and buyers showed steadier trend and were interested to make deals of fine quality in fear that the prices may flare up in coming days upon improved arrival. Supply of cotton is gradually increasing and it is expected that trading volume will be increased in coming days.
- Ginning factories are becoming operational due to the increase in the supply of Phutti in Sindh and Punjab. Up till now the production of cotton crop is satisfactory in Sindh & Punjab. The price of local cotton remained stable in this week due to the downward trend of NYCF but it seems that local cotton prices will increase in coming days. The Karachi Cotton Association (KCA) spot rate (2019-2020) increased Rs.50 and closed at level of 8350 per maund.
- Sowing of cotton has completed in the provinces. It is expected that 80 lac bales will be produced in Punjab, while the production of cotton is expected to be in between 42 to 44 lac bales in Sindh. It is expected that production of cotton will be one and a half lac in Balochistan and Khyber Pakhtunkhwa. Overall production of cotton is expected to be approximately one crore 25 lac bales.
- In the international cotton market, a lower trend has been seen. The reason behind low cotton prices in America is increase in the production of cotton and on the other hand the export of cotton is less than expectations. There was no dealing of cotton between the China and America due to their longstanding trade conflict which is not going to be solved. The rate of cotton is stable in China. India cotton is lesser then their targets but still due to international trend Indian cotton didn’t show any increase in prices.
- Prices of seed cotton (Kapas/Phutti) for the new crop (2019-2020) in Sindh were in range from Rs 3700 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 higher level on Monday as compare to previous week’s closing figures.
- NYCF dropped throughout the week, while recovered slightly on closing, hence closed on negative side by the end of the week.
At last day of the week, OCT 2019 closed at 62.25 with decrease of 145 points.
At last day of the week, DEC 2019 closed at 63.07 with drop of 88 points.
At last day of the week, MAR 2020 closed at 63.98 with lower of 102 points.
|Closing of NYCF’s|
|Oct 19||62.25 cents / lb||-1.45 cents/lb|
|Dec 19||63.07 cents / lb||-0.88 cents/lb|
|Mar 20||63.98 cents / lb||-1.02 cents/lb|
A was opened at 74.05 with lower level from previous week’s closing figure.
- In this week Index “A” dropped in next session later took upward jump, in last sessions showed again downward trend and at the end closed on negative side.
- At last day of the week, LPI “A” closed at 73.70 with decrease of 35 points as of opening figure of the week.
Crude Oil prices opened at USD 59.58 with slightly lower level as compared to last week closing figures.
- In this week, crude oil prices showed downward trend in whole week and closed on negative side at the end of week.
- In last day of the week, Crude Oil price closed at USD 55.63 with decrease of USD3.95 cents as of opening figure of week.
Pakistan Currency Exchange Rates
- In last week values of Pak rupee apricated 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 negative note with figure of 1.12 and British Pound also closed on negative note with figure 1.25 against USD.
|Exchange Rates USD.|
- Local yarn market remains under sale pressure and only limited counts sale finalized during the previous week ended. Mills were offering prompt delivery and some discounts in rates against cash payments. On the other hand, weavers were waiting for some more correction in prices and were buying their urgent needed yarn only.
- PSF price remained stable during this week ended in domestic market. PTA, MEG and Crude oil prices were stable and soft in the international market, and China’s import fiber price dropped by end of last week. It is expected price for fiber in domestic market will remain stable for this week.
- Faisalabad trading market remained close in terms of sale and no yarn buying reported from mill. All spinning mills were waiting for the new Tax issue to get resolved hence no sale was made. Faisalabad based units cut their production and are trying to sell in registered sector for some counts.
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 nominal business activity with firm and stable price sentiments. Over all customers kept on checking prices and good numbers of enquiries were received. In response to that, order confirmations remained slow due to pressure on cotton prices all over the globe after news of healthy production this year. Customers are bidding on lower side considering decline in prices in days to come. Hence, they are not showing interest to increase their prices. We might see good business activity from China and other markets in days to come. HK customers remained silent and no such activity has been witnessed. European customers floated limited enquiries. It is expected that there will be handsome activity from European market in days to come as they might place good numbers of orders before going on holidays.
- The local fabric market got a ray of hope after consective dull couple of weeks and in current week under review the weavers received improved flow of inquiries and also matured business deals with their local customers at last week price levels for both narrow and wider width fabric markets.
- Weavers extended their booking and now narrow width looms are booked till end August and wider width looms are booked till end September 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.
- Good trading activity was seen from Far eastern market as customers have taken interest in fresh buying. Korea, China, Japan, Bangladesh and Sri Lankan markets were active as well and have bought decent quantities from their selected suppliers. Vietnam, Thailand, Indonesian markets were comparatively slow.
- Prices were stable during the week. Good suppliers are booked till end of Aug and offering early ~ mid Sep onward deliveries whereas average suppliers are booked till mid of Aug and offering end Aug onward deliveries. It is forecasted that market activity may remain mixed with limited buying in coming days.
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.
- Active buying has been noticed from Germany, Portugal and Italy both in narrow and wider width fabric. There is good demand in wider width fabric due to which some of the customers are facing required delivery problem.
- Good suppliers are good till end of Oct and offering Nov onward deliveries. Some of the suppliers have early ~ mid Oct deliveries available however they are offering limited quantities.
- USA market is responding well now a days as customers have good demand in narrow and wider width fabric hence booking their required items with their selected suppliers. Suppliers are expecting good demand from Europe and USA in days to come.
Bed Linen & Towels:
- Home textile market had remained firm in the last week. Customer have floated few inquiries in the market & maturity of business has remained firm.
- The USA Market was also firm in last week and customers floated few inquiries and orders did materialize in handsome volumes whereas the European market have remained firm as well.
- keeping in view current market situation it seems that prices will be remain at current levels in upcoming weeks. As far as shipments are concerned supplier are offering 60 to 70 days for new orders & for repeat orders supplier are offering 50 to 60 days.
- Pakistan’s knitwear apparel textile has shown a significant growth, as knitted garments’ export during first 10 months of the financial year from July 2018 to April 2019 has registered an increase of 8.76 percent to $ 2.39 billion against $ 2.20 billion of the same period of last year.
- According to the latest data, export of woven garments was $ 2.18 billion showing an increase of 3.21 percent over the corresponding period last year. Value-added sector achieved growth because of preferential access to the 28-nation European Union under the GSP+ scheme which can further be enhanced with the government’s support.
- Garment industry is less capital intensive, provides 4 times as many jobs for the same investment, uses less energy and adds more value. Pakistani factories have found out the dynamics of competitive advantages and utilizing them effectively to get the best business volumes in the global markets. Factories are offering sixty to ninety days lead time according to their available capacities and as per design of the garment.
- In Local Yarn market it is expected that yarn market will come under sale pressure due to slow buying mood from the buyer and price will get stable after some correction or the bulk cotton arrival will determine the price for the next season. Further price trends of yarn will be according to demand and supply of different counts which will lead the price level.
- In Export Yarn overall the market remained firm and stable with limited business activity. Prices are expected to remain firm as it seems that prices have already touched bottom levels. Good business activity is expected in days to come.
- In Local Fabric Market, technically speaking market may move range bound due to coming cotton season and also limited market activity.
- In Export Fabric Market good trading activity has been observed from Fareastern markets with decent quantities. European and USA markets are active as they are buying good quantities both in narrow and wider width fabric.
- Bedlinen and Towels market has remained firm, keeping in view current market scenario it seems that the business will be further improve if prices remain stable.
- A growth in apparel industry of Pakistan has been observed despite the pessimism being observed by the overall textile sector due to current government’s policies.