Local Cotton Highlights:
- In the local cotton market, during the last week, slow buying activity has been observed as buyers were reluctant to buy due to the high moisture issues, as heavy rains were observed over cotton belt. Stagnant rain water in the fields has led to slight damage of the crops. Shortage of transportation was also an issue due to the religious official holidays.
- It seems that market activity will revive after the official holidays during this week and buyers will show interest in making new deals. Arrival will also improve and quality lint may become easily available.
- The prices of cotton remained firm at the same levels due to the moderate activity, while it was observed that ginners raised their asking of quality lint because of the damaged crop. In international market NYCF showed firm to steady trends. The Karachi Cotton Association (KCA) spot rate (2019-2020) increased to Rs. 100 and touched the level of 8100 per maund. The prices of cotton remained stable in China but the bearish trend was seen in India. The China and America trade conflict is not only affecting the trade activities of these two countries but the trade activities of many countries are affected due to their conflict.
- PCGA issued arrival report on 1st September,2019 and showing arrival of 1.355 million bales. Cotton production in Punjab stood at 375,813 bales and in Sindh at 979,897 bales. Around 28,558 bales were lying unsold in Punjab from the new season and 21,838 bales in Sindh. In total 178,002 unsold bales are presently with ginners.
- Prices of seed cotton (Kapas/Phutti) for the new crop (2019-2020) in Sindh were in range from Rs 3500 to Rs 3800 per 40 Kgs and new crop phutti is available from Sindh in range from Rs 7750 to Rs 8400 per maund (37.32 Kgs).
- In Punjab prices of seed cotton was in range from Rs 3600 to Rs 3900 per 40 Kgs and new crop phutti is available from Punjab in range from Rs 7850 to Rs 8610 per maund (37.32 Kgs). Overall deals were made between the range of USC 60~67 Lbs. (7,750~8,615/ maund).
New York Cotton Futures:
- New York Cotton futures opened on lower levels on Monday as compare to previous week’s closing figures.
- NYCF showed mix trend in this week and closed on positive side by the end of the week.
At last day of the week, OCT 2019 closed at 58.73 with decrease of 12 points.
At last day of the week, DEC 2019 closed at 58.58 with increase of 56 points.
At last day of the week, MAR 2020 closed at 59.31 with rose of 53 points.
|Closing of NYCF’s|
|Oct 19||58.73 cents / lb||-0.12 cents/lb|
|Dec 19||58.58 cents / lb||+0.56 cents/lb|
|Mar 20||59.31 cents / lb||+0.53 cents/lb|
A was opened at 70.35 with same level from previous week’s closing figure.
- In this week Index “A” showed mix trend hence closed on negative side.
- At last day of the week, LPI “A” closed at 69.65 with decrease of 70 points as of opening figure of the week.
Crude Oil prices opened at USD 55.10 with same level as compared to last week closing figures.
- In this week, crude oil price dropped in next session, while later marched on higher side and closed on positive side at the end of week.
- In last day of the week, Crude Oil price closed at USD 56.52 with increase of USD 1.42 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 positive note with figure of 1.11 and British Pound also closed on positive note with figure 1.23 against USD.
|Exchange Rates USD.|
- Local yarn market remained stable in term of asking prices and slow in term of sale finalization. Only limited sales were made on buyer prices with limited quantities. Sellers were interested in more sales but were resisting on prices on the demanded levels. On the other hand, weavers booked only urgently needed yarns. No projection-based booking was reported in market.
- PSF price dropped by Rs.2/kg in domestic market dated 2nd Sep, 2019. Import fiber polyester dropped in international market which caused a drop of local fiber prices. PTA, MEG prices remained stable during the week, crude oil graph in International market also remained stable for this week. For next week it is also expected that price will remain stable in local market.
- Faisalabad trading market remained close in terms of sale and no yarn buying reported from mill in un registered sector. Some exporter made good trade in 31/1pc and delivery remained short and prices also jumped up in specific count due to good demand in market. Faisalabad based supplier have started shifted their production to registered sector.
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||410 to 430 per bale|
|20/1 CD||425 to 450 per bale|
|30/1 CD||480 to 505 per bale|
|20/1 CM||505 to 520 per bale|
|30/1 PC 52:48||395 to 430 per bale|
|40/1 CM||590 to 610 per bale|
|60/1 CM||900 to 925 per bale|
|80/1 CM||1185 to 1310 per bale|
- Market remained under lackluster business activity with a quite tone. Suppliers are interested to sell and trying to get orders. It has been noticed that cotton market has shown slight improvement in activity. Hence, mills are becoming hopeful that business activity may pick up in days to come.
- Moreover, positive news regarding positive trade talks between US-China is also putting impact on market.
- European customers started sharing enquiries after coming back from holidays. However, orders materialization is limited and we might see improved business activity in days to come. Korean customers remained silent and no enquiry was received. HK customers just floated few enquiries for price checking but no order was reported. Chinese customers remained in the market and kept of floating enquiries. Few deals were reported where suppliers matched customer required prices. However, it seems business activity will pick up in weeks to come as customers are showing interest and orders will be confirmed in days to come.
- The local fabric market moving in narrow range and closed on firm note for both narrow wider width looms. Weavers received limited inquiries from their buyers and limited business reported in the market for both narrow and wider width fabric markets. Weavers offered prices at same level however ready to negotiate to some extent.
- Weavers booked their narrow width looms till early October while wider width looms are covered till early November’19 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.
- Far Eastern markets are still showing slow response as limited inquiries were exchanged during the week resultant limited buying. Limited inquiries were received from China, Korea, Vietnam and Japan with limited buying during the week. Asking prices remained stable due to stable raw material prices.
- Good suppliers are booked till mid of Oct and offering end Oct onward deliveries. Average suppliers are offering early Oct onward deliveries. More active trading activity is expected to start after mid of Sep.
Following were the closing rates based on CNF Far Eastern ports.
20×16/128×60=63”, in range of 1.08 to 1.10 per yd, 16×12/108×56=63” between USD 1.17 to 1.19 per yd and 20×20/108×5863” in range of USD 0.88 to 0.90 per yd based on CNF Far Eastern ports.
- Some of the European customers are back after their holidays and started sharing their requirement however no considerable business was witnessed during the week. Good flow of inquiry was observed from USA market mainly in wider width and bulk orders are under discussion which may finalize during next week.
- Wider width suppliers have good sales coverage as they are booked till end of Oct / mid Nov and offering end Nov onward deliveries. Wider width suppliers are normally offering end Nov onward deliveries. Limited quantities are available with few suppliers for end Oct deliveries. Prices for wider width remain stable without any major change. Healthy activity is expected to start after mid of Sep onward.
Bedding & Towels:
- Home textile market was slightly active in the last week in terms of receiving new inquiries and order placements. European and other sector customers floated goods inquiries in the market & maturity of business was good as compared to the last two or three weeks. USA Market, customers floated good inquiries and business maturity was nominal in terms of order placement.
- Customers have started to place new orders for Bedding and Towels. Jersey bedding is also hot selling article these days and customer are placing good orders in Plain dyed, Printed and in different dyeing techniques like cross dyed or marle effects.
- 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.
- The textile and garment sectors are important components of the country’s manufacturing industry. The garment and textile sector contributes up to 8.5 percent of Pakistan’s GDP and about seventy percent of total exports.
- From the policy making side, Punjab Government has decided to establish a ready-made garment cluster in Lahore where fashion studio will also be set up. This project is will play an important role in promoting social and economic activities. Besides it would be a source of enhancing export and creating employment opportunities.
- Garment factories have season’s orders in hand till November on average and offering December onward deliveries depending upon the type of the garment.
- In Local Yarn Market it is expected that the market will be remain stable, and price will be remaining same with minor difference and business will be according to the demand of count to count and brand to brand in market. Further bulk cotton arrival will determine the price of raw material for next season and price trends of yarn will be according to demand and supply of different counts which will lead price level.
- The Export Yarn Market remained under limited business activity. However, we might see business activity with improvements as customers are showing good interest and demand is increasing.
- In Local Fabric Market in continuation of our last forecast slow sentiments may continue for coming weeks for both narrow and wider width fabric markets.
- In Export Fabric Market on Far Eastern side, they are still not active with limited activity being observed. European customers are back and started sharing their inquiries. USA market responded well during the week and expecting good activity after mid of Sep.
- In Home Textiles the market is better and as per forecast market will remain stable in coming days and customers will be buying more keeping in view their future requirements.
- Growth in the export of garments is likely to accelerate given the emerging opportunities and the support from the government in terms of import policies and custom reforms.