Local Cotton Highlights:
- During the last week, In the local cotton market, cautious buying was seen by textile and spinning sectors while the ginners has increased the selling because the stocking of cotton becomes very expensive. So overall trading volume was renamed moderate. Although the quality of local cotton is not good but the mills will buy the local cotton for mixing.
- The prices of cotton remained stable overall and no major fluctuation was observed. The Spot Rate was remained same and firm at the level of Rs 8750. According to the weekly USDA weekly report the export of American cotton witnessed a decrease of 10 percent. However, due to the chances of increasing of Chinese interest in American cotton the rate of American cotton increased while the rate of cotton in China remained stable.
- Due to the crisis like situation in Indian textile sector the demand of cotton decreased in India as a result of which rate of cotton witnessed a prominent decrease. The second reason is that due to the ban on the trade between India and Pakistan the stock of cotton is in abundant quantity. The rate of Shankar 6 cotton was reached at the highest level of Rs 46000 per Candy was decreased by Rs 7000 and reached at lowest level of Rs 39200 per Candy.
- Pakistan Cotton Ginners Association has issued the statistics of cotton production till December 15 according to which 7.86 million bales are produced which is 21 percent less as compared to last year’s production of 9.96 million bales. It seems that that this year total cotton production will be 85~90 lac bales while the textile sector of the country needs 1 crore 50 lac bales. Industry will have to import 60 lac bales in order to fulfill their demand. According to the importer’s contracts for the import of 40 lac bales from abroad were already signed.
- It seems that activity will remain moderate in a day to come and no major changer are expected in term of prices.
- Prices of seed cotton (Kapas/Phutti) in Sindh were in range from Rs 3200 to Rs 4000 per 40 Kgs and cotton is available from Sindh in range from Rs 7800 to Rs 8900 per maund (37.32 Kgs). In Punjab prices of seed cotton was in range from Rs 3300 to Rs 4200 per 40 Kgs and cotton is available from Punjab in range from Rs 8000 to Rs 9050 per maund (37.32 Kgs). In Balochistan, seed cotton prices were in range of Rs 4200-4400.Overall deals were made between the range of USC 62~71 Lbs. (7800~9,050/ maund).
New York Cotton Futures:
- New York Cotton futures opened on higher levels on Monday as compare to previous week’s closing figures.
- NYCF showed mix trend in this week and at the end closed on positive side.
At last day of the week, MAR 2020 closed at 67.96 with increase of 99 points.
At last day of the week, MAY 2020 closed at 69.00 with rose of 87 points.
At last day of the week, JULY 2020 closed at 69.66 with upsurge of 67 points.
|Opening Of the Week||Closing Of the Week||Difference|
A was opened at 76.40 with higher level from previous week’s closing figure.
- In this week Index “A” showed mix trend in this week and closed on negative side.
- At last day of the week, LPI “A” closed at 75.90 with decrease of 50 points as of opening figure of the week.
Crude Oil prices opened at USD 60.21 with slightly higher level as compared to last week closing figures.
- In this week, crude oil price showed mix trend and closed on positive side at the end of week.
- In last day of the week, Crude Oil price closed at USD 60.44 with increase of USD 0.23 cents as of opening figure of week.
Pakistan Currency Exchange Rates
- In last week values of Pak rupee improved slightly 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 1.11 and British Pound closed on negative note with figure 1.30 against USD.
|LC 120 Days||147.89||147.84|
- Local yarn market moved up by R.3~4/lbs during this week ended in term of asking prices. Good enquires were floated in market and reasonable business finalized. Coarse count activity also improved and some sale pressure released from mill by making good sale in export to china market. Weavers were ready to buy on their target and they covered reasonable yarn as per their requirement.
- PSF prices increased Rs.2/kg by 16th December 2019. In China PSF price was increased by end of this week and internationally crude oil prices also were in stable trend and prices increased in raw material PTA and MEG by end of this week. For next week it is expected that price will remain stable for PSF in domestic market.
- Faisalabad trading market reported average business activity. Some fine counts trade was made during this week ended. Exporter and register mills were also busy in their regular buying. Fine counts demand was there and reasonable activity was reported. Blended yarn demand reported very average in term of business finalization.
Following are current asking prices of yarn in local market based on ex mills:
|16/1 CD||430.00 – 450.00|
|20/1 CD||445.00 – 475.00|
|30/1 CD||505.00 – 535.00|
|20/1 CM||520.00 – 530.00|
|30/1 PC 52:48||415.00 – 445.00|
|40/1 CM||625.00 – 655.00|
|60/1 CM||885.00 – 925.00|
|80/1 CM||1205.00 – 1320.00|
- Market remained under nominal business activity due to high asking prices and handsome booking in last couple of weeks. Customers remained under wait and see mode and kept on checking prices in market. Over all prices trend was stable with slight increase. Suppliers remained in market to sale their Jan and Feb portions. It has been witnessed that customers have placed orders with increased prices of 1-2% in last couple of weeks but further increase is not acceptable.
- We might see good business activity in days to come as well. Korean customers remained silent and no such business activity was witnessed. HK customers also remained slow and limited numbers of enquiries were floated against which order materialization was dull as well. Chinese customers kept on checking prices but no big business activity was witnessed. Customers are now under wait and see mode due to hike in prices by suppliers are waiting for prices to be reasonable before market they place new order.
- European customers floated limited numbers of enquiries. It seems that buying from European customers will pick up after holidays now as all customers already left for holidays.
|16/1 CD||440 – 450||450 – 450||440 – 450||440 – 450|
|20/1 CD||450 – 460||460 – 460||450 – 460||450 – 460|
|20/1 CM||505 – 510||510 – 510||505 – 510||505 – 510|
|30/1 CD||505 – 510||510 – 510||505 – 510||505 – 510|
|32/1 CD HOS UNWAXED 100% COT.||510 – 520||520 – 520||510 – 520||510 – 520|
|30/1 CM||560 – 570||570 – 570||560 – 570||560 – 570|
|32/1 CM||555 – 565||565 – 565||555 – 565||–|
- In current week under review improved activity reported in the local fabric market for both narrow and wider width fabrics.
- Buyers floated inquiries with increased flow however orders confirmed at increased prices by approximately by 1% as compared to last week.
- Weavers increased their asking prices for narrow and wider width fabrics due to increase in yarn prices and extended their booking level for another week.
- In narrow width weavers are booked till 3rd week January ~ End January’2020 and wider width normal looms are booked till end February whereas special looms are booked till mid-March and offering onward deliveries.
Local fabric prices of regular items are as follows:
|Construction||Price US$/YD ExMill|
|20CDX16CD/128X60 – 63″ 3/1 ”S” TWILL PAK CTN||1.08 – 1.10|
|16X12/108X56 63″ 3/1||1.18 – 1.20|
|20CDX20CD/108X58 63″ 3/1 ”S” TWILL PAK CTN||0.90 – 0.92|
- Export fabric in fareastern and Asian markets is not going well due to slow demand from end customers. Few inquiries were received from Korea, China, Japan and Vietnam resultant limited buying during the week.
- Good quantity of orders was placed by Bangladesh customers at very competitive prices. Supplier asking prices were increased about 2% due to increase in raw material prices which were about 3~4% whereas customers were insisting to get previous prices which suppliers could not manage hence some of the orders are still at hold.
- Currently good suppliers are booked till early of Feb and offering mid Feb onward deliveries whereas average suppliers are booked till mid of Jan and offering end Jan onward deliveries. It is expected that business activity may remain slow in coming days due to end of year and holiday mood.
Following were the closing rates based on CNF Far Eastern ports.
|Construction||Price US$/YD CNF Far East|
|20CDX16CD/128X60 – 63″ 3/1 ”S” TWILL PAK CTN||1.12 – 1.14|
|16X12/108X56 63″ 3/1||1.20 – 1.22|
|20CDX20CD/108X58 63″ 3/1 ”S” TWILL PAK CTN||0.93 – 0.95|
- There was good flow of inquiries from most part of the Europe as customers were mainly checking prices before going to their holidays. Decent quantity of orders was booked by Portugal, Italy and Spanish customers. Other markets like Belgium and France remained slow during the week under review.
- Wider width suppliers are in very comfortable zone due to good order position. Their prices were also increased about 2~3% due to hike in yarn prices. Currently wider width supplier is booked till end of Feb and offering March onward deliveries. Suppliers are now preparing themselves for upcoming Heimtex fair held in Germany during first week of Jan with great hope to have good orders in their basket.
- USA market remained mixed with limited business activity during the week. It is expected that business may remain dull and negligible in next few weeks due to holiday season.
Bedding & Towels:
- Home textile market remained slow in last week and business activity was limited in terms of orders placement. USA Market remained slow in last week, limited inquiries observed in market and order placement was limited. European markets buying was slow. Customers placed limited orders which they need on urgent basis. As per forecast market will remain slow till the mid-January due to upcoming Heimtex fair 2020.
- Prices were almost stable and not observed any significant change in current price levels even so yarn prices increased 1 to 2% but supplier did not increase their prices. keeping in view current market situation it looks that prices will remain stable in upcoming days and customers will place the orders after Heim textile fair 2020.
- Suppliers have orders up to February, 2020 but still they are under sales pressure to fulfill their capacities 100% after February & they are trying get more orders from different customers / markets, even to full fill their capacities suppliers are offering very sharp prices to capture bulk orders. As far as shipments are concerned supplier is offering 80 to 90 days for new orders & for repeat orders supplier are offering 6o to 65 days.
- Holiday mood persisted in terms of order finalization prior to New Year and Christmas Holidays. At the same time factories were running at their full capacities for the orders already in hand. Lead time is being offered from eighty to ninety days.
- Pakistan has witnessed an evolution in Garment industry as we have observed that industrialists who were initially engaged in spinning or weaving have ventured into Finished Garment Production as they have realized that profitability builds up with each process.
- An increase in new customers have been seen from Europe and United States. The Garment industry is accepting a tremendous growth in their business as they have proven to the Global customers that challenges of timely delivery and quality products can be met from and sustained in Pakistan.
- About future market it is expected that domestic yarn market will be remains stable for next week due to firm prices of raw material. Further price trends will be according to demand and supply of different counts which will lead price level.
- Market remained under average business activity. It is expected that market will show slight slow business activity in weeks to come due to holidays in most of the regions.
- Slow market sentiments may continue for both narrow and wider width looms for coming weeks due to upcoming textile fair.
- Fareastern and Asian markets remained mixed and expected to remain slow in coming days due to year ending closing and slow demand. European customers booked good quantities during the week however next week for Europe and USA markets are expected to remain slow due to holidays.
- Overall Business activities were limited but current market Statics showing business will grow in upcoming weeks and customers will place their major orders for 2020 sales.
- Overall Pakistan’s garment industry is flourishing with a bright future and factories are working on their full capacities.