PAKISTAN COTTON MARKET:
In Last week, improved business activity was seen, buyers and spinners showed interest in buying under the influence of bullish trend in the international market as well as due to drastic decrease in the production of cotton. The business to some extent was satisfactorily however in first three days of the week the business remained low.
Due to threat of second wave of COVID 19 textile mills were involved in limited buying. The millers were indecisive and they were hesitant to buy cotton in large quantity due to the looming threat of COVID 19. On the other hand big textile groups had a little bit decreased the import of cotton because of the increasing rate of dollar. However, textile mills up till now had signed agreements for the import of three million bales. It is estimated that 7 million bales of worth 4 billion dollars will have to be imported from abroad due to the low cotton production in the country.
Price of cotton increased Rs. 200 to Rs. 300 per maund. The price of Phutti is also increasing. The price of good quality cotton was in range of Rs. 8800~9600. KCA remained stable at the level of Rs. 9,300/maund.
Mixed trend was seen in international cotton market. The fluctuation was seen in the market after coming of the successful testing of COVID19 vaccine. On the other hand, as per weekly export report of New York Cotton decline of 45% was witnessed in exports as compared to last week.
This week Pakistan was the biggest buyer after Vietnam. On the other hand the markets of Brazil, Argentina and Central Asian states remained stable while bullish trend was witnessed in Indian cotton market. The reason behind bullish trend in Indian cotton market is buying by Indian textile mills. Cotton Cooperation of India is also continuously involved in buying. According to the sources the new cotton crop has started arriving in India. Up till now around 4 million bales of cotton has arrived out of which CCI has bought 15 to 16 lac bales. The CCI had already the stock of 5 million bales.
The statistics released by Pakistan Cotton Ginners Association till November 15 shows an alarming decline of 2.8 million bales which is 41.47 % less as compared to more than 6.8 million bales produced till November 15 last year. The price of cotton in Sindh is in between Rs. 8600 to Rs. 9400 per maund. The price of Phutti in Sindh is in between Rs. 3700 to Rs. 4600 per 40 kg. The price of cotton in Punjab is in between Rs. 8800 to Rs. 9600 per maund. the price of Phutti in Punjab is in between Rs. 3900 to 4700 per 40 kgs. The price of Phutti in Overall prices of cotton were in the range of USC 65~73 Lbs. (8600~9600/ maund).
| Opening Of the Week | Closing Of the Week | Change | |
| Lowest | 65.00 | 65.00 | 0.00 |
| Highest | 72.00 | 72.00 | 0.00 |
CRUDE OIL:
Crude Oil prices opened at USD 41.34 with high level as compared to last week closing figures.
In this week, crude oil price showed upward trend , while dropped in one session but positive trend was witnessed, therefore closed on positive side at the end of week.
In last day of the week, Crude Oil price closed at USD 42.15 with increase of USD 0.81 cents as of opening figure of week.
| Opening of Week | Closing Of Week | Change | |
| Price | 41.34 | 42.15 | 0.81 |
EXCHANGE RATE:
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 1.19 and British Pound also closed on positive note with figure 1.33 against USD.
| Selling | Buying | |
| LC Sight | 160.48 | 160.43 |
| LC 120 Days | 159.90 | 159.85 |
| Open Market | 162.51 | 158.80 |
NEW YORK COTTON FUTURE:
New York Cotton futures opened on higher levels on Monday as compare to previous week’s closing figures.
NYCF showed mix sentiment in this week, hence closed on positive side by the end of week.
At last day of the week, MAR 2021 closed at 72.96 with upward of 138 points.
At last day of the week, MAY 2021 closed at 73.79 with rose of 133 point.
At last day of the week, JUL 2021 closed at 74.40 with increase of 128 point.
PAKISTAN YARN MARKET:
Local market remained Quite another week in a row with limited activity. All weavers were waiting for correction after NYC, crude Oil, US$ and local cotton dropped. On the other hand, suppliers were interested to extend their sale booking on these rates as yet they don’t have stocks sales/pressure.
PSF prices was remained stable during last week ended. PTA, MEG prices were stable after stable prices of crude oil in international market and same followed by International polyester fiber. For next week, prices are expected to remains stable.
Faisalabad trading market was slow in buying and limited trade was made in all counts of cotton yarn. Blended yarn was also in average demand, and limited sale was reported in all counts.
Following are current asking prices of yarn in local market based on ex mills:
| Count | Price US$/Bale |
| 16/1 CD | 470 – 485 |
| 20/1 CD | 495 – 515 |
| 30/1 CD | 545 – 570 |
| 20/1 CM | 560 – 575 |
| 30/1 PC 52:48 | 425 – 445 |
| 40/1 CM | 680 – 705 |
| 60/1 CM | 950 – 980 |
| 80/1 CM | 1225 – 1315 |
EXPORT YARN MARKET:
Export yarn market showed improved business activity as customers from all regions remained in market.
There has been another surge in price as spinners increased their asking price due to good demand. Customers were silent since last 2 weeks which was putting pressure on suppliers but this week, they have showed very good activity and booked handsome quantity orders.
This has given confidence to spinners and they have increased their asking prices once again by 2-3%.
Despite of increased in prices, customers have placed handsome quantity orders with their selected suppliers.
Suppliers are comfortably booked till mid-January and offering onward deliveries.
We might see firm and stable market in days to come with slight fluctuation in prices both side. Chinese customers remained in market and placed handsome quantity orders this week which pushed prices once again on higher side. European customers kept on checking prices for normal as well as specialized yarns. However, order materialization was slow.
| Count | Korea | Hong Kong | Taiwan | Japan |
| 16/1 CD | 460 – 470 | 460 – 470 | 460 – 470 | 460 – 470 |
| 20/1 CD | 480 – 490 | 480 – 490 | 480 – 490 | 480 – 490 |
| 20/1 CM | 535 – 545 | 535 – 545 | 535 – 545 | 535 – 545 |
| 30/1 CD | – | – | – | – |
| 32/1 CD HOS UNWAXED 100% COT. | – | – | – | – |
| 30/1 CM | 555 – 565 | 555 – 565 | 555 – 565 | 555 – 565 |
| 32/1 CM | 575 – 585 | 575 – 585 | 575 – 585 | 575 – 585 |
| 24/2 CD | 545 – 555 | 545 – 555 | 545 – 555 | 545 – 555 |
PAKISTAN FABRIC MARKET:
The local fabric market remained dull till mid of the week but towards the end of the week market turned alive for both narrow and wider width fabrics. Weavers floated bulk inquiries in the market towards the end of the week and shared bids though at approx 6~8% lower than asking prices of the weavers.
Therefore, resultantly limited activity observed in the market for both narrow and wider width fabrics.
Weavers are very firm to book orders at their desired inflows only as they are not feeling any pressure and have comfortable booking in hand.
Weavers are comfortably booked in narrow width till end december’20/early January’21 and in wider width they have booking in hand till end January ~ early February’21 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 | 1.20 – 1.22 |
| 16X12/108X56 63″ 3/1 | 1.30 – 1.32 |
| 20CDX20CD/108X58 63″ 3/1 ”S” TWILL PAK CTN | 0.98 – 1.00 |
EXPORT FABRIC MARKET:
Export fabric markets remained slow during the week as customers were waiting to settle down the prices. Inquiries flow was good from China, Korea, Bangladesh and Japan however limited buying was witnessed for urgent orders. Customers are holding their bulk orders for some time to understand the market sentiments.
Asking prices were stable without any major change due to stable raw material prices.
Pak rupee loss 1.50% against US. Dollar hence the yarn prices also increased a little but it compensated the exchange rate thus the fabric prices were same as per last week.
Currently good suppliers are booked till end of Jan and offering early Feb onward deliveries.
Good flow of inquiries was received from Germany, Italy and Portugal hence limited buying was witnessed both in narrow and wider width. Prices for wider with was stable during the week. Good suppliers are booked till end of Feb and offering March onward deliveries however some suppliers have space for mid ~ end Feb deliveries. USA market was slow without any major business activity.
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 | 1.20 – 1.22 |
| 16X12/108X56 63″ 3/1 | 1.32 – 1.34 |
| 20CDX20CD/108X58 63″ 3/1 ”S” TWILL PAK CTN | 1.00 – 1.02 |
BED LINEN & TOWELS:
Bedding & Towels manufacturers are operating at their maximum capacity with loom availability being very tight and looms are booked till January 2021. This has resulted in prices staying firm even drop in prices of cotton and yarn have only got reduction of 2-3% prices in end product, now factories are ready to negotiate on prices for next year bookings as all Holiday season order placed and also orders started to ship.
Due to current Covid situation market is bit slow as most countries are going for Lockdown, in addition Australian market is gradually opening after 4 months lockdown and there is good amount of inquiries floating in market.
Basic to higher thread counts such as T144 to T200 are mainly in demand but the supply of 30s and 40s yarn is not able to keep up with the demand due to shortage of cotton crop and polyester fiber being on the higher side.
GARMENTS:
Garment Industry of Pakistan is sailing through its smooth journey as for orders in hand. Healthy placements were observed in recent past. Developments for FW21 season are in progress. On the global front UK retailers were found to observe a sales growth in October for a sixth consecutive month. However, at the same time clothing was one of the only two sectors with sales volumes still down on their pre-pandemic levels. Factories in Pakistan are offering lead time ranging from ninety days to one hundred and twenty days depending upon the production space and types of the inquired articles.
Sustainability remains and important aspect for brands for future placements. H&M has signed an agreement with Renewcell (Textile recycling company based in Sweden) which will see the Textile recycling company supply with its pioneering virgin quality Circulose fibers made from unusable textile waste.
GOING FORWARD:
In the local cotton market, comparatively improved business was seen, increased in international prices drove the local market as well. It seems that prices will remain firm to upward in some extend due to the shortage of the crop.
About future market of Local yarn, it is expected that domestic yarn market will be remains same for next week due to shortage of raw cotton. Further price trends will be according to demand and supply of different counts which will lead price level.
Export yarn market will remain firm and stable with tendency to improve further if demand showed further surge. Suppliers are under comfortable zone and not showing any panic selling.
Good business activity was seen in domestic fabric market towards end of the week however target and offering price difference is about 6~8%. It is expected that business activity will remain good in coming days with low target prices by the customers.
Export fabric business activity will remain good in days to come and prices will remain stable.
For Home Textile, we are hoping for the prices to drop with settlement of many factors in the coming months and with supply side stabilizing and deliveries easing out the order turnaround will be good.
An optimistic outcome is expected for the garment industry of Pakistan as for further order placements. Effects of second wave of Covid-19 are still unclear as for business placement. Sustainability remains and important aspect for brands. Lead times are being offered from ninety days to hundred and twenty days.
