PAKISTAN COTTON MARKET
Last week in local cotton market, moderate buying was seen by buyers and trading volume was very low, due to the increase in prices mills were involved in cautious buying. Ginners were also on careful selling in anticipation of good profit margins in coming days.
In local cotton market, cotton prices were remained stable at the level of Rs 11500 per maund. KCA increased rs.100 and touched the level of rs.11,100/maund. Local volume was decreased because mills were involved in buying of importing cotton from abroad, big textile groups had signed agreements for the import of cotton from abroad in very large number.
In the international cotton markets over all bullish trend was witnessed Now the price has increased in international cotton market due to which more imports are being made cautiously. Meanwhile, cotton prices rose to the highest in two-and-a-half years, supported by a weaker US dollar and strong demand for the natural fibre, while investors awaited federal exports sales numbers. For the last many days in the international cotton markets, the increasing trend in demand and rate prevails. The price of New York Cotton has reached at the highest level of 91 cent and it is hinted that it will increase more. Moreover, according to USDA weekly export report exports decreased by 57 % as compared to last week but this week China is the biggest importer despite holidays in China.
According to the fortnightly report released by Pakistan Cotton Ginners Association till February 15 , 5.6 million or exactly 56,16,623 bales have reached ginning factories across the country, registering a 34.29 per cent shortfall compared to corresponding period of last year when arrivals were recorded over 8.5 million bales. Cotton arrivals in Punjab were recorded at 3,480,454 bales registering a shortfall of 31.41% as compared to corresponding period of last year. Sindh generated just over 2.1 million bales registering a shortfall of 38.53%. Bahawalnagar district of Punjab topped with cotton arrival figure of 987,807 bales followed by Sanghar district with 791,278 bales. This year’s cotton production in the country is at an alarming level which is less than the production of the last thirty years.
The price of cotton in Sindh is in between Rs 10,400 to Rs 11,200 per maund. The price of Phutti in Sindh is in between Rs 4000 to Rs 4800 per 40 kg. The price of cotton in Punjab is in between Rs 10,600 to Rs 11,500 per maund. The price of Phutti in Punjab is in between Rs 4500 to 5300 per 40 kgs. The price of Phutti in Overall prices of cotton were in the range of USC 79~87 Lbs. (10400~11500/ maund).
|Opening Of the Week||Closing Of the Week||Change|
Crude Oil prices opened at USD 60.05 with high level as compared to last week closing figures.
In this week, crude oil prices rose in next session, later showed downward trend till closing and closed on negative side at the end of week.
In last day of the week, Crude Oil price closed at USD 59.24 with decrease of USD 0.81 cents as of opening figure of week.
|Opening of Week||Closing Of Week||Change|
In last week values of Pak rupee fluctuated 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 1.21 and British Pound closed on positive note with figure 1.40 against USD.
|LC 120 Days||158.60||158.55|
NEW YORK COTTON FUTURE
New York Cotton futures opened with higher levels on Monday as compare to previous week’s closing figures.
NYCF showed upward trend in this week and closed on positive side at the end of week.
At last day of the week, MAR 2021 closed at 88.95 with upward of 83 points.
At last day of the week, MAY 2021 closed at 90.48 with rose of 88 point.
At last day of the week, JUL 2021 closed at 91.21 with increase of 89 point.
PAKISTAN YARN MARKET
Due to increase in NYCF in previous week, prices remained on the increasing scale. Raw material shortage is still witnessed which resulted in demand & supply disparity. Therefore, prices remained firm due to shortage of availabilities. Suppliers are seen to have their space booked till early April.
An increase of 4-5 cents was seen for polyester. PSF prices increased by Rs 3/kg by 15th Feb 2021, it is likely to bring an effect of Rs 4-5/kg rise in coming week. Underlying reason behind this is a major gap between demand and supply.
Reasonable trading was seen in Faisalabad trading market in blended and PV yarns. Handsome demand was reflected in fine counts. It can be expected that prices will remain firm in coming weeks due to good demand followed by increasing orders in finished product line. Moreover, rising NYCF and shortage of raw cotton has also built-up a foresight for increase in yarn prices in coming weeks.
Following are current asking prices of yarn in local market based on ex mills:
|16/1 CD||560 – 595|
|20/1 CD||600 – 625|
|30/1 CD||660 – 690|
|20/1 CM||690 – 705|
|30/1 PC 52:48||505 – 540|
|40/1 CM||845 – 875|
|60/1 CM||1120 – 1150|
|80/1 CM||1420 – 1475|
EXPORT YARN MARKET
Polyester Fibre price showed bullish sentiment and increased by Rs 5/Kg dated 22th Feb 2021 and touching the level of PKR 205/Kg. However, it is still cheaper than the imported fibre as all suppliers increased their prices of fibre. Import price is in range of USD 1.18/kg with the landed cost of PKR 222/Kg. There are still chances of further increase in prices in days to come.
NYCF remained very bullish and crossed the barrier of 90 cents last week. Today, before opening the market, trading started which pushed prices to the level of 92 cents. It is expected that NYCF will touch the new height of 95 cents within this week. China cotton is also upward and showing handsome increase on daily trading session.
PC/CVC Yarn suppliers have sold very reasonable quantities in last week at increased price. Now suppliers are not willing to sell further bulk quantities. Offers validity is short and suppliers are offering small quantities at their desired levels. If we look at the suppliers situation, they are booked comfortable for more than 2 months and not showing interest for any further sale at the moment as future trend is also bullish.
Export market also showed upward sentiment and prices kept on increasing. Suppliers are increasing price on daily basis in line of cotton prices. Chinese customer came back last week partially after their New Year holidays and started to check prices in Pakistan. Bids started with the range of USD 490-495/Bale of 10/1 Siro yarn which were increased at weekend at to USD 500/Bale. So, under this situation it is most likely that price will show upward trend in days to come with good business activity.
European customers also remained in market and showed good business activity. Demand from European countries is very good but they are still resisting against high prices. Some deals were matured with selected suppliers after tug of war between both parties.
|16/1 CD||620 – 625||620 – 625||620 – 625||620 – 625|
|20/1 CD||630 – 640||630 – 640||630 – 640||630 – 640|
|20/1 CM||670 – 680||670 – 680||670 – 680||670 – 680|
|32/1 CD HOS UNWAXED 100% COT.||–||–||–||–|
|10/1 CD SIRO YARN FOR WEAVING||–||–||525 – 535||–|
PAKISTAN FABRIC MARKET
The local fabric kept firm trend and fabric prices vigorously rising throughout the week for both narrow and wider width fabrics.
Weavers received limited inquiries resultantly limited business reported in the market for both narrow and wider width fabrics owing to rising trend of yarn prices.
Weavers couldn’t materialize bulk inquiries as spinners were reluctant to keep their offers valid even for same day.
Weavers are offering in narrow width mid-April onward and wider width from early May onward.
Due to current yarn prices in the market, weavers are also hesitant to book bulk orders and are not ready to negotiate prices below to their desired inflows.
Keeping in view the current market situation we expect that market will continue same trend for coming weeks. therefore we suggest buyers to book their requirements to avoid loses.
Local fabric prices of regular items are as follows:
|Construction||Price US$/YD Ex Mill|
|20CDX16CD/128X60 – 63″ 3/1 ”S” TWILL PAK CTN||1.48 – 1.50|
|16X12/108X56 63″ 3/1||1.62 – 1.64|
|20CDX20CD/108X58 63″ 3/1 ”S” TWILL PAK CTN||1.20 – 1.18|
EXPORT FABRIC MARKET
Rising price trend was witnessed continuously hence some of the customers have started placing orders at existing prices. Decent quantity of orders were booked by Korea and Japanese customers. China offices will resumed work from next week then activity may started from China as well. Other markets like Indonesia, Bangladesh, Vietnam and Thailand was slow during the week as no considerable business activity was observed.
Asking prices further increased by 4~5% during the week and offering prices have limited validity due to very uncertain market situation.
Good suppliers are booked till end of April and offering early ~ mid May onward deliveries whereas average suppliers are booked till end of March and offering mid April onward deliveries.
Flow of inquiries remained good especially from Germany however limited quantity of orders were placed in the market. Other markets like Portugal, Italy, France and Spain was aside of buying during the week.
Wider width suppliers have good orders in hand thus they are offering June onward deliveries for new orders.
Prices for wider width also increased by 3~4% during the week and further hike in prices is expected in coming days as well.
USA market was slow during the week as no considerable buying was witnessed.
Following were the closing rates based on CNF Far Eastern ports:
|Construction||Price US$/YD CNF Far East|
|20CDX16CD/128X60 – 63″ 3/1 ”S” TWILL PAK CTN||1.50 – 1.52|
|16X12/108X56 63″ 3/1||1.64 – 1.66|
|20CDX20CD/108X58 63″ 3/1 ”S” TWILL PAK CTN||1.22 – 1.24|
BED LINEN & TOWELS
Bedding and towel manufacturers of Pakistan are in trouble due to increase of raw material prices. However, factories are booked till June-21. Business activity is comparatively slow to moderate due to repeat orders as factories has started their projection buying for their regular customers. Basic to higher thread count such as T144 to T200 are mainly in demand but supply of 30s and 40s yarn is not able to keep up with the demand due to shortage of cotton / polyester.
For new orders suppliers are facing difficulties to meet with the customer target prices as polyester fiber and other raw material prices are going upward. Lead time of orders has increased from 90 to 110 days.
Garment industry of Pakistan is enjoying a good demand from foreign buyers. Factories have filled their production capacities till May 2021 for the POs in hand and for the new inquiries coming in they are offering June onward deliveries. However for the repeat orders delivery can be managed from sixty to eighty days. Prices are firm due to increased raw material prices from around the globe. Statistics revealed that the value of textile and garment exports from Pakistan increased by 8.83 per cent year-on-year in dollar terms in the first seven months of fiscal 2020-21 started from 1st July 2020.
Considering the healthy demand being received by Pakistani garment units and anticipating a trajectory movement, a Chinese company is investing $150 million in an industrial park in Lahore which is one of the industrial hub of garment manufacturing units in Pakistan. This will house state-of-the-art fabric units, dyeing facilities and garment manufacturing units for exporting sportswear from Pakistan to the Americas, Europe, Asia-Pacific and other regions of the world.
About future market it is expected that local yarn prices will remains firm and increasing trend due to massive demand and shortage of yarn and raw cotton, firm in NYCF and massive orders of finished product in Pakistan market. Further yarn prices trends will be according to demand and supply of different yarn counts which will lead price level
In the local cotton market, firm and stable price trend was observed due to low business activity. While bullish trend was seen in international market. It seems that international market will remain firm and upward in coming days and local market too.
Keeping in view the current market situation we expect that local fabric market will continue same trend for coming weeks. therefore we suggest buyers to book their requirements to avoid loses.
Export yarn market is surely going to gain further and prices will not show any kind of correction rather prices are going to rise further in days to come. So, it is suggested to book maximum quantities with suppliers before prices are moved upward further.
Export fabric business activity was good during last week and expected to remain good in coming days as well. Prices are expected to remain firm with tendency to further upward.
For Home Textile, buyers are placing only urgent orders and in coming week; we are not seeing any drop in prices.
Asking prices are expected to remain firm for the garments as raw material prices have been increased all over. Increased demand and order finalization have filled the factories’ production capacities till May 2021.