Pakistan Cotton Market:
During the last week, dullness prevailed as buyers didn’t show interest in buying. After Eid holidays buyers didn’t come in momentum , hence demand is still slow and textile business is in a difficult situation in these days. Ginners are interested to sale but have no demand. New arrival from Sindh side started partially, full arrival expected from Sindh from mid May onward.
In whole week the rate of cotton remained stable. The rate of cotton was Rs 18,000 to Rs 20,000 per maund. The price of Phutti is in between Rs 8,500 and 9,000 per 40 kg. KCA was same at the level of rs 20,000 per maund. PSF remained same at the level of 375 pkr/kgs.
Cotton crop is of key importance for the country’s economy. Government is taking vigorous steps to revive cotton. This year, the support price of cotton has been fixed at Rs. 8500 per 40kg, which will make cotton cultivation profitable. Government of Punjab is continuing to provide subsidy of Rs1200 per bag on certified seeds of selected approved varieties of cotton. In addition, for the control of harmful insects of cotton bio cards will be provided to the farmers through the Bio Lab established in Punjab.
Last week began on a positive note as prices climbed above 85 cents for the first time since March 7th. Mired in a six-month trading range a return to the upper end appeared to have technical merit inspiring Managed funds to reconsider and become buyers. Though still net short as they have been for nine weeks their position has been reduced to less than a million bales. Both July and December futures surpassed several short-term moving averages. Better yet, it retraced two-thirds of the fall from its high of eighty-nine cents to its most recent low of seventy-six cents. This was until Thursday when prices tanked on near limit down trading to find support once again at 80 cents. On the week, old crop and new crop futures lost almost two and half cents remaining range bound albeit on the lower end.
Word that China’s economy was strengthening post Covid, as everyone had anticipated, helped spur the early week rally. In the first quarter of 2023 their economy expanded 4.5 percent compared to a growth of only 2.9 percent the previous three months. This was the fastest rate of growth since the first quarter of 2022. An increase in retail sales led to this expansion more so than industrial growth. Also last week, it was revealed India is set to surpass China as the world’s most populous country at 1.42 billion people. This is important to global trade as India is currently a net importer of cotton.
July futures fell below support to 79.65 before rebounding slightly, while December traded similarly. Such a reversal was the result of a combination of several factors, one of which was a significant decline in export sales and shipments from previous weeks. Nonetheless, at 87,300 bales and 308,600 bales respectively, they still exceeded the weekly average needed to meet export estimates. In addition, there was more speculation the Fed would hike interest rates another twenty-five basis points at their May 1st meeting. Such a move is sure to strengthen the Dollar and negatively affect commodities. Lastly, unable to blow through its 200-day moving average sell stops were triggered on the way back down exacerbating the selloff.
The rate of cotton in Sindh is in between Rs 18,000 to Rs 20,000 per maund. The rate of Phutti as per quality is in between Rs 8,000 to Rs 9,000 per 40 kg. In Punjab province, the price of cotton was Rs 18,500 to Rs 20,000 per maund, and the price of Phutti was Rs 8,500 to Rs, 9,500 per 40 kg.
The price of Phutti was in the range of USC 0.77~0.90 Lbs. (18,000~20,000/ maund).
|Opening Of the Week||Closing Of the Week||Change|
Crude Oil prices opened at USD 78.76 higher than last week’s closing figures.
This week, crude oil prices dropped in the next three sessions and later showed an upward trend till closing, hence, week closed on the lower side by the end of the week.
On the last day of the week, Crude Oil price closed at USD 76.78 with a decrease of USD 1.98 cents as of the opening figure of the week.
|Opening of Week||Closing Of Week||Change|
In the last week values of Pak rupee deprecated against US Dollar, and other major currencies showed mix trend in both interbank and open markets.
At the end of the week, Euro closed on a positive note with the figure of 1.11 and the British Pound also closed on a positive note with the figure of 1.26 against USD.
|LC 120 Days||272.72||272.67|
New York Cotton Future:
New York Cotton futures opened with slight higher level on Monday as compare to previous week’s closing figures.
NYCF showed downward tendency in three sessions ,later rose in next two sessions and closed on upper side by the end of week.
On the last day of the week, MAY 2023 closed at 79.03 with slight increase of 5 points.
JUL 2023 closed at 80.80 with addition of 11 points.
OCT 2023 closed at 81.75 with the hike of 9 points.
DEC 2023 closed at 81.10 with decline of 17 points.
Liver Pool Indices:
Liverpool Index A opened at 93.30 on the lower side of the previous week of closing figure.
This week Index “A” showed mix trend and closed on the lower side by the end of the week.
On the last day of the week, LPI “A” closed at 93.15 with a decrease of 15 points.
|Opening of the Week||Closing of the Week||Change|
Pakistan Yarn Market:
The local yarn market sustained a stable in asking prices and an unhurried business bustle by the end of this week following NYCF and the local cotton market. The restricted activity was observed with a partial series of queries. Factories have inventories with sales pressure and buyers are also stuck in payments & remittances. The clients were in a state of perception and the prices of raw cotton on the world market are followed by the NYCF.
PSF prices remained constant in the domestic market throughout the week. PTA and MEG prices remain lenient in the international market, owing to the increase in the US $ parity effect in Pakistani rupees on importing fiber. At the same time, crude oil prices are expected to rise by the end of the week. PSF prices are predicted to remain unchanged during the coming week.
The trading market in Faisalabad sees steady sales of PV and Viscose yarns but no interest in PC or 100% Cotton yarn. Challenges with cash flow and financial constraints continue. The stock holdings of the traders were substantial, and the management of the yarn by the owners of the looms was intractable.
The followings are the latest querying prices of yarn in the local market based on ex-mills.
|Count||Price in Pak Rupees / 10 LBS||Price US$/Bale|
|16/1 Carded Weaving||3350 – 3500||475 – 495|
|20/1 Carded Weaving||3450 – 3650||485 – 515|
|30/1 Carded Weaving||3750 – 3900||530 – 550|
|30/1 PC Carded Weaving 52:48||3000 – 3150||425 – 445|
|40/1 Combed Compact Weaving||4250 – 4350||600 – 615|
|60/1 Combed Compact Weaving||5900 – 6100||835 – 860|
|80/1 Combed Compact Weaving||8000 – 8200||1130 – 1160|
|40/1 CVC Carded Weaving 60:40||3600 – 3850||510 – 545|
Export Yarn Market:
Export yarn market remained under average business activity. customers have floated handsome numbers of enquiries. Suppliers showed good interest but prices remained firm and stable. However, they showed flexibility upon receipt of firm bids. It has been observed that customers have shared good quantity bids against which orders confirmation was also decent. Bids levels remained almost same as last week prices and suppliers were happy to sell on same levels. Most of the suppliers now are in comfortable zone as they have sold May shipments and not showing any panic to sell on lower levels. It is expected that next couple of weeks, suppliers will remained firm and stable with slight increase in prices to get better rates. Chinese customers floated reasonable numbers of enquiries against which order materialization was also good. European customers floated limited numbers of inquiries but order confirmation remained dull and slow.
|Count||USD / Bale|
|16/1 Carded Weaving||500 – 505|
|20/1 Carded Weaving||510 – 515|
|20/1 CM||530 – 535|
|16/1 CM||515 – 520|
|20/2 CD||535 – 540|
|24/2 CD||545 – 550|
|10/1 CARDED SIRO YARN WEAVING||460 – 480|
Pakistan Fabric Market:
In the current week under review, the market sentiments improved for both narrow and wider-width fabrics.
Though local finishers were unable to share bulk inquiries however small traders shared inquiries and towards the end of the week limited activity was reported whereas prices tend to show an upward trend because the yarn market showing a firm and rising trend due to which buyers booked some orders after tough negotiations at increased price level as compared to before holidays.
Finishing units are still placing their maximum orders to their own weaving units owing to the unavailability of orders in the Market.
Major weaving mills are booked in narrow width till the 3rd week of May ~ end of May’2023 whereas they have coverage of their wider width looms till early June-Mid-June’2023 and offer onward deliveries.
Weavers are comfortably booked in dobby looms and are covered till the end of June’2023.
|Construction||Price US$/YD Ex Mill|
|16CDX12CD / 108X56 – 63″ 3/1 “S” TWILL PAK CTN||1.34 – 1.36|
|20CDX16CD / 128X60 – 63″ 3/1 “S” TWILL PAK CTN||1.22 – 1.24|
|20CDX20CD / 108X58 – 63″ 3/1 “S” TWILL PAK CTN||1.01 – 1.03|
Export Fabric Market:
Far Eastern markets were active towards end of the week as suppliers have received good flow of inquiries resultant decent booking with selected suppliers.
Asking prices were stable with firm tone during the week under review.
Suppliers have some how extended their sales position for next 3~4 weeks and offering end May ~ early June onward deliveries.
Some of the European and USA buyers were active during the week as they have placed good number of orders mainly in wider width.
Prices remained same as of last week.
Most of the weaving units closed down their productions during last Eid festival holidays due to less orders in hand.
Suppliers are offering July onward deliveries for wider width fabric now a days.
Following were the closing rates based on CNF Far Eastern ports.
|Construction||Price US$/YD CNF Far East|
|16CDX12CD / 108X56 – 63″ 3/1 “S” TWILL PAK CTN||1.34 – 1.36|
|20CDX16CD / 128X60 – 63″ 3/1 “S” TWILL PAK CTN||1.20 – 1.22|
|20CDX20CD / 108X58 – 63″ 3/1 “S” TWILL PAK CTN||0.98 – 1.00|
Bed Linen & Towels:
Due to low activity globally, the home textile industry is now operating at a slower pace. This trend is anticipated to continue through the middle of this year. Global demand as a whole is slowing down, which has an impact on global business volume in Pakistan as well as other places.
Due to poor business volumes, firms are having a difficult time operating their factories as raw material prices are also rising as a result of the depreciation of the Pakistani Rupee.
Many countries have experienced a decline in demand for clothing, as consumers have cut back on spending due to economic uncertainty. In terms of order placements, Pakistan’s apparel sector was quite low in getting orders from international customers. Normally, factories received projection-based orders from big retailers but in 1st quarter of 2023, there has been slow sentiment in the market, one of the reason is global inflation.
At the same time factories are expecting BULK ORDERS against the developments that they have made in the 1st quarter of 2023.
Sustainability is crucial in the garment industry to reduce its environmental impact, improve working conditions, meet consumer demand, increase resource efficiency, and future-proof the industry
Regarding the upcoming market, it is determined that consumer demand drives local yarn prices with moderate activity. Further price changes will be made in accordance with market conditions and end-user demands, which will determine the price level.
Dullness prevailed in the local cotton market and internationally, around the globe cotton sale is slow and buyers are not showing interest. Pakistani Ginners still have stocks with them around 2 lakh bales despite of that Pakistan was short crop in previous season.
Improved business activity was seen in local fabric market. Finishing units are placing maximum orders to their own units due to less orders in hand. We expect steady business activity may observe in next week as well.
Export yarn market remained firm and stable with good business activity. suppliers are on comfortable zone after handsome sales in last couple of weeks. Hence, we might expect prices to remained in same range with slight tendency of better rates,
Business activity remained good for both narrow and wider width fabric as customers from Far Eastern, Europe and USA were active and placed decent quantity of orders. Wider width suppliers are in comfortable position now. Prices were stable as of last week. Suppliers are expecting steady business activity during coming days as well.
The garment industry is not stable with orders but there is a ray of hope generating, The situation will clear in near future.