Pakistan Local Cotton Market:
(The depreciation of currency in Pakistan has tightened the situation for local cotton buyers, who are buying from local sources to avoid the high cost of imports. The local cotton prices may continue to rise due to the high demand and low supply. Therefore, buying cotton on all levels to secure their stocks and profits)
1- In the domestic cotton market, prices showed upward trend with improved business activity. Buyers remained active in buying in fear that prices may rise further.
2- The primary driver behind the rise is the devaluation of the rupee against the dollar. As the rupee fell to a record low against the US dollar, cotton prices jumped to Rs. 20,800 per 40 kg while the phutti prices are also averaging above Rs. 9,000 across Punjab.
3- Traders have realized that imports would get more expensive or nearly impossible as the rupee continues to fall.
4- Cotton picking has also slowed down in the big cotton-producing regions of Bahawalnagar, Rahim Yar Khan, and Bahawalpur which has also contributed towards the price increase. Cotton ginners expecting that cotton to cross high range number of Rs. 23,000 in the coing days, if the currency keep devaluing around 320~325.
5- Due to the excellent weather conditions this year and the reduction in environmental pollution due to less cultivation of sugarcane in the cotton zones, the quality of cotton is in line with international standards, along with abundant purchases by local textile mills.
6- A foreign firm is also purchasing large quantities of cotton from Pakistan this year, due to which a record trend is being seen in the prices of cotton.
7- International cotton prices upward trend was seen , which also put pressure on importers.|
8- Cotton arrival in Pakistan witnessed a significant increase of 48% on August 15 compared to August 1, as per the latest fortnightly data released by the Pakistan Cotton Ginner’s Association (PCGA) on Friday. Total cotton arrival in Pakistan rose to 2.12 million bales as of August 15 compared to 1.43 million bales recorded on August 1, 2023, an increase of 0.69million bales.
9- As of August 15, cotton arrival in Punjab clocked in at 0.64 million bales as compared to 0.39 million bales reported on August 01, 2023, an increase of 64%.
10 Similarly, cotton arrival in Sindh was 1.48 million bales compared to 1.04 million bales recorded in August 1, an increase of 0.44 million bales or 42%.
11- Last week, cotton prices in Punjab and Sindh increased around 1200~1500 per maund, ranging from Rs 18,500 to Rs 20,800 per maund, (USC 0.74~0.81 lbs) with Phutti prices at Rs 8,500 to Rs 9,000 per 40kg. In Sindh, cotton rate was Rs 18,700 to Rs 20,000 per maund, while in Punjab it ranged from Rs 19,000 to Rs 20,800 per maund. KCA increased rs. 1200 to at Rs. 19,600 per maund, and PSF surged rs.5 to at 365 pkr/kg.
Local Yarn Market:
(The level of business activity in local yarn market is determined by the demand from individual customers and the current price of cotton in Pakistan)
1- The prices of yarn in the local market increased by 4~5 % mainly due to the upward trend of the US dollar and the decline of the Pakistani rupee
2- The cost of producing goods has increased due to high electricity bills and an increase in raw cotton prices, leading to concerns about cash flow.
3- The prices of PSF were increased by IFL Rs. 5/kg on August 21 in the domestic market and are expected to increase Rs 2~3 more by next week.
4- Faisalabad market is good in demand, with virtuous business activity. However, there are concerns about possible cash flow issues.
| Count | Price in Pak Rupees / 10 LBS | Price US$/Bale |
| 16/1 Carded Weaving | 3600 – 3750 | 480 – 500 |
| 20/1 Carded Weaving | 3550 – 3850 | 475 – 515 |
| 30/1 Carded Weaving | 3900 – 4200 | 520 – 560 |
| 30/1 PC Carded Weaving 52:48 | 3180 – 3250 | 425 – 435 |
| 40/1 Combed Compact Weaving | 4600 – 4750 | 615 – 635 |
| 60/1 Combed Compact Weaving | 6200 – 6400 | 830 – 855 |
| 80/1 Combed Compact Weaving | 8300 – 8500 | 1110 – 1135 |
| 40/1 CVC Carded Weaving 60:40 | 3750 – 3850 | 500 – 515 |
Export Yarn Market:
(The export yarn market remains firm and stable, with a moderate balance of demand and supply. Chinese buyers are holding off their bookings until the China Fair, which is about to start soon. The market may see more activity from China and Europe in the coming weeks. The export yarn market showed decent business activity as customer remain in market and floating handsome number of enquiries but booked less yarn)
1- Suppliers are still firm in their prices, hence may lower the prices due to the devaluation. Currency devaluation could benefit exporters only. However, mill costs are also rising and affecting production negatively.
2- We expect to see some buying from China in the expo yarn, which will start by the end of August. Mills have shipments for September and October to sell.
3- European customers are on holidays and will resume work from next week , this will be an added factor to drive market as they have not booked order before holidays and once they are back there will be handsome activity.
4- We might see good business activities to come from china in coming days.
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Local Fabric Market:
(For the coming week, we expect sentiments to show that the market has the tendency to move upward so suggest buying asap to avoid further increase in prices)
1- The current week under review opened in bullish mode and the week closed with changed sentiments with good trading activity for both narrow and wider-width fabrics.
2- Buyers were forced to share their held inquiries because due to dollar appreciation, weavers increased their asking prices twice a day owing to increase in yarn prices, and fabric prices continued to rise in line with yarn prices which approximately 5-8% price increment reported towards the end of the week.
3- Weavers extended their booking level end of September’2023 for narrow-width fabrics and till the end of October / early November for wide-width fabrics.
4- Conversion-based loom suppliers have increased their loom flows about 4~5% due to an increase in the cost of production.
Export Fabric Market:
(Export fabric market remained active with good sales both in Far Eastern and Europe / USA markets. The prices remained firm due to increase in raw material prices)
1- Fabric business activity was improved during the week under review.
2- Customers from China, Korea, Japan and Vietnam has booed decent quantities with their selected suppliers.
3- Asking prices remain firm due to increase in raw material prices.
4- The USD is continuously on rise against PKR
5- Some of the European and USA buyers are back from their summer holidays and started sharing their inquiries aggressively.
6- The European market will be fully in operation from next week as customers will resume their work during last week of the month
7- USA buyers have placed decent quantities both in narrow and wider width fabric during the week.
8- Wider width suppliers have extended their sales till Oct and now offering Nov onward deliveries.
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Bed Linen and Towel:
1- This week in Home Textiles, we see some business activities better than last week. The flow of inquiries from European, UK, and USA markets were seen but mostly were for the price check before going on holidays. It is expected that the pattern will remain the same until end of August as stores still have a lot of stocks.
2- The factories are running at between 55- 65% of their capacity.
3- There is a financial crisis that still prevails but is expected to be better in the coming months.
4- Home textile business activity is stable and expected to be better in coming months.
Garments:
(While the garment industry as a whole is struggling, certain European and American brands and stores are expecting orders to fill factory capacity)
1- The garment industry in Pakistan is likely to continue to contribute significantly to the country’s economy, despite potential obstacles posed by the industry’s need to adapt to changing global market conditions.
2- However, knitting and dying capacities are being partially filled for Oct/Nov 2023 delivery, according to various sources. This demonstrates the positive market attitude in Pakistan due to increased demand from numerous European clients and some from the US market, particularly from several large retailers, factories have room to begin deliveries in November 2023.
3- With Challenges like fluctuating dollar rates and cotton prices, denim producers are finding it hard to secure customer-required FOB as compared to other denim countries.
Crude Oil:
1- Crude oil prices opened at USD 80.72 this week, lower than the previous week’s closing figures.
2- The price showed a downward trend throughout the week and closed on the lower side.
3- On the last day of the week, crude oil prices closed at USD 79.83, a decrease of USD 0.89 cents from the opening figure of the week.
| Opening of Week | Closing Of Week | Change | |
| Price | 80.72 | 79.83 | -0.89 |
Exchange Rate:
1- In the last week values of the Pak rupee depreciated against US Dollar’s, and other major currencies showed a mixed trend in both interbank and open markets.
2- At the end of the week, the Euro closed on a negative note with a figure of 1.08 and the British Pound closed on a negative note with a figure of 1.26 against USD.
| Selling | Buying | |
| LC Sight | 299.45 | 299.40 |
| LC 120 Days | 292.65 | 292.60 |
| Open Market | 303.51 | 297.00 |
New York Cotton Future:
1- New York Cotton futures opened at a higher level on Monday compared to the previous week’s closing figures. NYCF showed an upward trend in a whole week and closed on positive notes.
2- On the last day of the week, OCT 2023 closed at 87.51 with an increase of 305 points.
3- On the last day of the week, DEC 2023 closed at 87.31 with a rise of 360 points.
4- On the last day of the week, MAR 2023 closed at 87.19 with a higher of 353 points.
Liver Pool Indices:
1- Liverpool Index A opened at 94.10 on the same level as the previous week’s closing figure.
2- In this week Index “A” rose and closed on the positive side.
3- At the last day of the week, LPI “A” closed at 95.85 with a decrease of 175 points.
| Opening of the Week | Closing of the Week | Change | |
| Index A | 94.10 | 95.85 | -1.75 |
