Market Report- Pakistan 13 Nov 2023

Pakistan Local Cotton Market:
(Local cotton market encountered a challenging week marked by global and local factors. The international demand for cotton was constrained by inflation and decreased consumer spending on textile goods. Nevertheless, the local market demonstrated resilience by maintaining stable prices, attributed to currency appreciation and the anticipated shortage of quality cotton in the near future)

1- The international cotton market experienced a lackluster performance influenced by global inflation and reduced demand for textile goods. Despite a decrease in trade activity worldwide, local markets maintained stable prices. This resilience was attributed to the strengthening of the US dollar and an anticipated scarcity of high-quality cotton in the near future.
2- The global textile products market exhibited sluggishness and weakness. Trade was hindered by inflation and increasing interest rates, contributing to an adverse impact on business operations.
3- China’s decline in cotton fabric shipments, influenced by lower synthetic prices and production growth, underscores its pivotal role in global fiber production. Competitive pricing of Chinese synthetic yarns is reshaping the textile supply chain, favoring cost-effective synthetic inputs.
4- Cotton prices, currently at 75-76 cents, have recently dropped due to concerns over demand and U.S. exports. Despite the USDA’s November report raising the projected U.S. crop, uncertainties persist in the market, with a cautious outlook on global production and trade dynamics.
5- Last week, cotton prices in Punjab and Sindh showed firm trend, business materialized in ranging from Rs 15,500 to Rs 18,000 per maund, (USC 0.68~0.79 lbs) with Phutti prices at Rs 8,500 per 40kg. In Sindh, cotton rate was
Rs 15,500 to Rs 17,200 per maund, while in Punjab it ranged from Rs 16,000 to Rs 18,000 per maund. KCA was up Rs.200 to at Rs. 17,700 per maund and PSF increased Rs. 8 to at Rs. 358 PKR/kg.

Local Yarn Market:
(The yarn market remained slow with stable prices. It is expected to remain stable despite pressure on coarse counts due to slow Chinese exports. Price trends will be determined by cotton prices, customer demand, and supplier offers)

1- The local yarn market remained stable in asking prices with slowed business activity.
2- Mills have stocks in OE & PC/CVC yarn and some other counts on demand can start after a week.
3- The prices of PSF were increased twice by IFL Rs. 5/kg on November 6 & Rs. 3/kg on November 10 in the domestic market and are expected to increase Rs 2~3 more by next week.
4- Faisalabad’s market is usual with slow sales of PC/PV yarn and concerns about cash flow.

Count Price in Pak Rupees / 10 LBS Price US$/Bale
16/1 Carded Weaving 3250 – 3350 455 – 470
20/1 Carded Weaving 3250 – 3550 455 – 495
30/1 Carded Weaving 3550 – 3800 495 – 530
20/1 CM 4000 – 4100 560 – 575
30/1 PC Carded Weaving 52:48 2950 – 3050 415 – 425
40/1 Combed Compact Weaving 4400 – 4500 615 – 630
60/1 Combed Compact Weaving 6250 – 6450 875 – 900
80/1 Combed Compact Weaving 8400 – 8500 1175 – 1190
40/1 CVC Carded Weaving 60:40 3500 – 3650 490 – 510

Export Yarn Market:
(Export yarn market remained under dull business activity. customers remained on sideline as there due to uncertain market conditions. We might see another phase of slow business activity in days in to come)

1- Export yarn market remained under the uncertain market conditions due to fluctuation in cotton prices.
2- Customer kept on checking prices but order materialization was limited. Only few orders were placed where customer found their desired price levels.
3- Suppliers showed flexible tone and prices were on downward side in presence of firm bids.
4- Overall cotton in domestic and international market remained soft till mid of week. However mid week onwards, things started to get better and some improvement was witnessed.
5- Despite low cotton prices, cost of production in Pakistan has been increased which is still hurting suppliers and they are losing hefty amounts.
6- Local market behaving well, which put the market condition better.
7- Chinese customers floated good numbers of inquiries but order materialization was slow.
8- European customers were checking prices and we might see another phase of buying for the onwards delivery.

Export Yarn Prices
Count USD / Bale
16/1 Carded Weaving 475 – 485
20/1 Carded Weaving 485 – 495
20/1 CM 505 – 515
16/1 CM 505 – 515
20/2 CD 510 – 520
24/2 CD 525 – 535

Local Fabric Market:
(For the coming week, we expect the market to remain firm with the tendency of moving upward with limited demand for both narrow and wider-width fabrics)

1- In the current week under review, the local fabric market showed dull activity throughout the week for both narrow and wider width fabrics.
2- Local buyers poured inquiries for both narrow and wider width looms but those were mainly for price checking.
3- Buyers booked some orders towards the end of the week and the week closed with improved business activity.
4- Weavers slightly increased their asking prices as compared to last week due to an increase in production cost and firm yarn prices. Suppliers were still chasing orders but could not book more due to low target prices from buyers.
5- Major weavers booked their narrow-width looms till early December’2023 whereas they have coverage of their wide-width looms until 3rd week of December 2023 and are offering onward deliveries.

Export Fabric Market:
(Average business activity was observed in export fabric sector with stable asking prices. Customers are avoiding to increase their stocks hence buying only urgent orders)

1- Export fabric market is continuously behaving slow due to less demand around the globe.
2- Customers are keeping stocks hence they are not interested into new buying. Only urgent orders were booked by some customers at existing prices.
3- Despite of increase in yarn prices, fabric prices remained stable due to slow demand.
4- Suppliers are booked for next 2~3 weeks and offering early ` mid Dec onward deliveries.
5- European and USA buyers have exchanged good number of inquiries however business materialization was limited
6- Wider width suppliers are in somehow comfortable zone and offering Jan onward deliveries.
7- European customers are much concern on their stocks as they do not want to increase their inventory hence focusing to buy urgent orders.
8- This could be prolonged war between Ukraine, Russia and now Palestine and Israel.
9- USD is continuously appreciating against PKR which help suppliers to offer better prices.

Local and Export Fabric Prices
Construction Price US$/YD Ex Mill Price US$/YD CNF Far East
16CDX12CD / 108X56 – 63″ 3/1 “S” TWILL PAK CTN 1.30 – 1.32 1.32 – 1.34
20CDX16CD / 128X60 – 63″ 3/1 “S” TWILL PAK CTN 1.17 – 1.19 1.20 – 1.22
20CDX20CD / 108X58 – 63″ 3/1 “S” TWILL PAK CTN 0.98 – 1.00 0.98 – 1.00

Bed Linen and Towel:
(Home textile sector remained active as suppliers locked good volume of business. Institutional business also went well. However, increasing fuel and gas prices will have an impact on prices which will be observed in coming days)

1- Another week went well in term of business activity. Suppliers are in process locking orders in presence of better cotton prices.
2- Firm inquiries were received from Europe and bookings were made in value added products
like Yarn Dyed and specialized Made ups.
3- White institutional business has also seen a relatively good projection.
4- Well reputed big textile exporters are running at 70 to 80% of processing capacities
5- Business movement at mid-tier factories is also observed in Faisalabad market side in regular programs like percale and satin prints and dyed made ups.
6- Gas inflation and USD rate will further shape course of business action in upcoming weeks.

(Generally, garment demand is slow due to uncertain economic situations around the globe. Negligible orders received from EU and USA. The denim sector is optimistic about getting more orders during 4th quarter for sustainable products)

1- Overall Pakistan’s garment industry is facing uneven business activity, factories are not getting enough orders to fill their 100% production capacities. Due to inflation, it has been observed that many retailers and brands have reduced their buying.
2- Normally, factories receive projection-based orders from large retailers, but there has been a slow sentiment in the market in the 4th quarter of 2023, one of the reasons being global inflation. For onward orders factories are offering Early Feb 2024 deliveries.
3- In the garment industry, sustainability is critical for reducing environmental impact, improving working conditions, meeting customer demand, increasing resource efficiency, and future-proofing the industry.
4- From the denim sector hopeful signals are coming from the U.S. economy, and the recovery from the pandemic seems to have really taken. However, it’s essential to recognize that consumer confidence is still somewhat tempered due to persisting uncertainties in the global landscape.

Crude Oil:

1- Crude Oil prices opened at USD 80.82 with slightly higher level as compared to last week closing figures. in this week, crude oil prices showed downward trend and closed on lower side by the end of week.
2- In last day of the week, Crude Oil price closed at USD 77.17 with decrease of USD3.65 cents as of opening figure of week.

  Opening of Week Closing Of Week Change
Price 80.82 77.17 -3.65

Exchange Rate:

1- In last week values of Pak rupee deprecated against US Dollar’s, other major currencies showed mix trend in both interbank and open markets.
2- At the end of week, Euro closed on a positive note with figure of 1.07 and British Pound closed on negative note with figure 1.22 against USD.

  Selling Buying
LC Sight 285.98 285.93
LC 120 Days 276.08 276.03
Open Market 290.32 284.08

New York Cotton Future:

1- The New York Cotton futures started the week lower than the previous week’s closing figures. NYCF Showed downward sentiment by the start of week, hence later showed some recovery but closed on lower side than the opening figures. The closing figures for the week were:
2- On the last day of the week, DEC 2023 closed at 77.32 with decrease of 68 points.
3- On the last day of the week, MAR 2023 closed at 79.50 with lower of 142 points.
4- On the last day of the week, MAY 2023 closed at 80.28 with drop of 172 points.

Liver Pool Indices:

1- Liverpool Index A was opened at 91.80 on higher level from the previous week of closing figure.
2- In this week Index “A” dropped and closed on lower side
3- At last day of the week, LPI “A” closed at 87.55 with decrease of 425 points.

  Opening of the Week Closing of the Week Change
Index A 91.80 87.55 -4.25