Market Report- Pakistan 19 Feb 2024

Pakistan Local Cotton Market:
(The local cotton market showed a bullish trend, mirroring a notable rise in USA cotton prices. As the local season concludes, panic buying resulted, and import viability was compromised by a steep price increase, introducing  uncertainty among spinners)

1- Throughout the entire week, the local cotton market showed bullish trend in term of activity and prices. USA cotton showed significant increase in cotton prices and which local cotton followed the same.
2- Local cotton season is going to over, due to which panic buying was observed. It was the time that importer consider the import but steep rise in prices reduced the viability.
3- In the span of a month, a significant 18-19% surge in prices was witnessed in both USA and local cotton, marking a substantial increase that has created uncertainty among spinners.
4- Despite the stagnant demand for textile goods, the upward trend in the USA cotton is causing confusion regarding its sustainability – whether it will persist or decline in the coming days.
5- Last week, cotton prices in Punjab and Sindh showed upward to firm trend from Rs 20,500 to Rs 23,000 per maund, (USC 0.87~0.99 lbs). In Sindh, cotton rate was Rs 20,500 to Rs 22,500 per maund, while in Punjab it ranged from Rs 21,000 to Rs 23,000 per maund. KCA was up rs. 500 to at Rs. 21,000 per maund and PSF remained same at rs. 365 PKR/kg.

Local Yarn Market:
(Local yarn prices jumped up by 10~15% during the week. It is assessed that market is likely to maintain firm prices with slow activity in the near term. Furthermore, movement will clear by next week)

1- Domestic yarn prices witnessed a sudden jump of 10-15% due to recent increases in NYCF and local cotton prices. This rise in input costs has led to high production costs, causing spinners to curtail production or even shut down operations.
2- PSF prices remained stable on the domestic market and for next week are expected to remain stable.
3- The Faisalabad market saw limited activity, and PV yarn is in demand for value-added products. Cotton counts and PC yarn sales remained thoughtful, likely due to rising input costs and uncertain export demand.

Count Price in Pak Rupees / 10 LBS Price US$/Bale
16/1 Carded Weaving 3600 – 3800 515 – 545
20/1 Carded Weaving 3700 – 3900 530 – 560
30/1 Carded Weaving 4000 – 4150 575 – 595
20/1 CM 4200 – 4300 605 – 620
30/1 PC Carded Weaving 52:48 3300 – 3400 475 – 490
40/1 Combed Compact Weaving 4800 – 4950 690 – 710
60/1 Combed Compact Weaving 6600 – 6800 950 – 975
80/1 Combed Compact Weaving 8700 – 9400 1250 – 1350
40/1 CVC Carded Weaving 60:40 4150 – 4250 595 – 610

Export Yarn Market:
(Export yarn market remained firm and stable with the rising trend in prices in line of cotton prices. customers floated good numbers of enquiries against which orders materialization was also witnessed where customer increased their targeted prices)

1- The export yarn market remained firm and stable with good business activity.
2- Good numbers of inquiries were floated by customers against which handsome quantity business was closed.
3- Suppliers have increased prices due to better sales and higher demand.
4- Cotton prices, both local and international markets showed an upward trend and we may see more rise in days to come due to very good demand from all regions.
5- This will impact on yarn prices as well and suppliers are anticipating further price hikes in days to come.
6- The global supply chain crisis has led to higher shipping costs to Europe/USA, potentially causing a significant rise in yarn prices due to 3-4 times higher freight charges.
7- Decent inquiries from China were received against which orders were also closed with improved prices.
8- European customers were actively engaged after the upward trend in prices and have placed orders by increasing their prices to avoid further hike in days to come.

Export Yarn Prices
Count USD / Bale
16/1 Carded Weaving 510 – 515
20/1 Carded Weaving 520 – 525
20/1 CM 535 – 540
16/1 CM 530 – 535
20/2 CD 570 – 575
24/2 CD 600 – 605

Local Fabric Market:
(Domestic fabric market remained slow with limited activity. We expect the fabric prices to tend to rise further so partial quantities may be booked of the orders in hand)

1- In the current week under review, the local fabric market remained slow and the week closed with limited trading activity for both narrow and wider-width fabrics, whereas fabric prices steeply rose throughout the week.
2- Local buyers shared limited inquiries but the majority of the inquiries were just for price checking owing to the continuous rise in yarn and fabric prices. Resultantly week closed with limited order confirmation at 1%~2% increased price level.
3- Currently, the weavers booked their narrow-width looms until 3rd week of March 2024 and their wide-width looms until mid-April 2024 and are offering onward deliveries.

Export Fabric Market:
(Export fabric market was slow during the week with limited number of inquiries. Suppliers are expecting that customers will start placing orders even at high rates because the prices are rising in all regions)

1- The export fabric market has been slow since the last couple of weeks. Far Eastern markets were closed due to the Lunar New Year.
2- Asking prices jumped up by another 2~3% due to a sudden rise in raw material prices.
3- Suppliers are booked until mid-March and offer onward deliveries.
4- European and USA customers were engaged with regular inquiries, but no considerable business was reported.
5- Customers are reluctant to accept rise in prices; hence, they are watching market sentiments closely
6- Suppliers are expecting that customers will start placing orders because the raw material prices are increasing in all regions.
7- Wider width suppliers are booked till end of March ~ mid of April and offering end April onward deliveries.

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 1.40 – 1.42 1.42 – 1.44
20CDX16CD / 128X60 – 63″ 3/1 “S” TWILL PAK CTN 1.26 – 1.28 1.28 – 1.30
20CDX20CD / 108X58 – 63″ 3/1 “S” TWILL PAK CTN 1.04 – 1.06 1.04 – 1.06

Bed Linen and Towel:
(Home textile sector remain stagnant. Slow week with a lot of concerns over increasing inflation and energy / production costs. A revival policy backed up Govt. is very much needed at this moment)

1- Home textile business situation is becoming a bit unstable as observed in current week.
2- Inconclusive elections have resulted in a negative global impact as well as outcry from various agencies which has negatively affected the business thought.
3- Moody’s downgrades Pakistan’s credit outlook to negative due to political uncertainty.
4- Gas Tarif further increased. High production costs and continuous inflation has badly affected suppliers to retain or compete customer target prices.
5- Order confirmations are slowing down gradually with the passage of time.
6- A revival policy back by Govt. authorities is much needed at this moment to avoid the catastrophic effects of this situation.

(Due to moderate demand from the US and EU markets, overall garment manufacturers in Pakistan are operating at average capacity and waiting for orders to fill their space; nonetheless, there is some hope that certain   leading garment companies have begun placing orders with selected units)

1- Pakistani garment units are searching for large volumes to fill their production space. Some of the factories have received good orders from their export-based customers. Some major global apparel labels have also begun placing orders. This has provided a gleam of hope for the forthcoming seasons.
2- A few brands are also developing new products for the SS25 season. At the same time, some textile firms are still recruiting workers.
3- Some of the knitting producers have recently received good orders from retail brands.
4- Overall, factories have delivery accessible 90 to 100 days after order confirmation.
5- The denim market leaders are hopeful as they are working on new sustainable developments since the market’s growth will be driven by demand for sustainable denim fabric, and ongoing technological advancements in laser to cut down water costs.

Crude Oil:

1- Crude Oil prices opened at USD 76.92 a higher level as compared to last week’s closing figures. in this week, crude oil prices showed an upward trend and closed on the higher side by the end of the week.
2- On the last day of the week, Crude Oil prices closed at USD 79.19 with an increase of USD 2.27 cents as of the opening figure of the week.

  Opening of Week Closing Of Week Change
Price 76.92 79.19 2.27

Exchange Rate:

1- In the last week values of Pak rupee appreciated against US Dollar, and other major currencies showed mix trend in both interbank and open markets.
2- At the end of the week, the Euro closed on a positive note with a figure of 1.07 and the British Pound also closed on a positive note with a figure 1.26 against USD.

  Selling Buying
LC Sight 278.53 278.48
LC 120 Days 270.88 270.83
Open Market 282.65 276.56

New York Cotton Future:

The New York Cotton futures started the week lower than the previous week’s closing figures.
NYCF showed an upward trend and closed on the higher side.

1- On the last day of the week, MAR 2024 closed with an increase of 334 points.
2- On the last day of the week, MAY 2024 closed at with a rise of 312 points.
3- On the last day of the week, JUL 2024 closed at with a surge of 292 points.
4- On the last day of the week, OCT 2024 closed at an increase of 156 points.

Liver Pool Indices:

1- Liverpool Index A opened at 97.40 a lower level than the previous week’s closing figure.
2- In this week Index “A” showed an upward trend and closed on the higher side by the end of the week.
3- At the last day of the week, LPI “A” closed at 101.45 with an increase of 405 points.

  Opening of the Week Closing of the Week Change
Index A 97.40 101.45 4.05