In the light of rise in cotton price, South Indian spinners lack pricing towards upstream
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In spite of rising cotton prices, cotton yarn prices of major varieties remained stable in Mumbai and Tiruppur markets amid poor demand from downstream industry. Though spinners were quoting yarn prices at higher levels, sluggish demand did not support any hike in prices.
Upstream businesses are also feeling the pinch of weaker demand for garments.
In the Mumbai market, 60 count carded cotton yarn of warp and weft varieties were traded at ₹1,820-1,944 per 5 kg and ₹1,620-1,680 per 5 kg respectively. 80 count carded cotton yarn of weft variety was quoted at ₹1,850-1,880 per 5kg, while 46 count carded cotton yarn of weft variety was sold at ₹1,600-1,640 per 5 kg.
“Prices remained unchanged as demand remained weak. Spinners were quoting higher prices as cotton prices went up in the last two weeks, but they were unable to raise the prices due to poor demand from fabrics,” a Mumbai-based broker told Fibre2Fashion.
Ahmedabad-based veteran businessman Ramesh Chhabaria explained the stress in the entire value chain caused by higher cotton prices. “Finished fabric buyers are not willing to pay higher prices despite price rise in grey fabric.
The price of 40/40/132/72/63" poplin went to ₹106 per metre from ₹92 per metre in just two weeks. First two weeks of January will continue to see sluggish trend, and demand is expected to rise after Makar Sankranti/Pongal (January 14) when summer clothing production will begin.``
In the Tiruppur market also, cotton yarn prices remained steady due to weaker demand. Cotton yarn of 30 count combed was traded in Tiruppur at ₹330-335 per kg, 34 count combed at ₹340-345 per kg, and 40 count combed at ₹360-365 per kg.
Cotton yarn of 30 count carded was sold at ₹292-295 per kg, 34 count carded at ₹300-310 per kg and 40 count carded at ₹330-335 per kg, according to Fibre2Fashion’s market analysis tool TexPro.
Currently, buyers are adopting a wait-and-watch policy and demand is expected to pick up after Pongal, which is a very important festival for the entire southern India.
In the cotton trade, domestic markets witnessed an upward price trend due to higher demand from spinning mills. The prices increased by ₹200-500 per candy of 356 kg each in various markets.
Meanwhile, ZCE cotton yarn January 2022 futures traded higher by CNY 5 at CNY 26,960 per ton, and May 2022 traded higher by CNY 225 at CNY 27,505 per MT today.
ICE cotton futures edged higher on Thursday on strong demand outlook. Cotton contracts for March 2022 closed at 114.34 cents, up 135 points; May 2022 closed at 111.44 cents, up 107 points; December 2022 closed at 92.29 cents, up 64 points.
Fibre2Fashion (The news article has not been edited by DFU Publications staff)
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