The textile industry utilisation levels remain a concern globally and hence, any spurt in cotton prices would certainly tell on industry profit margins. The local cotton market on Thursday remained easy and the trading volumes were low because of hesitance from mills as the cost of producing yarn is higher than the sales price. Because the activity in cotton market is low and ginners also have limited stocks, cotton is being offered in both Punjab and Sindh between Rs 19,000 to Rs 21,500 per maund. Phutti prices in Punjab were observed between Rs 8,500 and Rs 10,000 per 40 kg.
The slowness of the market can be judged by the fact that on Thursday only 524 bales of Khair Pur were sold at Rs 20,200 per maund. The Karachi Cotton Market Spot Rate remained unchanged at Rs 21,500 per maund. Polyester Fiber was available at Rs 367 per kg.
In other parts of the world the retail price range for Australian cotton is between US$ 4.06 and US$ 8.71 per kilogram or between US$ 1.84 and US$ 3.95 per pound(lb). The retail price range in Australian Dollar for cotton is between AUD 6.10 and AUD 13.10 per kilogram or between AUD 2.77 and AUD 5.94 per pound(lb) in Canberra and Melbourne. The retail price range for Vietnam cotton is between US$ 1.43 and US$ 2.38 per kilogram or between US$ 0.65 and US$ 1.08 per pound(lb). The retail price range in Dong for cotton is between VND 35,771.25 and VND 59,618.75 per kilogram or between VND 16,222.79 and VND 27,037.98 per pound(lb) in Hanoi and Ho Chi Minh City. The retail price range for Cambodia cotton is between US$ 0.25 and US$ 0.44 per kilogram or between US$ 0.11 and US$ 0.20 per pound(lb). The retail price range in Riel for cotton is between KHR 1,028.13 and KHR 1,850.63 per kilogram or between KHR 466.27 and KHR 839.29 per pound(lb) in Phnom Penh and Siem Reap. The retail price range for Indonesian cotton is between US$ 0.87 and US$ 1.16 per kilogram or between US$ 0.39 and US$ 0.52 per pound(lb). The retail price range in Rupiah for cotton is between IDR 14,460.00 and IDR 19,280.00 per kilogram or between IDR 6,557.82 and IDR 8,743.76 per pound(lb) in Jakarta and Surabaya.
The retail price range for Turkey cotton is between US$ 2.46 and US$ 3.69 per kilogram or between US$ 1.12 and US$ 1.67 per pound(lb). The retail price range in Turkish Lira for cotton is between TRY 48.75 and TRY 73.12 per kilogram or between TRY 22.11 and TRY 33.16 per pound(lb) in Ankara and Istanbul. The retail price range for Portugal cotton is between US$ 2.27 and US$ 5.76 per kilogram or between US$ 1.03 and US$ 2.61 per pound(lb). The retail price range in Euro for cotton is between EUR 2.10 and EUR 5.32 per kilogram or between EUR 0.95 and EUR 2.41 per pound(lb) in Lisbon and Porto. The retail price range for Italy cotton is between US$ 8.57 and US$ 23.82 per kilogram or between US$ 3.89 and US$ 10.80 per pound(lb). The retail price range in Euro for cotton is between EUR 7.92 and EUR 22.01 per kilogram or between EUR 3.59 and EUR 9.98 per pound(lb) in Rome and Milan. The retail price range for Spain cotton is between US$ 3.45 and US$ 4.43 per kilogram or between US$ 1.56 and US$ 2.01 per pound(lb). The retail price range in Euro for cotton is between EUR 3.18 and EUR 4.09 per kilogram or between EUR 1.44 and EUR 1.86 per pound(lb) in Madrid and Barcelona.
The retail price range for Bangladesh cotton is between US$ 0.92 and US$ 1.62 per kilogram or between US$ 0.42 and US$ 0.73 per pound(lb). The retail price range in Taka for cotton is between BDT 98.78 and BDT 173.90 per kilogram or between BDT 44.80 and BDT 78.87 per pound(lb) in Dhaka and Chittagong (Chattogram). The retail price range for Philippines cotton is between US$ 3.11 and US$ 5.26 per kilogram or between US$ 1.41 and US$ 2.39 per pound(lb). The retail price range in Philippine peso for cotton is between PHP 173.03 and PHP 292.81 per kilogram or between PHP 78.47 and PHP 132.80 per pound(lb) in Manila and Quezon.
In India domestic cotton prices jumped by 10-12 per cent in the last two weeks. India prices toe the trend in global cotton prices which rose recently The problem is that demand for textiles in global markets is not seeing a rebound. Domestic demand uptick was not as expected even during the last festive season, although home textiles are doing better than apparel ITMF survey in January shows weak demand internationally but an improvement in business sentiment is missing. Unless demand is sustainable, textile makers and spinning mills will remain on edge.
In Australia growers were expecting a long, hot and dry summer forcing a crop revision below 4 million bales. The rains across largest growing areas were very welcome and now they are expecting at least 4.5 million bales which will result in more than $3.6 billion for the Australian economy, much of which will flow back into rural and regional communities. By mid-March, Australia’s 1,500 cotton growers had either started to pick their 2024 crop or were planning to start in the coming weeks, according to a statement from industry representative body Cotton Australia. It said farmers were confident of another above-average season. For this season, farmers in Australia have planted cotton on 480,000 hectares of land,
In the United States May futures finished the week ending March 7 limit-up after trading lower early in the week. Profit-taking and corrective action caused the early week decline, sending the front months in cotton limit-down at one point. Trading ranges were wide, but cotton news was quiet overall in anticipation of the WASDE report. May futures had another week of volatile trading but eventually settled at 99.28 cents per pound, down 29 points for the week. Despite the losses early in the week, total open interest added 1,956 contracts, increasing to 272,742. Certificated stocks were reported at 20,886 bales, reaching the highest level since December.The U.S. balance sheet tightened when production was cut 330,000 bales to 12.1 million bales on Friday’s estimates of supply and demand (WASDE report).
U.S. exports were unchanged at 12.3 million bales, but the cut to production caused ending stocks to decrease by 300,000 bales to 2.5 million bales. World consumption increased 480,000 bales to 112.94 million bales. The global balance sheet tightened up as well. World ending stocks decreased by 360,000 bales to 83.34 million bales.
The stock market recorded another week of significant gains, building on recent rallies. Fed Chairman Jerome Powell testified before Congress this week, saying they have gained greater confidence that inflation is moving in a sustainable direction. The European Central Bank held interest rates steady, but it is speculated they could cut them this year. The S&P 500 hit a new record, fueled by interest rate expectations and a slew of jobs data.Congress was poised to pass a funding package on Friday that will provide funding to six departments, including agriculture. The Labor Department reported that U.S. employers added 275,000 jobs in February, a signal that the labor market remains robust. The U.S. unemployment rate rose slightly by 0.2 percent to a rate of 3.9 percent but remains low historically.
Demand for U.S. cotton is still weak, but the Export Sales Report for the week ending February 29 was relatively good overall. A net total of 52,000 Upland bales were sold. With the recently higher prices, many did not expect this week’s sales to be higher than the 40,000 reported last week. Bangladesh was the biggest buyer, booking a total of 34,300 bales. Cancellations of 60,000 bales, mainly from China and Pakistan, were a noticeable feature in the report. A total of 330,800 Upland bales were exported, surpassing the pace needed to reach USDA’s export estimate. A net total of 11,100 Pima bales were sold, and 6,400 bales were shipped for the week. New crop sales of 15,100 Upland bales increased from last week but are below average for this time of the year. Now that planting has started in South Texas, weather will become the central focus as many traders’ attention has begun to pivot to next season’s crop. From a fundamental standpoint, next week should be quiet in the cotton market. The weekly Export Sales Report and growing certificated stock will continue to be monitored.
