The easiest trend in the cotton market - Business Recorder

The easiest trend in the cotton market – Business Recorder

Lahore: Wednesday’s local market was easy and trading volume remained low. Cotton analyst Naseem Othman said the cotton rate in Punjab and Sindh ranges from Rs 21,000 to Rs 22,000 per piece. He also said that Cotton and Voti rates saw a drop of Rs 1,500 in two days.

New Kappas from Pengriyo, Samaro were sold at Rs 9000, New Kapaas from Chor Jamali had rate between Rs 9000-9100 and Tando Bhago rate was between Rs 8800-9000. The rate of Kappas of Digri, Kunri was Rs 8800-9000 while that of Mirpur Sakharo, Gharo and Ubaro was Rs 8500-8800 and Gularchi, Berani, Kadhan and Badin was Rs 8800-9000.

The All Pakistan Textile Mills Association (APTMA) urges the government to continue to apply regional competitive tariffs for the entire value chain and not to impose any non-tariff barrier on raw materials or spare parts for the industry.

Textile and apparel exports increased 23 percent year-on-year to $15.4 billion in 2020-2021, compared to $12.5 billion in 2019-20. Textile exports grew 26% in the first 10 months of this fiscal year, from $12.7 billion to $16 billion. Moreover, by the end of the fiscal year in June 2021-June 22, apparel and textile exports are expected to make a significant contribution of $21 billion in supporting the balance of payments deficit.

Textile exports are expected to increase to $27 billion in the next fiscal year as a result of new capacity installed through TERF & LTFF over the past year.

Moreover, there is speculation that the government is considering non-tariff barriers (NTBs) through a voucher scheme to reduce imports of raw materials. The impact of any non-tariff barrier on imports of raw materials would be disastrous.

Changing / ignoring the winning formula can lead to very negative results. Regional Competitive Energy Tariffs (RCETs) across the value chain, as well as the unrestricted import of raw materials and spare parts for export, are essential to rapidly increasing textile exports.

The increase in interest rates is a toxic killer for the industry, said Mian Kashif Zia, president of PHMA (Northern District) and heads and representatives of other textile associations.

Mian Kashif Zia said that in order to increase the country’s exports, the value-added textile sector should be given equal facilities as competing countries, and it was necessary to continue the electricity and gas policy initiative at special prices. Mian Kashif Zia, President of Pakistan Hosiery Manufacturers and Exporters Association (Northern District), said all the traders and industrialists in the city described electricity, gas and other issues as a greater threat to the value-added textile sector than Corona. He said this while speaking at a press conference in his office.

Atif Munir Sheikh, President of FCCI, Jawad Asghar, Chairman of the Board of Directors of the Spinning Association, Shehzad Ahmed Abuma, Amir Ahmed, Vice Chairman of the Board of Directors of PTEA, Rana Abdul Ghafoor Embroidery Association, Khurram Akhlaq, President of the Power Loom Association, Waheed Khaliq Rami, President of the Power Loomzoners Association, Chaudhry Salamat Ali Ex-Central PHMA President, Dr. Khurram Tariq Ex-Central PHMA President, Syed Zia Alamdar, Ex-Chairman of PHMA, Mian Farouk Iqbal, Ex-Senior Vice President of PHMA, Hafez Rashid Mahmoud and other industrialists, businessmen and executive members of PHMA.

Mian Kashif Zia said that in order to increase the country’s exports, the value-added textile sector should be given equal facilities as the competing countries. He said that it is important to continue the policy of electricity and gas at special prices. If this is not done, not only will the industry shut down, but millions of workers will also become unemployed. He said that in order to get rid of external debt, value-added textile exports should be increased to avoid the dictation of the International Monetary Fund.

Atif Munir Sheikh, Chairman of Faisalabad Chamber of Commerce and Industry, said the government should take our problems seriously and solve all problems in the textile sector as soon as possible. He said that we do not have a political agenda but we want to boost the sinking economy by increasing the country’s exports and for this it is necessary to take all stakeholders in confidence.

Waheed Khaliq Rami, president of the Power Loom Owners Association, said our industry is on the verge of closing. If the current government doesn’t lower electricity prices, not only workers, but landlords as well, will be on the streets.

Shakeel Ansari, Chairman of the Board of Directors of the Sizing Association, said that the prices of our raw materials doubled even before the rise of the dollar, and it became very difficult to do business in such conditions. He said the government should immediately announce a easing of the textile industry in consultation with all stakeholders.

Dr. Khurram Tariq, the former Central Head of PHMA said that we are not seeking any support from the government for electricity and gas, but that electricity and gas should be provided to the textile sector at their cost. The burden of non-refunds rests entirely with our industry, he said. This raises the price of electricity and gas for industry and our industry bears the entire burden.

Moreover, ICE cotton futures were little changed on Tuesday, but were headed for their biggest monthly decline in more than two years under pressure from the strong dollar and forecasts of rain in key growth regions in West Texas.

Cotton contracts for July were down 0.27 cents, or 0.19%, at 139.15 cents a pound at 1:29 PM ET. It traded between 139.05 cents and 142.00 cents per pound. The contract is down 8.6% so far this month.

“It looks like there is more rain in the forecast for West Texas and the US dollar is rising today,” said Keith Brown, director of Georgia cotton broker Keith Brown and Co.

The US dollar rose across the board as rising Treasury yields and concerns about another acceleration in global inflation kept investors’ appetite for risk at bay. US dollar oil prices extended to the upside as the European Union agreed to a partial and gradual ban on Russian oil and China decided to ease some COVID-19 restrictions.

Higher oil prices make polyester, an alternative to cotton, more expensive. China cotton futures on the Zhengzhou Commodity Exchange rose 0.6% to 20,515 yuan per ton.

Chicago wheat futures tumbled after Russian President Vladimir Putin expressed his willingness to allow banned Ukrainian grain ships from Black Sea ports. The spot rate remained unchanged at Rs 22,500 per mile. Polyester fibers were available at Rs 305 per kg.

Copyright Business Recorder, 2022

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