Interviews
Nishat Mills posts higher sales & profit
19 May '11
5 min read
Market Review and Future Prospects
Textiles sector occupies a pivotal position in Pakistan's economy. It has a unique distinction of linking our agricultural sector (4th largest producer of cotton) through industry to exports. Today textile industry of Pakistan is facing multiple challenges internally and globally. On domestic front ever increasing production cost, uncertainty about cotton supply and prices and double digit inflation are posing a major threat to the textile industry. High energy cost and inflation have swelled up to almost twice in the last twelve months and the prolonged power and gas shut downs have made it very difficult for the textile companies to survive and compete in the international markets. On these fronts the situation is expected to remain volatile in the near future.
Our textile industry had always shown great courage in coping with these challenges. However, the worse was feared in the financial year 2010-2011, due to the loss of cotton crop as a result of unprecedented rains and floods in the country which badly affected the supply of cotton resulting in high prices of this basic raw material of the industry. During the nine months period of current year, cotton market remained very volatile and is still highly speculative. As a result both the buyers and sellers of cotton are very cautious in their decisions.
Cotton prices in the international market also reached to unprecedented levels in this period which significantly increased the cost of imported raw material. Furthermore, higher inflation in the country is another major cause of concern for this sector. In addition, the announcement of imposition of safeguard measures by government of Turkey in the form of additional import tariffs with effect from July 26, 2011 may have an adverse effect on future textile exports of the country. In this difficult time, textile sector expects a very effective measure from the Government to protect export businesses of the country of which textile sector is the biggest contributor.
Increase in demand of our products in Europe and America is a major helping factor which helped our textile sector to sail through these challenging and difficult times and to show significant growth in exports of country. However, withdrawal of import duty on our exports to Europe has not yet been effective and its impact on the export of textile sector of Pakistan is yet to be seen. A lot of efforts are in progress jointly by the Government and our textile associations firstly to ensure the implementation of already announced withdrawal of import duties and secondly to get this relaxation for more of our finished textile products.
As usual the management of Nishat Mills is keeping a close eye on the market situation and is taking proactive measures to mitigate the impact of emerging challenges. Our future marketing strategy will be to explore new markets for our products, broadening our product mix and getting maximum benefit from our vertically integrated production facilities that can turn raw cotton into a final finished consumer product.
Click here for more details
Textiles sector occupies a pivotal position in Pakistan's economy. It has a unique distinction of linking our agricultural sector (4th largest producer of cotton) through industry to exports. Today textile industry of Pakistan is facing multiple challenges internally and globally. On domestic front ever increasing production cost, uncertainty about cotton supply and prices and double digit inflation are posing a major threat to the textile industry. High energy cost and inflation have swelled up to almost twice in the last twelve months and the prolonged power and gas shut downs have made it very difficult for the textile companies to survive and compete in the international markets. On these fronts the situation is expected to remain volatile in the near future.
Our textile industry had always shown great courage in coping with these challenges. However, the worse was feared in the financial year 2010-2011, due to the loss of cotton crop as a result of unprecedented rains and floods in the country which badly affected the supply of cotton resulting in high prices of this basic raw material of the industry. During the nine months period of current year, cotton market remained very volatile and is still highly speculative. As a result both the buyers and sellers of cotton are very cautious in their decisions.
Cotton prices in the international market also reached to unprecedented levels in this period which significantly increased the cost of imported raw material. Furthermore, higher inflation in the country is another major cause of concern for this sector. In addition, the announcement of imposition of safeguard measures by government of Turkey in the form of additional import tariffs with effect from July 26, 2011 may have an adverse effect on future textile exports of the country. In this difficult time, textile sector expects a very effective measure from the Government to protect export businesses of the country of which textile sector is the biggest contributor.
Increase in demand of our products in Europe and America is a major helping factor which helped our textile sector to sail through these challenging and difficult times and to show significant growth in exports of country. However, withdrawal of import duty on our exports to Europe has not yet been effective and its impact on the export of textile sector of Pakistan is yet to be seen. A lot of efforts are in progress jointly by the Government and our textile associations firstly to ensure the implementation of already announced withdrawal of import duties and secondly to get this relaxation for more of our finished textile products.
As usual the management of Nishat Mills is keeping a close eye on the market situation and is taking proactive measures to mitigate the impact of emerging challenges. Our future marketing strategy will be to explore new markets for our products, broadening our product mix and getting maximum benefit from our vertically integrated production facilities that can turn raw cotton into a final finished consumer product.
Click here for more details
Nishat Mills Limited
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.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Telangana State Industrial Infrastructure Corporation Limited (TSllC Ltd)")
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