Sri Lankan crisis dampens spirits in south Indian cotton yarn markets

A broker told Fibre2Fashion that some exporters were worried for their outstanding payments from Sri Lanka, as the government there has stopped all foreign payments, except for essential items. The south Asian island nation does not even have enough foreign exchange to meet their emergency imports.

Trade sources from Mumbai said that spot prices for cotton yarn were steady because buyers were not keen to for fresh buying. Higher cotton prices did not allow yarn prices to come down. Millers are not likely to decrease their quoted prices of cotton yarn. 60 count carded cotton yarn of warp and weft varieties were traded steady at ₹2,150-2,200 and 2,000-2,050 per 5 kg respectively,. Carded cotton yarn (44/46 count) of warp variety was traded at ₹2,040-2,080 per 5 kg. 80 count carded cotton yarn of weft variety was sold at ₹2,250-2,300 per 4.5 kg. 40 count carded cotton yarn (warp) was sold at ₹375-380 per kg. 40 count combed yarn (warp) was priced at ₹425-440 per kg. 

The knitwear hub of Tiruppur also witnessed cautious approach of buyers. Demand had dropped in second half of last week due to steep rise in yarn prices, and the Sri Lankan crisis has further dampened the already weakened sentiments. Traders said that Sri Lanka was not big factor in huge Indian textile sector, but it became crucial factor because the market is still facing poor demand. Tiruppur market also recorded steady price trend. 30 count combed cotton yarn was traded at ₹375-385 per kg, 34 count combed at ₹390-400 per kg and 40 count combed at ₹410-415 per kg. Cotton yarn of 30 count carded was sold at ₹345-355 per kg, 34 count carded at ₹350-355 per kg and 40 count carded at ₹365-375 per kg, according to Fibre2Fashion’s market insight tool TexPro.  

ICE cotton futures posted triple digit gains on Monday, supported by robust demand and supply concerns as drought conditions in major growing areas worsened. Cotton contract for May 2022 closed at 137.94 cents, up 339 points; July 2022 closed at 134.28 cents, up 335 points; December 2022 closed at 113.76 cents, up 308 points. An analyst said, “Pretty good demand was uncovered, and the continued forecast of dry weather is helping the prices.” 

In Gujarat market, cotton prices rose for the second consecutive session on Tuesday amid continued demand from mills, while daily arrivals remained steady. A grade cotton was sold at ₹91,000-93,000 per candy of 356 kg, B grade at ₹89,000-91,000 per candy and average grade cotton at ₹88,000-89,000 per candy. V797 variety of cotton was quoted at ₹48,000-50,000 per candy.

Fibre2Fashion News Desk (KUL)