South Indian cotton yarn remains steady as year-end anxiety sets in

10 Dec '24

4 min read

South Indian cotton yarn remains steady as year-end anxiety sets in

Pic: Adobe Stock

Insights

Cotton yarn trade in south India, particularly in Tiruppur and Mumbai, is experiencing sluggish demand and stable prices as the year and quarter end approach.
With a looming holiday potentially stalling export activities and weakening domestic demand, the market sentiment is cautious.
Prices in Mumbai remain unchanged, reflecting tepid interest from the weaving industry.

The cotton yarn trade in south India has been experiencing year-end anxiety. Both Tiruppur and Mumbai markets have observed slow demand and stable prices for cotton yarn. Traders are cautious due to the upcoming year-end and quarter-end. A long holiday in the latter half of the current month may decelerate the entire value chain, as export demand could come to a standstill. In both southern Indian markets, domestic demand for cotton yarn has also been slow. Additionally, the demand for cotton yarn for summer garments has been weak.

In the Mumbai market, the prices of cotton yarn have remained steady as the weaving industry showed little interest in purchasing. The market is affected by year-end anxiety, which is impacting market sentiment. A trader from the Mumbai market told Fibre2Fashion, "Foreign buyers will be on holiday in the second half of this month. Importers will slow down their garment buying in the next couple of weeks. Therefore, the entire value chain is expected to see a bearish trend in the coming week. The demand for cotton yarn has already dried up due to year-end anxiety."

In Mumbai, 60 carded yarn of warp and weft varieties were sold at ₹1,430-1,470 (approximately $17.04-$17.51) and ₹1,370-1,420 per 5 kg (approximately $16.33-$16.92) (excluding GST), respectively. Other prices include 60 combed warp at ₹334-341 (approximately $3.98-$4.06) per kg, 80 carded weft at ₹1,400-1,470 (approximately $16.69-$17.51) per 4.5 kg, 44/46 carded warp at ₹258-269 (approximately $3.08-$3.20) per kg, 40/41 carded warp at ₹254-264 (approximately $3.02-$3.12) per kg and 40/41 combed warp at ₹284-291 (approximately $3.37-3.46) per kg, according to trade sources.

In Tiruppur, knitting cotton yarn prices were stable due to average demand, though trading activities were slow in the southern market. Traders mentioned that summer demand has yet to pick up in the southern states. The falling ICE cotton prices are also discouraging buyers from making new purchases. The market can expect an improvement in demand only in the next month.

In Tiruppur, knitting cotton yarn prices were noted as 30 count combed cotton yarn at ₹257-265 (approximately $3.03-3.13) per kg (excluding GST), 34 count combed cotton yarn at ₹266-273 (approximately $3.14-3.22) per kg, 40 count combed cotton yarn at ₹277-287 (approximately $3.27-3.39) per kg, 30 count carded cotton yarn at ₹236-241 (approximately $2.79-2.85) per kg, 34 count carded cotton yarn at ₹241-243 (approximately $2.74-2.88) per kg and 40 count carded cotton yarn at ₹249-254 (approximately $2.95-3.01) per kg.

In Gujarat, cotton prices were stable amid average demand from spinning mills. Traders reported that cotton prices did not experience any significant movement, as mills are purchasing cotton for their regular needs. Demand from the downstream industry was not encouraging. It is unlikely that cotton prices will see an upward trend in the near future. These factors are discouraging mills from making larger purchases. Domestic cotton prices remained steady despite the easing of ICE cotton prices and slow demand. Cotton procurement by the Cotton Corporation of India (CCI) is providing support to market sentiments. Cotton arrivals were estimated at 32,000-35,000 bales of 170 kg in Gujarat and 200,000-220,000 bales in the country.

The benchmark Shankar-6 cotton was quoted between ₹54,000-54,300 (approximately $637.69-$641.23) per candy of 356 kg, while southern mills were looking to buy cotton at ₹54,700-55,000 (approximately $644.78-$649.50) per candy. Seed cotton (kapas) was traded at around ₹7,400-7,500 (approximately $87.39-$88.57) per quintal.