Financial Daily from THE HINDU group of publications
Friday, Jan 09, 2004
Industry & Economy
Yarn exporters' bid to cash in on firm enquiries
Coimbatore , Jan.8
SPINNERS are keen to make use of the prevailing favourable export market for cotton yarn as enquiries for coarse/medium combed yarn from Hong Kong and Korea-based trade, catering to the Chinese textile industry, continued to remain firm for the past one week.
Import enquiries from the South East Asian markets have kept up the Indian yarn exporters spirits up for the weekwhich do help Indian yarn shippers get a moderately higher price quotes for their supplies over the mid-December prices, the local cotton and yarn trade sources said.
Yarn exporting mills do manage to get at least 10 cents more per kg for combed cotton of 30s and 40s count shipments over their mid-December prices and most of the shippers have already booked their January and February supplies for export market, the sources told Business Line.
With the SE Asian markets heading for holidays on account of the Lunar new year celebrations between January third-week and February first week, Indian yarn exporters are busy making good of the occasion and rushing their shipments. The firming yarn exports continued to exert pressure on the domestic yarn sale with most mills keen to complete their export commitment first.
It is said that the local yarn markets that cater to the powerloom/handloom weaving clusters in Tamil Nadu are not getting the requisite amount of cotton yarn allotment from the mills in view of the latter's preoccupation with exports.
Although there has been no price increase announced for the yarn allotted for January, traders say the supplies from the mills are not smooth either with the latter not showing keenness in maintaining the deliveries for the local trade.
On the other hand, the textile industry sources maintain that raw cotton supply scenario is not that encouraging as the prices of the popular varieties continue to rule firm this week in view of the staggered supplies of cotton released from the ginneries.
Most spinners eyeing the yarn exports have started building up their raw cotton buffer as delay in procurement would expose them to the quality deterioration in raw cotton in the coming weeks, which may jeopardise exports.
The cotton prices in the international market ruling far higher than the indigenous cotton, the spinners priority seems to be covering raw cotton to the extent possible than concentrating on selling yarn.
The cotton price, meanwhile, has spurted once again in the last one week amidst reports of fresh export quotas being opened by various textile export promotion bodies by next week.
The cotton price spiral is also related to the additional quantity of quotas over the annual ceilings, which would mean more demand for raw material and intermediary products like cotton yarn in the coming weeks.
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