The Hindu Business Line : Spurt in cotton yarn prices leads to export slowdown

THE runaway increase in cotton yarn prices seen in the last one month seem to be headed for a temporary halt as yarn importers from Korea and Hong Kong have stayed away from active purchases from India for now.With no appreciable fresh orders received from these two key South-East Asian markets in the past 10 days, the export price of yarn is said to be sobering. The yarn-exporting textile units in consonance with this development are said to have lowered the prices by five cents to 10 cents a kg over October prices, yarn/cotton market sources said.

The sources told Business Line that imports from Hong Kong and Korea had slowed down and no new letter of credit had been opened in the last 10 days by them forcing marginal scaling down in prices by exporters.

One reason for the export slowdown, according to these sources, is that these importers have fully covered their needs for DecemberThe sobering yarn market seems to have cast its shadow on the rallying raw cotton market as well. The temporary halt in yarn exports has put brakes on the spiralling cotton prices. For the last two days, the domestic market prices has been quoting Rs 500 - Rs 1,000 lower, compared with the mid-October 2003 prices. For example, the much in demand Sankar-4 cotton is quoted at Rs 22,800 - Rs 23,000 per candy compared with the Rs 24,000-quote of last month.

Although the export yarn price trend has been having a strong bearing on the domestic raw cotton prices in recent times, part of the sobriety seen in the cotton prices this week is, however, attributed by most cotton traders to the increased arrivals of the new crop at major terminal markets. They say that the daily arrival has hit the 80,000/one-lakh bale levels since the beginning of the week.

A section of the yarn market believes that the slowing down is only temporary and the export market will heat up soon.

Article E-Mail :: Comment :: Syndication

Stories in this Section
Safeguard duty mooted on Bisphenol A

CAG forwards Kerala's finance accounts

Shrinking Vembanadu Lake poses a threat

Mauritius seeks Indian funds in tourism, textiles sectors

Foreign trade seminar in Hyderabad

Surge in occupancy levels of Mumbai hotels

Power leaks thru the remote control

AP power position improves

CST bill: Finance Ministry move to hit Reliance

Happy valley garden look unhappy