Ginners appeared miserly in offering quality lots being confident of short crop while consumers laid hands of a few available lots during the week ended on April 29, 2006. The spot rate was paid respect which was left unchanged at Rs 2425 though in ready prices fluctuated according to the quality of the lint on offer.
WORLD SCENARIO: The dry spell in larger cotton growing areas in the US kept players pretty concerned and developing perception futures were to get boost. The July was down at 52.11 and December down at 56.30 cents a pound, while closing was characterised by speculative sales pushing futures down as trade mulled the next price move now that the spot May contract is into its delivery period.
Traders said that delivery being on the way trade will soon be turning to severe dry spell gripping large swathes of the US cotton belt. There is still a little time they said, they will need to put in a weather premium for this crop soon. The market will also be waiting to get another look at robust cotton demand in the weekly export report on Thursday.
On Tuesday speculative selling was repeated but solid trade and consumer buying stopped from bigger losses. Fundamentally cotton industry analysts said fibre futures are paying close attention to the severe dry spell and for quite long time. The export sales report was also very much in players view.
On Wednesday futures got a boost from trade buying and speculative short covering sparked the market.
It was a rebound after hitting a new lifetime low. The market however still awaited weekly export sales report and a sudden change in wealthier in Texas and south-west US. The uncertainty has restrained futures to move in normal and natural course.
On Thursday futures showed weakening trend due to steady speculative and options related sales traders said. Analysts said the cotton market did not really provide any inspiration although it may have encouraged further attempt to build a base near its recent lows. The weekly report on exports said they reached 336,000 RBs up from last week's.
China remained top buyer at 258,700 RBs while 235,400 RB shipped to Asian joint. China's rate hike noted by other businesses was of little consequence for cotton on Friday futures were higher July at 51.72 and December up at 55.85 cent a pound.
LOCAL TRADING: The spinners and textile millers looked eagerly for some quality lots to make part of inventory but ginners with perception that prices would shot up due to short crop were holding premium but back. The intoxicated consumers who had good share of the TCP float expected to see ginners taking their turn. But the ginners were reluctant and hence the prices were not being budged. Hardly 10,000 bales were lifted during the week's trading.
However, the opening day signalled the situation to linger on during the week. Merely 4000 bales could be picked up as fine lint was not offered. The ginners were holding whatever reserves of the cotton they had. What would be the real position of the cotton trading was still some days away. The spot rate was kept unchanged at Rs 2425 while in ready prices ranged above spot owing to quality.
The second day was worst from trading point of view. The spinners were tired looking for fine types but were not being offered. Only 1400 bales were lifted.
The Wednesday session was somewhat better, though prices had not attained the level of restraining buying.
The adamant ginners were holding both the lint and prices. Their perception was that now TCP had not been left with good stock to be a threat to ginners own. Hence they pooled their courage to wait for a favourable moment which does come suddenly.
On Thursday movement and pace in buying was apparent. The spinners and textile millers sought to lift all the available cotton. The ginners were not avoiding sales if there were chances to do that. The spot was unchanged to show flexibility in ginners thinking for obvious reason - the TCP has floated yet another tender for 32,000 bales. Ginners felt they had come under pressure and offered around 10,000 bales to the consumers. They asking prices ranged between Rs 2250 and Rs 2475 depending on quality. However, the market operators were of the opinion that ginners were cautious and releasing cotton of quality that textile millers use for mixing.
On Friday no business deal was reported as ginners not interest in setting.
On Saturday sluggish business was witnessed as mills and spinners choose to stay on sidelines waiting for the outcome of TCP tender.
IGATEX: COULD IT BE AN EYE OPENER?The Italian Trade Commissioner Dr Marco Pintus could not but speak the truth that Pak textile and clothing sector globally had made the country world's most important, tarry a bit, as you are mistaken not most important centre of purchase of cotton products of all shape, size, and tastes, but according to Pintus market of textile machinery. It would be consoling if that statement should have followed by such expression that such large spinning textile fabrics and garment manufacturers should have made bid to rid them from perennial dependence on machinery made in not-in-Pakistan.
How proudly Dr Pintus recalled his country had developed a distinctive ability to manufacture high tech textile machinery for every stage of manufacturing process.
The last few words "for every stage of manufacturing process." Appear a clarion call from distant half-a-century tunnel getting now blurred and inaudible. Has Italy 50 textile producing units to employ machinery and produce knitwear, value-added products and garments. The sources watching and hearing all about Igatex 2006-laughed when asked to express. The eyes instantly fell on the world map gotten from BR 2006 diary and on Pakistan and Italy, the latter was certainly half the size of Pakistan.
More than 50 textile machinery manufacturers or their representatives are employing all knowledge of salesmanship to dispose of machinery accompanied them and now being exhibited at the Igatex 2006 at Expo Centre. According toe reports local spinners and textile millers are rushing and rubbing bodies to have a pleasing look stuffs Pakistan perhaps would venture in itself. Dr Pintus boosted at one stage and rightly so that Italy was one of the very few countries in the world having centuries old textile tradition.
There was nobody there to boast at the venue that Pakistan has been proudly producing contaminated cotton for centuries, sources said adding that God gave us insight to move with time and development and needs. The installed machinery were collected from mills or had been for sale was not known but despite on show for a couple of days sales figures were not released.
BD TEX EXPORT BOOM: Bangladesh has placed textile exports at a respectable level if not equalled or excelled its jute and jute goods products. This is despite the fact that they are deprived of given quality cotton like Pakistan. Today meek voice though is heard that cotton and cotton products be replaced by some other knowledge based sector.
The cotton growers cannot look back with satisfaction so long opportunities ahead due to WTO rules and LDC status the BD knitwear exporters are aspiring to more than double the export earning to six billion dollars. During the 2005-06 it had earned more or less four billion dollars.
The exporters are promoting government for working on ways to enhance knitwear exports such as launching exhibitions abroad besides other facilities to avail fully the opportunity particularly US market boom. That has opened up a whole world of trade, they said, adding exports to US market have more than doubled.
The irony is that just the contrary is the picture in Pakistan where knitwear units have been declared sickly and was unlikely to recover on their own. A lot of new opening is being hanging ahead in textile cities, textile towns etc. The government is planning things to enhance the exports.
It would be good enough to brought in new but knowledgeable people to set up new units with assurance from them that the units will be kept alive with profit money. In Bangladesh exporters realise that globalisation has posed new challenges therefore they accept that there is for them no option but to raise the quality of their products. The two things count in the way of open competition let loose by WTO rules.
The BD exporters look for government help like exporters in Pakistan what government here is thinking for boosting the depressing knitwear unit is apparently a guarded secret. In Bangladesh knitwear exporters are asking for 15% subsidies to compete India which according to reports get from its government 25pc. What the exporters there also bother is about improvement in conditions in work place to remain in focus in the export sector which they appreciate is today one of the major criteria for international buyers.
TECH TEXTILE INDUSTRY: Thank God China is offering half a century old textile industry technical textile industry to create history in this country. Could, however, anybody tell how long back technical textile industry dropped from the blues? This is happy occasion and happy news, which needs to be celebrated.
Yet another welcome mention is that textile sector has been extolled to any high after being suggested that this lame duck is going to adequately pumped with requisite material by the Pak government and the Chinese investment and technical know-how will lead to prosperity, a dream so far.
Day dreaming had come to stay some decades back with cheap offer of spinning machine during late Ziaul Haq but it seems likely to help break a "down." A long wait appears to end and tired people of wait will celebrate.
China had all along been inviting, that is much before January 1, 2005 to join hand and shake hand and all such things to bay the country appears to have been accepted by the govt of Pakistan, the watchful knowledgeable circles said adding but investment will not come as "grant." As the talk of prosperity is floated in the atmosphere all should keep in mind investment is subject to.
They pointed out that our friend who is going round the world signing (or even without signing) BITs, has subjected us to ensure that huge investment will come as a result of the BIT, (subject to be inked, though for a couple of years it has been on the talking table) all investment will be wrapped up (reason not given) and Pakistan will have to return. Poor Pakistan will under the circumstances be weaker more than what prosperity and strength "huge" investment will ensure.
Pakistani authorities and manufacturers and exporters must pay heed to what Kahti Hay Khalq-e-Khuda Ghaibaniakia? He is definitely nobody but a former finance minister of Pakistan retired as World Bank official last week while taking to SBP Governor Dr Shamshad Akhtar at Washington forum warned that Pakistan was facing symptoms that preceded the Mexican financial crisis during 90s. a number of projects have been started which is under implementation, though pace remains usual low; such as Karachi, Faisalabad and Lahore but progress is far from being optimist. The knitwear industry has suffered fatal injury reasons for which will never be known, at least there is no any precedence!
TAIL PIECE: Whether time for cleaning the KB canal from April 15 to 30, was imperative should have been in knowledge of superintendent engineer of Paghar Circle Hyderabad. But the fact that according the exporters of textile products is peak shipment period.
That will mean textile millers will have to pay for water need Rs 22.5 million and country will suffer to lose foreign exchange, as production setback will occur. Thus two things come up. The time to clean KB canal should have been alone earlier or should have extended to some other time.
In either case the textile exporters should have been consulted who should have come without possibly convenience to all quarters. What is not understood why this time was fixed for the cleaning.
Is this annual feature or is done on the whims of authorities? There is in all fields lag in co-operation and co-ordination whether it is a matter of laying phone or gas connections or supply of water. The entire city looks devastated all the year round thus losing whatever beauty is achieved. New ideas are emerging for tackling things/issues in a pragmatic way let it be the roads laying of cables and cleaning canals.
Had it been a case with India then, it would be in the fitness of things that small/local problems should be amicably settled and keeping sufficient time in hand. It is most likely authorities and likely victims had solved the issue saving the exporters and their contracts.
The solution should be such that it does not prove short- lived but give that permanent shape. Approaching the govt for everything is, according to the experts, not appropriate. Or pointing out with any big or small problem with disturbance the workers fail-layouts or going out of jobs.
Government indeed, is there to tackle problems of businessmen, exporters and general public. But the size of the issues and problems should command an authority will enormous powers. With that the experts said the govt also needs general public, businessmen and exporters to increase its liquidity to help them in return. How all of us know, they said.
The cotton growers have been advised to heed it and adopt latest technology to reap maximum harvest. The appreciation is due mainly because the advice has come with material offer. Such as what is called PB-ROPE I (sex pheromones). The technology a one-day training seminar organised by proper department has already been tried and has yielded better results.
The Director General Agri Extension said that the technology is alternative source of pesticides and component of the IPM under which growers can increase their per acre yield from three to five maunds without using any pesticides. Another good point of the PB-ROPE was that its chemical free perfumed PB-ROPE with quality of easily keeping cotton fields free of any disease after 35-40 days of sowing.
The agri proposes to lay down demonstration plots of 100 acres each of such technology on the growers fields to prove minimum attack of pink ball worm and get - dirt free good quality lint and seeds.