With cotton prices reaching relatively high levels in a very short period of time, cotton spinners and more certainly fabric makers are facing increasing difficulties in raising their prices. .
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In China, cotton yarn prices rose in the past week after slightly falling, in line with the rebound observed on domestic cotton markets.
After reaching about 18,000 yuan per ton on October 20th, average price of grade 329 cotton fell to 17,000 yuan in the following days before rebounding to 17,500 yuan in the past week. .
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As a result, cotton yarn prices last week rose 200 to 300 yuan per ton (two to three US cents per kilo). .
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Pure cotton yarns of 21s count reached 19,800 yuan per ton (US$2.40 per kilo) on the Changyi market while average prices of 32s and 40s were 21,600 yuan and 23,700 yuan, respectively (US$2.61 per kilo and US$2.87 per kilo). .
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Such a new rise in cotton prices resulted in a new fall in orders by producers of knit apparel, hosiery and cotton fabrics. .
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Downward cotton processors meet increasing difficulties in raising their prices, being now forced reducing production to avoid a surge in losses. .
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According to a series of reports, output of cotton textiles could rapidly fall in China after a number of large mills already suspended production while others are running at about 50% of their capacities. .
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The China Textile Industry Association last month sent an emergency report to the State Development and Reform Commission SDRC) warning that a major crisis is looming with a large number of jobs “at risk”.In Pakistan, cotton prices also reached very high levels in only three weeks, resulting in closures of numerous mills, industry associations said. .
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Following a decline in cotton prices since last Thursday, cotton yarn prices would also have decreased. .
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Cotton yarn prices were up 1,300 rupees per bag in the past month, nevertheless, with no clear indication of a possible return to previous levels yet. .
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In China such as in Pakistan, long-term deals were suspended in anticipation of high volatility in prices in the coming months. .
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In Bangladesh, domestic cotton textile industry is also hurt by the recent rise in cotton prices. Local cotton yarn prices of carded 30s count rose about 25% in only two weeks from about US$2.50-2.60 to US$3.10-3.25 per kilo, the Bangladesh Textile Mills Association (BTMA) reports. .
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Prices of combed 30s were up about 20% at the same time, rising from US$3.20-3.25 to US$3.65-3.80.In India, cotton yarn prices are also rapidly increasing, boosted by stronger demand from foreign customers. .
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Indian spinners are taking advantage of relatively lower cotton prices at home than on international markets, although cotton rates sharply increased in the past weeks. .
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Cotton yarn prices were up about ten rupees per kilo (17 US cents) in the past month before being raised by another 8 to 10 rupees (17 to 22 US cents) for November deliveries. .
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According to an Indian newspaper, the bag of 50 kilos of 30s count yarn would now be sold at 6,250 rupees (US$2.76 per kilo) against 5,850 rupees a month ago (US$2.59 per kilo). .
Date:11/12/2003
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