Mixed trend in north Indian cotton yarn market, cash flow improves

28 Mar '24

4 min read

Pic: Adobe Stock

Insights

North Indian cotton yarn market has shown mixed trends.
Ludhiana's market remained steady, while Delhi experienced an increase in prices.
Panipat saw stability in recycled yarn prices despite sluggish demand.
The implementation of Section 43B(h) initially dampened market sentiments but later improved payment flows to micro and small enterprises.

The north Indian cotton yarn market has experienced a mixed trend. Ludhiana observed steadiness amid slow demand due to the closing of the current fiscal 2023-24 (FY24), while Delhi noted a rise of ₹2 per kg for most counts and varieties because of improved demand and liquidity. Panipat also witnessed stability in recycled yarn due to slow demand. Though Section 43B(h) dampened market sentiments, it also led to better payment flow after the clearance of outstanding payments to micro and small enterprises within this fiscal. Experts expect a rebound in the next fiscal that begins on April 1.

Cotton yarn prices gained ₹2 per kg in Delhi due to improved demand. A trader from this market, speaking to Fibre2Fashion, mentioned, "There was good demand for cotton yarn. Probably, the easy flow of payments has encouraged buyers to engage in new cash deals. Summer demand was visible in the market. There are expectations of better buying in April."

In this market, 30 count combed yarn traded at ₹280-283 (approximately $3.36-3.39) per kg (GST extra), 40 count combed at ₹305-310 (approximately $3.66-3.72) per kg, 30 count carded at ₹255-260 (approximately $3.06-3.12) per kg, and 40 count carded at ₹282-285 (approximately $3.38-3.42) per kg today, according to Fibre2Fashion's market insight tool TexPro.

In Ludhiana, cotton yarn prices remained unchanged as well. The market noted minimal trade because both buyers and sellers were reticent about engaging in new trades. A Ludhiana market trader told F2F, "The absence of buyers has been notable. The consumer industry, stockists, and exporters are busy closing the books at the end of the current fiscal. However, demand is expected to pick up next month as buyers who have postponed their purchases this fiscal will likely increase buying."

In Ludhiana, 30 count cotton combed yarn was sold at ₹274-284 (approximately $3.29-3.40) per kg (inclusive of GST); 20 and 25 count combed yarn traded at ₹263-274 (approximately $3.15-3.29) per kg and ₹270-280 (approximately $3.24-3.36) per kg, respectively; and 30 count carded yarn was noted at ₹254-261 (approximately $3.05-3.13) per kg today, according to TexPro.

Stability persisted in Panipat's recycled yarn market as well. Traders expect demand to improve in the next month when buyers return with fresh trade strategies. Prices for recycled yarn remained stable over the last couple of weeks.

In Panipat, 10s recycled PC yarn (Grey) was traded at ₹76-80 (approximately $0.91-0.94) per kg (GST paid). Other varieties and counts included 10s recycled PC yarn (Black) at ₹51-54 (approximately $0.61-0.65) per kg, 20s recycled PC yarn (Grey) at ₹88-93 (approximately $1.06-1.12) per kg, and 30s recycled PC yarn (Grey) at ₹125-130 (approximately $1.50-1.56) per kg. Cotton comber prices were recorded at ₹120-122 (approximately $1.44-1.46) per kg. Recycled polyester fibre (PET bottle fibre) was noted at ₹70-72 (approximately $0.84-0.86) per kg today, according to TexPro.

North Indian cotton prices remained low due to sluggish buying from spinning mills, MNCs, and traders, with prices dropping ₹20-30 per maund of 37.2 kg. The market observed a slower arrival of cotton at the end of the current season, recording 6,000 bales of 170 kg. Trade sources noted that most buyers were inactive due to the fiscal year-end.

Today's arrivals were noted at 6,000 bales of 170 kg, with state-wise arrivals reported as 500 bales from Punjab, 2,500 bales from Haryana, 2,000 from upper Rajasthan, and 1,000 from lower Rajasthan. In Punjab, cotton prices ranged from ₹5,975 to ₹6,025 (approximately $71.64-72.24) per maund of 37.2 kg, while in Haryana, they ranged from ₹5,925 to ₹6,025 (approximately $71.04-72.24). Cotton in upper Rajasthan was priced between ₹5,850 and ₹6,050 (approximately $70.14-72.54) per maund. Bikaner line cotton was sold for ₹6,050 to ₹6,125 (approximately $72.54-73.43) per maund, and in lower Rajasthan, cotton was priced at ₹57,200 to ₹59,200 (approximately $685.79-709.77) per candy of 356 kg.