In the past week, the price of domestic cotton yarn in Pakistan continued to fall, consistent with the price trend of domestic and foreign cotton and polyester staple fiber. In contrast, Pakistani yarn export quotations have increased as Chinese demand is expected to increase driven by the China-Pakistan Free Trade Agreement.
Pakistan’s 30-count carded yarn fell by 1.48% that week, with a cumulative decline of 4.32% in the past four weeks. Domestic yarn demand is generally weak and transactions are quite sluggish.
At the same time, driven by strong import demand from China and Europe, Pakistan’s yarn export prices have increased. There is huge demand from Chinese buyers for spot shipments before the Spring Festival.
The second phase protocol of the China-Pakistan Free Trade Agreement will take effect on January 1, 2020. At that time, Pakistani textiles and clothing (including cotton yarn) exported to China will enjoy zero tariffs. Affected by this, the export price of Pakistani yarn increased by 2-3% in the past week.
Pakistan’s domestic cotton prices remain low. Due to the severe shortage of domestic high-grade cotton supply, spinners have no interest in purchasing domestic cotton and are focusing on imported cotton. Karachi spot price index fell to 8,900 rupees/maud.
