South Indian cotton yarn prices may bottom out soon, demand to improve

South India's cotton yarn prices have remained steady amidst reduced demand from the downstream industry. The Mumbai and Tiruppur markets experienced subdued demand as weaving activities were only partially operational following Diwali. However, trade sources anticipate that weaving and garmenting activities will fully resume at the start of December. This upturn is expected to boost garment production for the summer season, stimulating demand for cotton yarn. Consequently, the market predicts a rise in cotton yarn prices soon, with buyers likely to stock up in anticipation. 

The cotton yarn prices in the Mumbai market have remained steady, despite subdued demand from the downstream industry. According to trade sources, buyers are exercising caution in new purchases due to partial operations in the weaving and garment industries. A Mumbai trader informed Fibre2Fashion, "Demand improved slightly on Monday, but it waned today as the weaving industry has only partially resumed operations post-Diwali. No more than 50 per cent of units have begun production, hindered by slow demand and a lack of workers. However, it is expected that mills will ramp up to full production next month." 

In Mumbai, 60 carded yarn of warp and weft varieties was sold at ₹1,400-1,420 and ₹1,275-1,330 per 5 kg (excluding GST), respectively. Other prices include 60 combed warp ₹315-322 per kg, 80 carded weft ₹1,400-1,440 per 4.5 kg, 44/46 carded warp ₹254-259 per kg, 40/41 carded warp ₹238-244 per kg, 40/41 combed warp ₹262-266 and 30/32 carded warp ₹227-232 per kg, according to Fibre2Fashion's market insight tool TexPro. 

The Tiruppur market has also observed stability in cotton yarn prices, attributed to the sluggish demand from the weaving industry. A Tiruppur trader explained to Fibre2Fashion, "We anticipate improved demand next month, as the summer season will likely boost the weaving industry's need for stockpiling raw materials. However, the slow pace of payments has been a major factor in the weak buying activity." 

In Tiruppur market, cotton yarn prices remained stable. The prices were noted as 30 count combed cotton yarn at ₹258-263 per kg (excluding GST), 34 count combed cotton yarn at ₹266-271 per kg, 40 count combed cotton yarn at ₹280-285 per kg, 30 count carded cotton yarn at ₹233-236 per kg, 34 count carded cotton yarn at ₹237-242 per kg and 40 count carded cotton yarn at ₹240-250 per kg, as per TexPro. 

Cotton prices in the Gujarat market have shown a bearish trend due to weak demand from spinning mills. The downtrend in ICE cotton prices has also impacted domestic prices. Traders report that spinning mills are cautious about new purchases, and the market is currently experiencing a cash crunch, further dampening demand. However, trade experts believe that cotton prices are nearing their lowest point and expect them to remain rangebound for the time being. 

In the Gujarat market, Shankar-6 cotton was priced between ₹56,500 and ₹56,800 per candy of 356 kg. Southern mills showed interest in purchasing cotton at ₹57,200 to ₹57,500 per candy. The arrival in Gujarat was approximately 30,000 bales of 170 kg each. The all-India arrival was estimated to be between 90,000 and 95,000 bales, each weighing 170 kg. 

ALCHEMPro News Desk (KUL)