Cotton yarn prices of major varieties remained steady in north India amid weak demand from fabric manufacturers. Market sources said that spinning mills were trying to increase their selling prices, but muted demand forced them to take back their steps. Fabrics manufactures were hesitant for new buying due to the proposed hike in GST from January 1.
On Friday, cotton yarn of 20 and 30 counts in combed variety were traded at ?320-330 and ?350-355 per kg respectively in Ludhiana, while carded yarn in 30 counts was quoted at ?315-330 per kg, according to Fibre2Fashion’s market analysis tool TexPro. There was no price change in the market for the past few days. In Delhi market, cotton yarn of 30 count combed was sold at ?325-345, 40 count combed at ?360-380, 30 count carded at ?295-315, and 40 count carded at ?330-350 per kg. 10 count weaving (O/E) yarn was quoted at ?120-125, while 16 count weaving (O/E) at ?160-165 per kg.
Panipat, which is known for recycled cotton yarn, also recorded muted trend. The price of 10s recycle yarn (white) was quoted at ?95-100, 10s recycle yarn (dyed) at ?75-95, 20s recycle yarn (dyed) at ?100-125, and 10s optical yarn at ?80-95 per kg. According to a trader, there was very poor demand for recycled yarn as downstream products manufacturers avoided fresh buying. Kolkata market also witnessed stable trend during the last few days.
A Delhi-based trader told Fibre2Fashion that the entire textile sector was nervous due to the proposed GST hike. With effect from January 1, 2022, fabrics manufacturers will have to pay 12 per cent GST instead of the current rate of 5 per cent. The demand from apparel manufacturers is already sluggish making it impossible for them to pass on the GST hike.
On the other hand, yarn manufacturers made unsuccessful attempt to hike the prices by ?5-10 per kg. According to trade sources, cotton yarn prices increased by around 3-4 per cent so their manufacturing cost went up. However, sluggish market conditions forced them to sell cotton yarn at the previous prices. Therefore, trading activities slowed down in current market conditions.
In the global market, ZCE cotton yarn May 2022 was traded lower at CNY 26735 per MT. On Friday, ICE cotton futures March 2022 contracts closed at 107.3 cents, down 238 points, May 2022 closed at 105.7 cents, down 223 points, December 2022 closed at 90.04 cents, down 55 points.
Meanwhile, cotton prices softened by ?10 per maund in the markets of North Indian states on Monday amid subdued demand from the mills, while daily arrivals recorded a decrease. Cotton was traded at ?63,497-63,783 per candy of 356 kg in Punjab, ?62,067-63,370 per candy in Haryana, and ?63,306-63,783 per candy in Rajasthan.