|
Item |
Unit |
Fluctuation |
|
|
PSF |
1194.38 |
USD/Ton |
0% |
|
VSF |
1842.62 |
USD/Ton |
0% |
|
ASF |
2430.90 |
USD/Ton |
0% |
|
Polyester POY |
1203.30 |
USD/Ton |
-1% |
|
Nylon FDY |
2949.49 |
USD/Ton |
0% |
|
40D Spandex |
6887.55 |
USD/Ton |
0% |
|
Nylon DTY |
5712.62 |
USD/Ton |
0.09% |
|
Viscose Long Filament |
1490.95 |
USD/Ton |
0% |
|
Polyester DTY |
2706.40 |
USD/Ton |
0% |
|
Nylon POY |
2576.75 |
USD/Ton |
0% |
|
Acrylic Top 3D |
1426.13 |
USD/Ton |
0% |
|
Polyester FDY |
3257.41 |
USD/Ton |
0% |
|
30S Spun Rayon Yarn |
2560.55 |
USD/Ton |
0% |
|
32S Polyester Yarn |
1896.10 |
USD/Ton |
0% |
|
45S T/C Yarn |
2868.46 |
USD/Ton |
0% |
|
45S Polyester Yarn |
2025.75 |
USD/Ton |
0% |
|
T/C Yarn 65/35 32S |
2479.52 |
USD/Ton |
0% |
|
40S Rayon Yarn |
2690.20 |
USD/Ton |
0% |
|
T/R Yarn 65/35 32S |
2592.96 |
USD/Ton |
0% |
|
10S Denim Fabric |
1.58 |
USD/Meter |
0% |
|
32S Twill Fabric |
0.99 |
USD/Meter |
0% |
|
40S Combed Poplin |
1.35 |
USD/Meter |
0% |
|
30S Rayon Fabric |
0.72 |
USD/Meter |
0% |
|
45S T/C Fabric |
0.78 |
USD/Meter |
0% |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.16206 USD dtd. 10/03/2015)
The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
The first Manmade Fibre Textile Conclave will be held in Mumbai which is jointly organized by Confederation of Indian Textile Industry (CITI) and Synthetic & Rayon Textile Export Promotion Council (SRTEPC). This will be a signature event of CITI & SRTEPC on Manmade Fibres and value added products based on them. The Conclave will explore the potential and examine the constraints in the manmade fibre sector and the emerging investment opportunities in the textile sector and evolve measures to spur growth and investment in this segment of the textile value chain. The Conclave would bring together leading manufacturers, consumers and end users of MMF products to enhance the business potential in this vital sector.
The theme of the conclave is ‘Innovation, Efficiency & Competitiveness’ which would reflect the potential of growth and the constraints. The Conclave would also emphasize on the need for interdisciplinary co-operation along the processing chain and stakeholders would discuss the issues and challenges and measures which could drive growth of MMF based industry. As part of the Conclave, a Business Session will be held on ‘Emerging Trends in Manmade Fibre Technology’. This session will discuss the latest technologies, fibre/filament innovations, changing technology, changing applications, and also issues related to fibre demand and long term opportunities.
Speakers and participants are being invited from all major countries involved in manmade fibres. Around 300 leading entrepreneurs associated with Manmade Textile Fibres from India are expected to participate in this Conclave. At MMF Textile Conclave issues ranging from raw material to international trade in Manmade Fibre based products will be discussed and experts would make detailed presentations on MMF specific topics. MMF Textile Conclave will be held on 17th March 2015 in Hotel Westin, Goregaon (East) Mumbai. Considering the importance of this conference, all are invited to attend the Conclave. There is no participation fee to attend the Conclave but participation will be regulated by registration.
SOURCE: Yarns&Fibers
To mandate the textile spinning sector to produce 40 per cent of their total output as Hank Yarn is absurd and not in sync with the present. There is a need to either scrap this Hank Yarn Obligation or reduce it to 10 per cent, say spinning industry sources. Suggesting the removal of the Hank Yarn Obligation (HYO) Scheme to Secretary – Textiles Sanjay Kumar Panda, Texpreneurs' Forum, a knowledge forum formed by like-minded textile entrepreneurs in this region, said “it (HYO) has outlived its utility and creating harassment and hardship to the textile industry in the country.”
“Though imposed with a good intention of providing handloom weavers with the necessary raw material in the early days, it has over the years, with introduction of the Technology Upgradation Fund Scheme and other initiatives of the textile ministry become redundant as handloom weavers have either moved to power looms or auto looms. There is hardly any demand for hank yarns,” said D Prabhu, Secretary, Texpreneurs' Forum.
“However, if there is ample demand for HY, the spinning industry would be only too willing to produce and sell such goods. But there is 1880 per cent excess production of HY in the State. Imposing artificial restriction on production in such a situation is causing huge hardship and the procedure for ensuring compliance is complex and cumbersome,” he added, sharing spindleage capacity and production figures as detailed below:
Industry sources said that this impossible situation pushed the sector to cook up production records, creating a window for the enforcing officials to indulge in corruption. “Some estimates say that around Rs. 50 cr to Rs. 60 cr of black money is being generated in the process,” an industry source said, preferring anonymity. The Forum has meanwhile appealed for removal of such restrictive policies. Hailing the Textile Ministry's initiative of appointing an external agency to review the HY policy review, Prabhu said “we await the findings of this agency; we are confident that it will reflect our suggestion on HYO.”
SOURCE: The Hindu Business Line
Indian textile and apparel industry is growing at the rate of 8-12%, and if the same growth is maintained or little higher, the industry is likely to get the double-digit growth during the FY15-16. As post the union budget, the economy will remain bullish because some of the fundamentals for economic growth are looking very good, according to Sanjay Behl, Chief Executive officer (Lifestyle business), Raymond.
Sanjay Behl at a fashion show for the launch of Raymond Linen said that he is enthused by the government taking steps to control inflation. Some reforms in the union budget are positive. Things are going in the right direction. The budget proposal and some of the steps taken by government recently, liquidity will improve, discretionary income in the hands of consumer will improve and that would increase people's spending capacity.
The share of textile and apparel sector in the consumer price index has gone up which is "validation" of reality, he said. Once you go beyond basic consumption you would go for more textile and apparel consumption. So there is a clear indication of they getting the benefit of the discretionary income in the hands of consumer.
SOURCE: Yarns&Fibers
Global non-oil trade volumes shrank further, plunging the shipping markets deeper into gloom in the last few weeks.
Lowest in history
The Baltic Dry Index, which measures cost of shipping of dry bulk cargoes, sank to just above 500 levels, the lowest in about the 30-year old history of the index. While a few ship owners are optimistic about a quicker recovery, AK Gupta, Chairman and Managing Director of Shipping Corporation of India, strikes a more realistic note. “The (dry bulk) market is in shambles. I do not think there will be any meaningful recovery before two years,” he told BusinessLine on the sidelines of an event here last week.
He attributed the plunge of the index to shrinking cargo volumes and over supply of ships in the market. SCI, India’s biggest ship owner, operates 17 dry bulk ships, out of its total fleet of 69 vessels. The index first hit its lowest in the first week of February when it dipped to 560 levels — it tanked from 1,300 in mid-November to 800-odd in mid-December. Before this, the lowest the index had touched was in February 2012, when it slipped to below 700. At its peak since the index came into existence, it touched close to 11,000 in May 2008.
Shrinking volumes
Gupta said, at current levels, dry bulk vessels were struggling to get daily hire charges of between $4,000 and $5,000 a day. “This is barely sufficient to breakeven on a voyage,” he says. The situation has worsened as too many ships are chasing the shrinking volumes. On March 9, a cape-size vessel got a daily charter price of $4768, while a Panamax got $4707, as against their year-ago rates of $24,748 and $8,757 respectively. Globally, shipping companies are trying different methods to reduce current exposure to bulk markets. One trend has been that ship owners, who placed orders for new bulk carriers, are trying to convert these ships mid-way during construction into tankers, which are commanding better freight rates. There have been reports of cancellation of orders too.
Conversion factor
“With regard to cancellations, a lot of it does not come out (in the open), but some of the companies have publicly converted or announced conversion of dry bulk orders to tanker orders. So Capesize vessels have been converted to LR1 tankers or LR2 tankers. But it is few and far between,” Shivakumar, Group CFO of Great Eastern Shipping, said at an analysts meet last month.
Large crude carriers
Shipping companies are being somewhat compensated by the better buoyancy in the tanker segment, as lower crude prices have increased demand for shipment of the oil. Gupta said traders are even hiring very large crude carriers (VLCCs) just to store the crude. “At least 35 VLCCs are being used for storage globally — so those many ships have gone out of market, which is pushing up the rates,” he said. SCI, which has four VLCCs, is expected to take deliver of its fifth new carrier being built in China in a few weeks.
SOURCE: The Hindu Business Line
Hailing the ‘Act East’ policy, Neil Kromash, Deputy Director, Regional Affairs at US Department of State, on Tuesday, said West Bengal offered immense opportunities for further developing connectivity in South Asia. Re-branding the Look East Policy meant that the new Act East policy has moved beyond mere rhetoric. Being the anchor of South Asia, India plays a leading role in this regional equation, he said.
“India’s re-branded Act East policy has moved beyond rhetoric and is taking shape across Indo-Pacific through summit level engagements with the ASEAN countries, trade agreements and other strategic investments meant to open new markets to the region,” Kromash said here on Tuesday. He was in the city to address a two-day seminar on “Building Pan Asian Connectivity”.
Enhanced Regional Cooperation
Interestingly, Kromash pointed out that Bangladesh with its geographical locational advantage; and the political transition of Myanmar has provided “great opportunities” for enhanced regional cooperation in South Asia. “Bangladesh… is sometimes overlooked in the discussion about regional connectivity, but it shouldn’t be….Strategically situated at the intersection of China, South Asia, Southeast Asia and the Indian Ocean, Bangladesh enjoys advantageous geography that makes it an ideal hub for connectivity,” he said. The political turmoil notwithstanding, the US of A will continue to engage with the country and strengthen bilateral ties. Regional economic cooperation will be high on their agenda.
Political Transition
On Myanmar, he said that the political transition that got under way in 2011 has seen the “emergence of significant opportunity” on the country. The improving economic climate has a big role to play in ensuring free flow of goods and services across borders. “As the undeniable conduit between South and Southeast Asia, Myanmar and its improving economic climate has a big role to play in the region’s future capacity to ensure free flow of goods and services across borders,” Kromash said. Similarly, positive developments have also taken place in Sri Lanka where the January elections brought a new government by “overthrowing a longstanding autocratic regime”. “The US will do all it can to support the new government in restoring democracy and heal fragile ethnic tensions,” he added.
SOURCE: The Hindu Business Line
India’s current account deficit (CAD) narrowed to 1.6% of gross domestic product (GDP) in the quarter ended 31 December, compared with 2% of GDP in the previous quarter, as net services exports rose and capital outflows fell. The merchandise trade deficit widened in the December quarter to $39.2 billion from $38.6 billion in the September quarter on account of a sharper decline in merchandise exports (7.3%) than in merchandise imports (4.5%), data released by the Reserve Bank of India (RBI) on Tuesday showed. Gold imports rose to $11.1 billion in the fiscal third quarter from $7.6 billion in the previous quarter as gold import rules were eased.
The government eased gold imports in November by removing a restriction that required traders to export 20% of the precious metal they bought overseas—a move that had been aimed at cutting the CAD. The so-called 20:80 norm was introduced in 2013 together with a duty of 10%, at a time when the deficit had widened to a record and gold imports had been surging. “On a cumulative basis, the overall balance of payments showed considerable improvement on a year-on-year basis on the back of a higher growth in merchandise exports and a marginal rise in merchandise imports, with a sizeable increase in net financial flows financing the CAD and enabling a large build-up of reserves,” RBI said in a statement. The CAD is expected to narrow further in the quarter to 31 March with the trade deficit declining further, said Madan Sabnavis, chief economist at CARE Ratings. “Typically, the invisibles account (transfer payments or remittances) brings in a net amount of $28-30 billion.
The trade balance has been in the range of $38-39 billion in the last two quarters and will be guided a lot by both movement in exports and imports,” Sabnavis said. “The third quarter does not capture fully the lower oil prices and hence the import bill may be expected to fall further. However, exports growth is not picking up, which can keep the trade balance above $30 billion, thus not allowing the deficit to turn to surplus,” he added. The Economic Survey released last month had pointed out that muted export growth and rising non-oil, non-gold imports could be affected by India’s deteriorating competitiveness, reflected in the appreciation of the real effective exchange rate by 8.5% since January 2014. On Tuesday, the rupee fell 24 paise to end at a two-month low of 62.78 per dollar, as Asian currencies and the stock markets fell on concerns of a rate hike by the US Federal Reserve. During October-December, the CAD of $8.2 billion was more than met by inflows on the capital account to the tune of $23.4 billion, leading to a $13.2 billion accrual to the foreign exchange reserves while $1.8 billion was marked error and omission.
Among services exports, net earnings through travel jumped to $1.8 billion in the third quarter from $0.9 billion in the previous quarter. Information, communication and telecommunication services also grew to $18.1 billion in the third quarter from $17 billion in the previous quarter. Gross private transfer receipts, representing remittances by Indians employed overseas, amounted to $17.5 billion and provided sustained support to the balance of payments with a share of 12.6% of current receipts—broadly the same level as in the preceding quarter and a year ago, RBI said. In the financial account, net inflows of foreign direct and portfolio investment were somewhat lower compared to the previous quarter, although net loans availed of by banks increased by $6.6 billion mainly on account of inward repatriations of assets held abroad by the lenders.
The Economic Survey said the outlook for the external sector is perhaps the most favourable since the 2008 global financial crisis, and especially compared with 2012-13, when elevated oil and gold imports fuelled a surge in the CAD. “Assuming a further moderation in average annual price of crude petroleum and other products, the current account deficit is estimated at about 1.3% of GDP for 2014-15 and less than 1% of GDP in 2015-16,” it added. Global crude oil prices in the Indian basket declined to $57.4 per barrel on Tuesday from $58.7 per barrel on Monday. The survey said a rule of thumb is that a $10 reduction in the price of oil helps improve the net trade and hence current account balance by $9.4 billion. The survey, however, cautioned that renewed financial market volatility in response to US Federal Reserve monetary tightening, which is expected later this year; possible turmoil if the viability of the euro zone were to come into question in the event of a Greek exit; a spike in oil prices related to geopolitical events; and a slowly deteriorating international trade environment pose challenges to India’s external stability in the next fiscal year.
SOURCE: The Live Mint
Tracking weak stocks, the rupee today fell 21 paise to end at two-month low of 62.76 against the greenback on sustained dollar demand from importers amid US rate hike concerns. A smart rise in dollar index against its major rivals also put pressure on the rupee. There was caution before release of Current Account Deficit numbers. After forex markets closed, data showed CAD doubled to USD 8.2 billion or 1.6 per cent of GDP in December quarter year-on-year.
After tanking 39 paise on Monday, the rupee resumed weak at 62.80 per dollar against overnight close of 62.55 at the Interbank Foreign Exchange (Forex) market. It moved erratically in a range of 62.6175 and 62.83 before settling at 62.76, revealing a fall of 21 paise or 0.34 per cent. The Indian benchmark S&P BSE Sensex today closed lower by 135 points or 0.47 per cent after plunging by 604.17 points or 2.05 per cent yesterday. Foreign Portfolio Investors (FPI) invested Rs 838.30 crore yesterday, as per provisional data.
The weakness in the rupee was due mainly to hopes of early rise in interest rates by Federal Reserve by mid-year which hurts stocks and currencies from emerging markets after better-than-expected US jobs data. Pramit Brahmbhatt, Veracity Group, CEO said: “Rupee traded weak and depreciated by over a quarter per cent. Negative sentiments continued to hammer local equities which closed down by nearly half percent. Dollar index continues to trade at multi-year highs. This further dented the rupee movement.”
The trading range for the spot rupee is expected to be within 62.40 to 63.20, he added. The forward premia continued to rule weak on sustained receipts from exporters. The benchmark six-month premium payable in August closed a tad lower at 229-231 paise from 229.5-231.5 paise yesterday and the forward contracts maturing in February 2016 also eased to 444.5-446.5 paise from 446-448 paise.
The Reserve Bank of India fixed the reference rate for dollar at 62.6983 and for Euro at 67.6577. The rupee edged up further against the pound to 94.53 from 94.54 Monday and also rose against the euro to 67.48 from 68.02. It, however, held stable at its overnight closing level of 51.71 per 100 yen.
SOURCE: The Financial Express
The international crude oil price of Indian Basket as computed/published today by Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas was US$ 55.93 per barrel (bbl) on 10.03.2015. This was lower than the price of US$ 57.40 per bbl on previous publishing day of 09.03.2015.
In rupee terms, the price of Indian Basket decreased to Rs 3506.81 per bbl on 10.03.2015 as compared to Rs 3594.39 per bbl on 09.03.2015. Rupee closed weaker at Rs 62.70 per US$ on 10.03.2015 as against Rs 62.62 per US$ on 09.03.2015.
The table below gives details in this regard:
|
Particulars |
Unit |
Price on March 10, 2015 (Previous trading day i.e. 09.03.2015) |
Pricing Fortnight for 01.03.2015 (Feb 12 to Feb 25, 2015) |
|
Crude Oil (Indian Basket) |
($/bbl) |
55.93 (57.40) |
57.84 |
|
(Rs/bbl |
3506.81 (3594.39) |
3598.80 |
|
|
Exchange Rate |
(Rs/$) |
62.70 (62.62) |
62.22 |
RC/Rk/Daily Crude oil price- 11.03.2015
SOURCE: PIB
The country’s Look East policy is yet to materialise on expected levels, Sanjoy Hazarika, Director of the Centre for North East Studies and Policy Research, Jamia Millia Islamia, said. According to him, a more inclusive approach is required and the North Eastern State governments need to be made stake-holders. This would help in improving connections — not just rail, land or air; but also in terms of services. “The problem is 60 years later, the Central government still perceives North East as a disturbed area. When the (State) governments from here (North East) are not stakeholders how can you go ahead with such a policy,” he said at a seminar on Pan Asian Connectivity organised by Indiana University in association with The US Consulate, Kolkata. “The focus should be more at the micro level initially, then we can look at the larger picture,” he said, adding that internal problems need to be resolved first and within a “reasonable time frame”.
According to Jonah Blank, Senior Political Scientist, RAND Corporation, the country’s Look East policy suffered because of coalition politics and focus on domestic compulsions. However, with the Modi Government having fewer political constraints than its predecessors, there are reasons to believe that the present should not be like the past, he said. He welcomed Modi’s engagement with Japan, the US and ASEAN as well with China as “very positive signs”. Speaking on trade relations between India and ASEAN nations, Blank said: “When it comes to Sino-India rivalry in Southeast Asia, China is winning the trade war hands down. Though India’s trade relation with ASEAN has improved, it is not very fast.” “India also lags behind China in terms of connectivity. Commercial flights from India to the region are sparse (as compared to China),” he added
SOURCE: The Hindu Business Line
India wants to explore the option of trading more with Pakistan through the rail route as existing product restrictions on trade through the Attari-Wagah land route and the high cost of sea transportation are acting as hurdles to bilateral trade. “In our discussions with businesses in Amritsar, we were given to understand that if the trains running between India and Pakistan became more regular, it could be used by traders as a viable option for transporting their goods,” Commerce Ministry Joint Secretary Arvind Mehta said at a seminar on non-tariff barriers organised by the Centre for Policy Research here on Tuesday.
Rail vs land
Interestingly, while Pakistan allows only 137 items to be traded through the Attari-Wagah land route, no such barriers exist on paper for supplies via the rail route. Railways has the potential of absorbing much of the trade happening via the sea-route, which is very expensive for traders and increases costs manifold. The idea of improving the train schedule, however, is at a conceptual stage, as the trade dialogue between the two countries has to re-start before new issues can be discussed. “I have discussed the proposal with my counterpart in the railways, but we have to wait for the dialogue to re-start,” said Mehta.
Hopes on talks
There are hopes that the Indo-Pak trade dialogue, which has been stalled for some time due to political differences, could re-start in the near future as the Foreign Secretaries from both countries met last week in Islamabad after one year of suspending talks. The absence of fixed schedules for trains was the main reason why traders do not use trains regularly for transporting goods. Exporters have to spend money on either keeping the goods stored in trucks or warehouses while waiting for the train, which boosts costs of operations. “If the railways come up with a fixed schedule, exporters will benefit hugely even if just one or two trains are run every week. They will then know exactly when to get their goods and load it on the trains,” Mehta said. According to figures collated by CPR, less than 5 per cent of trade between India and Pakistan took place through the land route in 2013-14, the cheapest option for traders from both sides. India exported goods worth $2.27 billion to Pakistan and imported items amounting to $427 million in 2013-14.
SOURCE: The Hindu Business Line
Bullish about growth potential in India, a top US lawmaker today said bilateral trade between the two countries could jump from current $ 100 billion to $ 500 billion if the Modi government continues with reform initiatives and removes regulatory hurdles. Chairman of the powerful US House Foreign Relations Committee Ed Royce called the government's budget proposals "big jump" to boost economic growth and attract foreign investment into India.
"We are absolutely bullish on the opportunity for economic growth in India today. We looked at the changes that are occurring and we looked at the achievements and we believe that the bilateral trade could well be $ 500 billion from current $ 100 billion," he told reporters. Hailing government's efforts to encourage infrastructure spending and decision to cut corporate tax by 5 per cent over the next four years, he said though budget proposals were not "quantum leap", they were big jump forward in revitalising the economy.
"It was not a quantum leap but it was a big jump and I think the commitment for infrastructure spending is important. I think the 25 per cent (corporate) tax rate down from 30 will bring more investment. I generally agree with Prime Minister's thesis of minimal government, maximum governance. "In other words, getting more efficiency in government, I think that's an approach reflected in the budget and it's a step by step process. It is a big step in the right direction," Royce said. Emphasising that there was scope for improving efficiency in governance, he said it takes 80 permissions to set up a hotel in India against six in Singapore.
"I know from the companies across US how focus they are on the opportunities in India," he said. Royce said the bilateral trade volume was one fourth of what it was today and taking it to $ 500 billion would not be difficult. Asked about India's position on the Ukraine issue, he said it will not have any impact on Indo-US ties. "I do not think it is going to affect the relationship with the US," he said while calling the issue as "tremendously complicated subject". He said Russia was recruiting youths to fight in Ukraine. Indian-American Congressman Ami Bera, who is part of the delegation, said there has been a real sense of energy in the ties and it was time to move the relationship forward. He said it could be the defining relationship of the 21st century. Speaking about the details about certain issues, he, however, added that devil could be in the details.
SOURCE: The Economic Times
Brent crude futures fell to around $57 a barrel on Tuesday as the dollar hit multi-year highs and the oil market remained hobbled by oversupply and weak demand. The US dollar touched a near 12-year peak against the euro and an eight-year high against the yen, hurting commodities priced in dollars by making them more expensive for holders of other currencies.
At 10.29 am EDT, Brent LCOc1 was down $1.52 at $57.01 a barrel, having touched an intraday low of $56.81 after US traders arrived at their desks. US crude CLc1 was down 47 cents at $49.53 a barrel. Traders and analysts said there was a risk of further falls as speculative net long positions were so high, particularly in Brent, while the fundamental picture remained one of weakness with no sign of any slowdown in production. “In order to balance the market we need the supply glut to be brought down, by rising demand or lower supply,” Ole Hansen, senior commodity strategist at Saxo Bank, said.
Demand from China, the world’s second-largest oil consumer, slowed in February as the Lunar New Year holiday cut into shipping volumes. At the same time, global refinery maintenance is about to peak, with global offline capacity assessed at 5.7 million barrels per day in April, according to Energy Aspects. “Brent is looking increasingly heavy with a decline likely to lowest levels in almost four weeks expected within the next couple of sessions,” oil analysts at Jefferies Futures said in a note.
Carsten Fritsch, an oil analyst at Commerzbank, said Brent had tried and failed to regain the $60 level on Monday, which had triggered a round of selling from short-term investors. “Brent could see further declines now, given the large overhang of speculative long positions,” he said. US crude has held up a little better because of a report from market data firm Genscape showing only a modest stock build last week at the Cushing, Oklahoma delivery point. Investors are waiting for weekly US inventory reports from industry group the American Petroleum Institute and the US government’s Energy Information Administration to see whether the Genscape numbers are confirmed.
SOURCE: The Business Standard
Crude oil prices have been firming up in recent weeks but the general view is that they will remain relatively low for some time yet. While supply will remain, the demand side may see nothing change much. USA still gives mixed signals, even with the benefits of cheaper gasoline while in Europe there are many problems, especially in terms of low consumer demand in the north and low employment in the south.
Worldwide there is not enough demand for oil prices to go up, yet the textiles market could see bouts of intense competition. The fall in oil prices had initially progressively widened margins along the supply chain, but as margins steadied for fibres and textiles they could be squeezed in case oil firm up. Firmer oil will force the petrochemical makers to either rationalise capacity to restore margins or hike prices. This could be achieved through raising intermediates prices which will feed down into fibres and textiles chain. But the beginning of cost support will emerge from feedstock, ethylene, paraxylene (for polyester chain), benzene (for nylon chain) and propylene (for acrylic chain).
In the month of February and the first week of March, all feedstock for textiles prices galloped across regions excepting in US for ethylene and propylene. Crude oil markets regained 10-30 per cent during these five weeks on support of the shrinking number of rigs drilling oil in the US while worries about the security of Libyan and Iraqi crude supplies also plugged the markets from falling in recent times. However, resurging US$ and fear that US may hike interest rate played negatively on the oil price rise.
Spot prices for propylene in Asia quickly responded to the firmer oil position, and stood at US$1,024-1,026 a ton FOB Korea in the first week of March. It was some US$225 above the bottom of the market seen in late January. All of this was not only cost-driven since demand remained subdued for most part of February and the return from the lunar New Year holiday. Tight supply also pushed prices up. Apart from the upcoming heavy turnaround season in South Korea, the unexpected shutdown of Japanese Maruzen Petrochemical's steam cracker at Chiba buoyed market sentiments. In USA, where prices showed signs of little firmness returning post holidays, fell in the week despite initial nominations for March was at an increase. In Europe, spot propylene prices rose following production issues and maintenance shutdown at major suppliers. The region faced two production issues - Dow began maintenance at main Terneuzen cracker. From end January to first week of March, propylene was dearer by 28-29 per cent in Asia and Europe, while it was 3 per cent cheaper in US.
After six months of decline, benzene prices appear to be at or close to bottom. In the USA the February contract dropped US cents 19 to US$2.01 per gallon, while in Europe the contract fell Euro 47 to Euro 521 a ton. In Asia, Nippon Oil settled its contract US$25 down at US$630. While contract prices were weakening, spot prices began to move higher - a sign that a market reached a point of price inflection. Asian benzene surged further tracking US gains and strong demand for May cargoes. Meanwhile, bullish sentiments caused benzene price to jump in Europe. In US benzene touched a four-month high on styrene demand and short-covering. Derivative styrene demand held firm as market participants eyed US export opportunities to Europe, which was ultimately leading to reductions in benzene supply. Benzene prices were up 31-33 per cent in Asian and European spot markets while they jumped 25 per cent in US between end-January and early March. This triggered cost support in downstream caprolactum and polyamide chip markets.
Supply crunch pushed ethylene prices up in Asian markets, lifting SEA values higher than NEA amid tighter supplies in the first week of March, taking the total rise of 24 per cent since end January. Meanwhile, the ethylene-naphtha spread hits highest level for 2015 led by a bullish ethylene market amid tight supplies. The impact of oil price rise was minimal since fundamentals tilted toward supply imbalance. Similarly, Asian rallies and planned, unplanned outages in Europe including improved margins on contract price hikes in Europe pushed spot ethylene prices up . Stronger naphtha was also a major contributor in the spurt. Competition from shale gas and lower February contract price settlement, subdued US ethylene spot price. While contracts settled at a 66-month low, spot hovered at 54-month low in US. There was some spot recovery after talks of production upsets as Williams Partners latest restart attempt was unsuccessful. In the past five weeks, ethylene spot prices in Asia and Europe were up 24 per cent and 12 per cent respectively, they fell two per cent in US.
Polyester feedstock, paraxylene was dearer by 14-18 per cent across all markets since end-January 2015, after having falling persistently in line with the drop in oil prices since June 2014. Buying sentiment improved with bids for Asian origin cargoes and discussion levels were seen above those for CFR Northeast Asia cargoes. US paraxylene market has been following peak and trough in Asia, and saw spot moves up 15 per cent in the past five weeks.
Overall, the drive in feedstock in recent weeks has more to do with supply impediments rather than demand and or costs. Being largely a maintenance season for most petrochemical units, supply will remain in deficit in a normal demand curve scenario. And this may continue for some time and keeping boosting their respective downstreams and finally to staple fibres and filament yarns. And in case demand improves, values all along the chain will be lifted, which may in turn provide support to falling crude oil prices, “ceteris paribus”.
SOURCE: Yarns&Fibers
Shaoxing Mina Textile Company a Chinese company decides to make investment of over 15 million USD to expand its textile and garment factory at Sebeta Town, Oromia State which upon completion would create 5,000 jobs. President Dr. Mulatu Teshome in a discussion with Company CEO Chang Jun held last Wednesday, said that the government is keen to support investors engaged in manufacturing industries.
Dr. Mulatu further noted that the presence of a favourable investment atmosphere, cheap labour, ample market opportunity and its ideal geographical location will make Ethiopia a comparatively more advantageous place for investors engaged in the manufacturing sector. On his part, Company CEO, Wei Chang Jun said that the dying and printing factory that has been under expansion on five hectares of land will be completed within months as 95 percent of the equipment has already been imported from Italy and South Korea. The textile and garment factory plans to export its products to Europe, the USA, Thailand, Turkey and other African countries. The Ethiopian government is working actively in the area of textiles and garment industry and has assured that it will support the company by all means available.
SOURCE: Yarns&Fibers
India’s merchandise exports, after contracting in December and January, might get only a marginal lift from rising economic prospects in the US. This could be because of a decline in commodity prices year-on-year reducing the value of exports, and regulatory problems for pharma companies in the US. India’s efforts to diversify its trade markets had been fairly successful, with the six-nation Gulf Cooperation Council (GCC) taking over the European Union (EU) as its largest export destination during the April-December. But the overall exports have lately been hit by a steep decline in commodity prices, including that of petroleum products.
Hopes of a recovery in the US have gathered steam, especially after the economy added 295,000 jobs in February, and that country’s unemployment rate fell to 5.5 per cent, the lowest in the post-recession period. A full-blown economic recovery in the US, however, remains elusive. The US economy grew 2.4 per cent in 2014, marginally up against 2.2 per cent in the previous year. The US remains India’s top destination for exports in terms of country; it accounted for $32.44 billion worth of exports during the first nine months of the current financial year, or 12.77 per cent of India’s $253.97-billion total outbound shipments. The bulk of the country’s exports is accounted for by pharmaceutical products, minerals and mineral oils.
“The contraction in global demand is waning. But these will not lead to much increase in exports, given a decline in commodity prices," says Ajay Sahai, director general & chief executive of the Federation of Indian Export Organisations (FIEO). Besides, delays in regulatory approvals to pharma products might hinder exports to the US, as medicines are one of the key items of India’s export basket. India exported $2.68 billion worth of pharma products to the US; this was 8.8 per cent of its total exports to that country during the April-December period. Meanwhile, a softening in prices of commodities, particularly oil, might also come in the way of India’s diversification of exports to the six-member GCC.
In the first nine months of the current financial year, India’s exports to the Gulf bloc stood at $38.44 billion, or 16.28 per cent of its total outbound shipments. This was higher than the $37.46 billion to the EU, which accounted for 15.76 per cent of total exports. EU had been India’s largest export destination in terms of the region for a number of years. Sahai says one of the reasons for an increase in India’s exports to GCC has been the rise in petroleum products’ share in India’s export profile. Of the total exports made to GCC, close to 40 per cent were petroleum exports. However, India’s exports to each of the GCC countries are different. While petroleum exports account for the largest chunk of exports to Saudi Arabia and Oman, gems & jewellery is the predominant category of exports to the UAE. The main exports to Kuwait are cereals, while iron & steel dominates exports to Baharain. Ship and floating structure is the main item of exports to Qatar.
Oil prices remained over $100 a barrel in 2013-14, but came down to just over $46 by January, 2015. To the extent that these are diversified, the impact of falling commodity prices could be blunted. However, together with oil, prices of other commodities like iron and steel have also fallen by 15-20 per cent in the past year. Besides, declining crude oil prices affect economies of the six GCC countries as well, curtailing their demand for imports. The impact of a decline in petroleum prices could be gauged from the fact that exports of oil products declined sharply, by 48.69 per cent to $2.8 billion, in January. These earlier used to be the top items of India’s exports but now have fallen behind engineering goods. India had in January exported $6.9 billion worth of engineering goods and $3 billion worth of gems & jewellery.
The rupee did not depreciate against the dollar so much over the year to offset for fall in commodity prices. Even if one takes into account sharp fall in rupee against the dollar, the rupee depreciated just over 3 per cent on March 10, 2015 year-on-year. On the other hand, an economic slowdown in China might have a limited impact on India’s exports, as India mainly exports inputs, and not high-value items, to that nation. China has lowered its economic growth target for 2015 to about seven per cent. This is lower than the 7.5 per cent its government had set for 2014. The economy had grown 7.4 per cent last year, the slowest since 1990.
India exported $9.19 billion worth of merchandise to China during the April-December period. Cotton, at $1.7 billion, was the biggest item of exports to that country. It was followed by copper and articles ($1.5 billion) and mineral fuels and mineral oils ($1.1 billion). India’s overall exports in January declined for a second straight month, by 11.9 per cent. The country’s outbound shipment rose only 2.4 per cent to $265.03 billion in the first 10 months of the current financial year, against $258.7 billion in the corresponding period of last year.
SOURCE: The Business Standard
Propylene prices climbed in Europe in the last week ending March 6 from strong market sentiments. However, they stayed stable in the US, due to ample of product availability in the region. In Europe, average prices grew by € 35/ton or 4.19 per cent and were quoted at € 870/ton last week, as compared to its previous week. In US, average prices were stable and were quoted at 40 cents/pound last week, as against its previous week.
SOURCE: Fibre2fashion
China's consumer inflation rebounded in February from a more-than-five-year low, official data showed Tuesday, but a plunge in factory gate prices added to persistent concerns about deflation in the world's second-largest economy. The 1.4 percent increase in the consumer price index (CPI) compared with a gain of 0.8 percent in January, according to National Bureau of Statistics (NBS) figures.
The result, which exceeded the median forecast for a 1.0 percent gain in a survey of analysts by Bloomberg News, came largely due to higher prices for food and services surrounding China's annual Lunar New year holiday, which economists largely saw as a one-off. In contrast the producer price index (PPI) -- a measure of costs for goods at the factory gate and a leading indicator of the trend for CPI -- declined for the 36th straight month in February.
The PPI fell 4.8 percent year-on-year, the NBS said, more than the 4.3 percent decline recorded in January, and the worst result since October 2009. Moderate inflation can be a boon to consumption as it encourages consumers to buy before prices go up, while falling prices encourage shoppers to delay purchases and companies to put off investment, both of which can hurt growth. "We continue to expect inflation to remain relatively low and still see disinflationary pressures in the economy," Nomura economists said in an analysis of the February data.
SOURCE: The Global Textiles
