Posted : March 25, 2023

Market Movement from 13th Mar 2023 to 18th Mar 2023.

  • Cotton prices continued their downward trend, with NY May closing at 77.83 on 17-March with weekly loss of 0.35 cents - a reflection of ongoing market volatility.
  • Cotton prices experienced a volatile week, with significant price swings influenced by global banking system concerns and a series of economic data releases. On Monday, cotton prices closed sharply higher to limit up, in contrast to Friday's bearish trade, due to recovering Dow, weak U.S. dollar, and cash cotton liquidation. Managed-money funds were net sellers last week, with their first net-short position in a while. On Tuesday, cotton prices remained steady, supported by a higher Dow Jones. On Wednesday, cotton prices declined due to a sharply lower Dow Jones and a spike-up in the U.S. dollar. The banking giant Credit Suisse's money troubles raised concerns over the state of the global banking system, which led to the market's decline. On Thursday, cotton prices experienced price swings due to improved export sales and global banking system fears. The week ended with the USDA's weekly export sales data release and the CFTC's report.
  • In the latest U.S. export sales report, the 2022-2023 season showed a net upland sales of 2,25,600 bales, with upland shipments of 2,73,900 bales and net Pima sales of 7,600 bales, and Pima shipments of 1,500 bales. The total sales for the season were 2,33,200 bales. For the 2023-2024 season, the net upland sales were 12,800 bales, while net Pima sales were at zero, resulting in a total of 12,800 bales. These numbers provide valuable insight into the current state of the cotton market, indicating the demand for both upland and Pima cotton.
  • The Gujcot Spot Rate for cotton experienced a relatively stable week, with minor fluctuations throughout the week. On Monday and Tuesday, the rate held steady at 61,050, while Wednesday saw a slight increase to 61,200. However, the latter half of the week saw a dip in the rate, with Thursday seeing a drop to 60,750 before slightly recovering to 60,800 on Friday. Overall, the Gujcot Spot Rate remained relatively stable throughout the week, with minor fluctuations driven by market factors.
  • All India arrival of cotton has declined owing to several factors, including certain festivals, rainfall in cotton-growing regions, and farmers' agitation in Maharashtra. At present, the daily arrivals stand close to 1,25,000 bales.
  • The arrival of cotton in Gujarat remains steady at approximately 40,000 bales per day.
  • Ginners are currently facing disparity due to lower seed rates and reduced demand of cotton.
  • Farmers are now willing to sell their produce at prices below Rs. 8,000 a quintal.
  • The mills are currently operating at near-full capacity, but with a focus on producing finer count yarns. However, the yarn sale remained poor during this week.
  • The Indian basis is increasing due to the lower NY futures. Raw cotton export remains limited, and Indian mills are struggling to achieve yarn parity with their foreign rivals.
  • The USD-INR exchange rate had a fluctuating week, with rates ranging from 82.12 on Monday to 82.73 on Thursday, before ending the week at 82.55. The rate had closed at 82.04 the previous Friday.
  • Hope for better parity to whole value chain.


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