Pakistan: limited import demand

Only a modest level of import demand has been witnessed over the last few days. Despite the recent drop in ICE futures into the low 80s cents per lb, import business has failed to pick up significantly. Although many mills would be willing to cover at prices around 92.00/94.00 cents per lb, CFR Karachi, most do not have the capacity to generate new Letters of Credit and are already struggling to open LCs against existing contracts due to the very stringent curbs on imports introduced by the State Bank of Pakistan. Furthermore, the expectation that the rupee will depreciate against the US dollar has remained in focus, leading mills to cover local cotton as a hedge against a falling currency.

Some Brazilian lots for nearby shipment have moved at around 1,000/1,500 points ‘on’ March 2023, depending on the specifications. Further modest sales of US recaps have taken place for nearby shipment within a similar price range. Business in Ugandan cotton has been reported around 1,100/1,200, also ‘on’ March. Some retail lots of Egyptian Giza 94 have found buyers.

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