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ReturnSURESH MEHTA ANALYSIS(12)--Review on silk market(Till Dec. 17)
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admin
PublishDate：
2005-12-19 08:43:00
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RAW SILK - A WONDERFUL YEAR AND THE FINAL FRONTIER
From oct 2004 raw silk has been on a wave of appreciation defying all logics . ruling majestically through all these months and still rules so far , however as all good things have to end i can visualise the peak and then the easing out slowly to absorb the corrections and re adjust the supply demand chain .as we have witnessed with every new high the volume to india is reducing. Raw Silk is nearing its peak both in china and india . Maybe this is the final frontier and we may see prices stabilising now and hold on for few weeks before any new trends to form. The Indian Market has to absorb a lot and much of it has been absorbed. The dollar appreciating , The prices increasing, and with very little room for further increase the orders from importers traders have stopped and only the indian exporters can buy at these levels. Raw silk At these levels for importer traders is a very high risk aspect as the cost will be lot more than the existing prices in india. even though we cant see any prices easing out till
february 2006 in china.
The indian silk fabrics industry is facing huge pressure as the fabric cost is spiralling and the cost is not getting absorbed in the fabric industry.they have resorted to cut down the production which in turn will lead to low demand for silk yarn in india. It looks very tough from this stage onwards for any further major upward movements in india.Remaining stable will slowly make the cost get absorbed. the chinese producers have to remain stable and gradually ease the prices downwards now.the only alternative for indian importer traders is to look for alternative cargo from other sources available at lower prices.
finally one thing is very clear that the absorbing capacity of the indian silk industry has reached its peak and it cannot absorb any further increase , i think it is time for "raw silk " the king to rest and relax now .
Dupion - Made For 2006
the supply demand ratio in china is getting rectified according to reports from china and dupion will get into a better position from jan end onwards . with low orders in india i think dupion will bottom out in dec end and early jan . the bottom out period will certainly also exhuast the stock in china as well as india and will bring the demand by way of shortage rather than real orders. dupion will improve from jan end and depending on the local orders it may gather steam and make the year 2006 a better one for dupion.
Tussah
tussah remains the silent spectator with sudden bouts of increase in prices and stabilising again , however the room for upward movement still exists in tussah and we need to wait and watch the movements both in india and china.the shortage is evident in china and will sooner or later affect the indian market also. expected peak value for tussah may reach about usd30.
Fabrics
The push is expected any moment in the indian market for the fabrics and we can see signs of the increase , with heavy orders for 12101 , the interest now is moving towards the 10103 and 10101 , the bookings in 12101 would have still continued but for the fact that the sudden price increase in china stopped the flow of orders. in spite of all these issues the fabric flow to india will remain stable .
bangalore open market prices
chinese silk yarns
raw silk - rs 1585
tussah - rs 1500
dupion - rs 1140 -1210
tram - rs 1625
org - rs 1725
fabrics : 12101 - sichuan rs 144/145 - zhejiang - rs 140/141
sichuan10103 - rs 145/146 - zhejiang 10103- rs 137-138 zhejiang 10101 - rs 92
