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ReturnSURESH MEHTA ANALYSIS(9)--Weekly review of indian market (Till Nov 13)
Author：
admin
PublishDate：
2005-11-14 11:03:00
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536
dear friends
raw silk
This week has been a week for the speculators, both in china and India , the drop in the exchange early this week in china was followed by the same in India. they took the cue from it and the prices dropped from 1550 to rs 1500 a fall above one usd.this situation was unexpected in china and there is no clear reason for the market to go down .however the situation in India is localized and it doesn't concern the Chinese market. as the cargo arriving in India is now of lower prices it may take atleast a week or ten days before the price in India follows china. the depression created by the Chinese change during the start of the week has gained in momentum in India and it has yet to react to the changes in the end of the week in the exchange where the jiaxing exchange was corrected.
it has been seen in the past that whenever the market is in opposite direction in these two places it always tends up to shoot up to new highs.as said before it is clear that the export prices from china to India will touch to used 30 or rmb 250 in the jiaxing exchange. I think this is the peak of raw silk for some time .
The Indian market will correct when the higher priced cargo arrives which is going to be very soon as now the raw silk cycle is shortened in the supply chain mainly due to the avoidance of the retesting by Indian customs.however as long as the Indian market remains depressed it is better for the Indian importers to stock cargo available locally at cheaper levels than import.
Finally if the jiaxing exchange maintains the upward trend then the Indian market will have to follow it and change the sentiments in India which was down last week .let hope the coming week shows signs of stability rather than volatility as it is the time now to stabilize the market and improve the flow of business. the stability will also clear the confusion and may lead to easy decision making for the importers to plan the future imports.
Dupion
dupion finally has attained some stability and there is normal movement in India after a long time.even though the workable price is just about usd 20 the flow may influence many importer to place order as there is less risk involved than raw silk.dupion is expected to be good in November and gradually be normal in dec as we have seen for the whole year. unless the normal mills in china drops the production to considerable level in china we have no hopes yet till 2006 for dupion. dupion may become workable in 2006 only if the production is controlled and organized in china leading to a correct supply demand chain which is very important , the import of dupion to India has reduced almost by 30% compared to early 2005, it is a pathetic 150 tonnes which mainly is consumed by Indian exporters rather than Indian importers-traders.
Tussah
the floating cargo in India still is a stumbling block for tussah price movements, the price is gradually decreasing in India inspite of higher quotes from china. the tussah fabric demand in India islesser compared earlier and the import had been huge creating a over supply situation and may take some time before the cargo is consumed. however tussah still looks good for the upward trend and may do so shortly.
Fabrics
the 12101 is slowly becoming steady and slowly moving upwards , the new enquiries have also gaining momentum but the issue is the price , the present quotes by Chinese exporters are unworkable unless the importer wants to do speculation. a little correction of Chinese prices may help the fabric to gain momentum to huge orders.
overview
the raw silk downtrend in India is totally a local situation, the arrival of lower priced cargo in large quantities is the reason for the correction and it will follow Chinese market after the cargo is exhausted.
wholesale price index:
Bangalore - Chinese silk yarns
raw silk 20/22 3/4 a - rs 1500
dupion silk - 100/120d - normal mills 1140 top mills 1180\
tussah silk yarn - rs 1400
organzine - rs 1650
tram/thrown - rs 1530
fabrics
12101 - Sichuan origin -139.00 zhejiang -134.00
10103 - Sichuan origin - 139.00 top mills Sichuan - 143 zhejiang 133.00
10101 - zhejiang - 88.00
