Comment by Riaz Haq on September 15, 2022 at 11:53am

Shahid Ali Habib
@ShahidAliHabib1
Highest ever revenue and highest ever profit by
@InterloopLtd
, largest textile manufacturer of #Pakistan. 100% increase in profits and over +60% in revenues (exports).
Thank you so much
@MusadaqZ
and
@navidcch
, Maqsood Sb and entire Interloop team. #PSX is delighted to have you

https://twitter.com/ShahidAliHabib1/status/1570451775047565315?s=20...

Comment by Riaz Haq on September 16, 2022 at 8:44am

Arif Habib Limited
@ArifHabibLtd
Textile exports increased by 8% YoY to USD 1.6bn during Aug’22
Aug’22: $ 1.58bn, +8% YoY, +6% MoM
2MFY23: $ 3.06bn, +4% YoY

@PBSofficialpak

@APTMAofficial

@StateBank_Pak

#PBS #Exports #Trade #Economy

https://twitter.com/ArifHabibLtd/status/1570331949239091200?s=20&am...

Comment by Riaz Haq on October 2, 2022 at 10:10pm

#Factories Making Towels & Bedsheets Are Shutting in #Pakistan. As many as 100 smaller #textile mills have suspended operations due to a shortage of good quality #cotton, high #fuel costs, & poor recovery of payments from buyers in flood-hit areas https://finance.yahoo.com/news/factories-making-towels-bedsheets-sh...

The mill closures underscore challenges for the sector that employs about 10 million people, accounts for 8% of the economy and adds more than half to the nation’s export earnings. Their hardships have become acute due to recent floods, which submerged a third of Pakistan, killed more than 1,600 people, and damaged about 35% of the cotton crop.

The latest blow comes at a difficult time for the South Asian nation that is already struggling with high inflation and falling currency reserves. The closure of firms, such as AN Textile Mills Ltd., Shams Textile Mills Ltd., J.A. Textile Mills Ltd. and Asim Textile Mills Ltd., could worsen the country’s employment situation and hit its export earnings. Larger companies are also facing rough weather, with demand for their products seen falling about 10% by December from now due to a slowdown in Europe and the US, Mukhtar said.

Due to an “unforeseen downturn in the market and unavailability of good quality cotton” following heavy rains and floods, the company’s mills have been temporarily closed, Faisalabad-based AN Textile said in an exchange filing earlier this month.

Cotton production in Pakistan could slump to 6.5 million bales (of 170 kilograms each) in the year that started in July, compared with a target of 11 million, Mukhtar said. That could force the nation to spend about $3 billion to import cotton from countries such as Brazil, Turkey, the US, East and West Africa and Afghanistan, said Gohar Ejaz, patron-in-chief of All Pakistan Textile Mills Association. About 30% of Pakistan’s textile production capacity for exports has been hampered because of cotton and energy shortages, Ejaz said.

Comment by Riaz Haq on November 17, 2022 at 7:36am

Arif Habib Limited
@ArifHabibLtd
Monthly machinery imports declined to a 9 year low of USD 457mn during Oct’22
Oct’22: $ 0.46bn, -48% YoY, -3% MoM
4MFY23: $ 2.2bn, -40% YoY

https://twitter.com/ArifHabibLtd/status/1593263516810727424?s=20&am...

Comment by Riaz Haq on November 17, 2022 at 9:31am

Arif Habib Limited
@ArifHabibLtd
Textile exports decreased by 15% YoY to USD 1.4bn during Oct’22
Oct’22: $ 1.4bn, -15% YoY, -11% MoM
4MFY23: $ 5.9bn, -1% YoY

https://twitter.com/ArifHabibLtd/status/1593262890919895040?s=20&am...

Comment by Riaz Haq on December 14, 2022 at 7:07pm

Workplace safety accord extended to Pakistan

https://www.dawn.com/news/1726412/workplace-safety-accord-extended-...

KARACHI: A comprehensive Workplace Safety Programme (WSP) is being launched in Pakistan by the signatories to the International Accord for Health and Safety in the Textile and Garment Industry, a move that will support the country to boost its textile sector.

The programme will cover Pakistan’s garments and textile suppliers, helping the country improve the industry like that of Bangladesh and other signatories to the accord.

The decision to expand the programme to Pakistan was announced during a signatory brand caucus meeting held on Wednesday in Amsterdam. Brands will receive an information package on the Pakistan Accord and will be invited to sign it on Jan 16, 2023, said a press release issued here on Wednesday.

“I am pleased to see the International Accord signatories reach an agreement to establish a WSP covering the signatories’ garment and textile suppliers in Pakistan. We are committed to working closely with Pakistani stakeholders to ensure our collective efforts are beneficial to the industry and its workers,” said Joris Oldenziel, Executive Director of International Accord Foundation.

The programme aims to incrementally cover more than 500 factories producing for over 100 accord signatory companies throughout Sindh and Punjab, where most of Pakistan’s $20 billion in garment and textile exports are manufactured annually.

The International Accord has undertaken extensive engagement in Pakistan with federal ministries and provincial governments, industry associations, suppliers, trade unions and civil society organisations.

The Pakistan Accord covers Cut-Make-Trim (CMT) facilities cover ready-made garment (RMG), home textile, fabric and knit accessories suppliers (including vertically integrated facilities). Fabric mills within the supply chains of the signatories are also covered, with implementation scheduled for a later stage in the programme.

The successful experience in Bangladesh prompted the signatories to expand the workplace safety programme to at least one other textile and garment-producing country. Through signatory surveys, extensive research, and local stakeholder consultations, the Accord Secretariat assessed the feasibility of expanding based on key factors. Pakistan emerged as a priority country, in part because of its importance as a garment and textile sourcing country for the accord brands.

The Pakistan Accord programmes will be implemented in phases, in close collaboration with these key stakeholders and through the establishment of a national governance body.

The new Pakistan Accord on Health and Safety in the Textile and Garment Industry is a legally binding agreement between global unions, IndustriALL and UNI Global Union, and garment brands and retailers for an interim term of three years starting from 2023.

Building on widespread safety improvements in Bangladesh, the Pakistan Accord includes all key International Accord features — independent safety inspections to address identified fire, electrical, structural and boiler hazards, monitoring and supporting remediation, safety comm­ittee training and worker safety awareness programme, an independent complaints mechanism, a commitment to broad transparency, and local capacity-building to enhance a culture of health and safety in the industry.

Comment by Riaz Haq on April 13, 2023 at 12:21pm

Pakistan’s exports fall 15pc for seventh month in a row

https://www.dawn.com/news/1745744

Pakistan’s exports of merchandise shrank for the seventh month in a row dipping by 14.76 per cent year-on-year to $2.36 billion in March, reflecting fear of massive layoffs in the export sector of the country.

In the first nine months (July to March) of 2022-23, exports were down 9.87pc at $21.04bn compared to $23.35bn in the corresponding period last year, according to data released by the Pakistan Bureau of Statistics on Monday.

The export proceeds are declining mainly because of internal and external factors raising fears about the closure of industrial units, especially textile, and clothing.

Imports dipped 40.25pc to $3.82bn in March compared to $6.40bn over the corresponding month of last year. In the first nine months, imports fell 25.34pc to $43.94bn this year from $58.85bn over the corresponding period last year.

Between July and March FY23, the trade deficit decelerated 35.5pc to $22.9bn from $35.50bn over the corresponding months of last year. In March, the trade deficit fell 59.75pc to $1.46bn on a year-on-year basis.


The exports started posting negative growth in the first month of the current fiscal year — July — barring August when a slight increase was recorded because of the backlog of the preceding month. Export contraction is a worrisome factor, which will create problems in balancing the country’s external account.

The drop especially in textile and clothing, which constitutes more than 60pc of total exports shows the government would find it difficult to achieve the export target this fiscal year.

The declining textile exports are a result of the federal government’s lack of strategy and inability to prioritise effectively - it seems they are simply running the government on a day-to-day basis, Patron in Chief Pakistan Textile Exporters Association Mr Khurram Mukhtar told Dawn.

He said the root causes of the export decline include working capital shortages, and refunds being stuck such as sales tax, deferred sales tax, income tax, drawbacks of local taxes and levies, technology upgradation fund, and duty drawback.

Unfortunately, the faster refund system is not functioning as intended, with refunds now taking 3-5 months to process instead of the promised 72 hours. Additionally, the sector is facing a substantial increase in financial and energy costs, the exporter further lamented.

Without addressing these issues, it will be impossible for the textile industry to compete regionally on cost and get back on track with exports, Mr Mukhtar said. It’s particularly concerning that the largest employer in the country is being neglected by the government.

Mr Mukhtar stressed the need for a dialogue between industry leaders and the government, with the right priorities identified and addressed.

Pakistan Apparel Forum chairman Jawed Bilwani said that it has become difficult for exporters to place orders for the import of raw materials and other inputs procured locally. He said the State Bank of Pakistan has created hurdles in opening letters of credit which led to a decline in exports.

He said buyers have withheld their orders mainly because of political and economic uncertainty in the country. He suggested the government should come up with clear statements to give signals to foreign buyers that their orders will be delivered on time. “We have no choice but to give assurances to buyers to meet their demands”, he said.

Mr Bilwani lamented that Prime Minister Shehbaz Sharif has cancelled four meetings with exporters.

He said the foreign exchange reserves of the country can only be built through an increase in exports.

He predicted exports will fall by 17pc in April. He said the government discontinued subsidies on electricity and gas for the export sector on March 1 which has rendered Pakistani exporters uncompetitive on the world markets.

Exporters believe that one of the main reasons behind falling exports was the exchange rate instability.

Comment by Riaz Haq on April 13, 2023 at 4:11pm

Remittances in March rise to $2.5bn — highest since August 2022
Analysts attribute monthly increase in the remittances to the Ramadan factor

https://www.thenews.com.pk/latest/1059219-remittances-in-march-rise...

Remittances sent by overseas Pakistani workers, a major source of foreign exchange, rose to a seven-month high of $2.5 billion in March 2023 — an encouraging sign for the cash-strapped country.

The State Bank of Pakistan (SBP), in its monthly bulletin, on Monday stated that the inflow of workers’ remittances was 27% higher compared to the prior month of February; however, it was 11% lower compared to March 2022.

Arif Habib Limited Head of Research Tahir Abbas told TheNews.com.pk that the monthly increase in the remittances is due to the Ramadan factor which usually fetches higher flows due to family commitments, welfare, charity etc.

"The flows in the upcoming months are expected to remain elevated due to another Eid [Eid ul Adha] falling by the end of this fiscal year," he maintained.

Historical trends suggested that overseas Pakistanis sent record-high remittances ahead of Eid festivals every year.

Moreover, inflows remained comparatively high as non-resident Pakistanis used legal channels to send funds to their family members due to the shrinking gap between rates in the interbank and open market.

Samiullah Tariq, head of research at Pakistan-Kuwait Investment Company, termed the increase a “good omen”, elaborating that the difference between the kerb and interbank rates was minimal.

“Remittances number is highest for past seven months; however, this year Ramadan has started earlier which is why remittance inflow increased earlier than last year,” he explained.

The Ministry of Finance has projected that the remittances will “further improve due to positive seasonal and Ramadan factor”.

Meanwhile, the central bank stated that with the cumulative inflow of $20.5 billion during the first nine months of the fiscal year 2022-23, the remittances decreased by 10.8% as compared to the same period last year.

It should also be noted that with remittances widely surpassing the Pakistan Bureau of Statistics (PBS) trade deficit data this month, the possibility of a current account surplus has increased to a great extent.

It should be noted that the SBP trade deficit data point is usually even lower than the PBS trade deficit.

In its monthly outlook report, the Ministry of Finance also mentioned that the current account deficit is likely to remain on the lower side keeping in view the economic factors contributing to the numbers.

Country-wise data
Pakistanis residing in Saudi Arabia remitted the largest amount of $563.9 million in March. However, it was 24.04% lower than the $454.6 million received in February.

Expatriates in the UAE sent home 25.52% more amount as receipts increased from $406.7 million to $324 million.

Remittances from overseas Pakistanis in the UK increased 33.12% to $422 million. They sent $317 million in February.

Moreover, remittances from other Gulf Cooperation Council (GCC) countries decreased by 10.33% to $297.6 million and a 21.72% increase was recorded in inflows from European countries, which clocked in at $298.6 million in the month under review compared to February.

Comment by Riaz Haq on May 16, 2023 at 6:20pm

Pakistan sees lowest output of cotton in four decades


https://www.dawn.com/news/1745814


The country has produced 34 per cent less cotton this year as compared with the crop yield last season, reveals data with Pakistan Cotton Gin­ners Association (PCGA).

The final figures for the crop year 2022-23 show that Pakistan produced 4,912,069 bales, the lowest in around four decades, of cotton against 7,441,833 in the 2021-22 season, a year-on-year decline of 2,528,764 bales or 34pc loss.

It means the textile industry will have to import around 10 million bales to satiate its annual hunger for 15m bales. However, mill consumption in the year 2022-23 has also been reported at 8.8m bales, the lowest in over 20 years, mainly because of severe import financing issues.

Market sources say the textile mills have so far signed import agreements for 5.5m bales, whereas they have purchased 4,605,449 bales from the local market. Last year, the mills had bought 7,332,000 bales from the domestic market.

Ginners say they are still holding 301,720 bales in their stocks against last year’s inventory of 93,833 bales.

Flash floods and heavy rains during last year monsoon that devastated large swathes of the agricultural land in the country, particularly in Sindh and Balochistan provinces, are blamed for the massive drop in cotton arrival.

Interestingly, despite a strong demand in international markets, only 4,900 bales of white lint could be exported this year against the previous year’s figure of 11,000 bales, a fall of over 69pc. The main destinations of Pakistan’s raw cotton are the Philippines, Italy, Bangladesh, Greece and France.

Province-wise, Punjab registered over 32pc year-on-year decline in output as it produced 3,033,050 bales this season against 3,928,690 bales last season.

Sindh reported over 46pc year-on-year loss in yield as the lint production in the province this year stood at 1,879,019 bales against 3,513,143 bales last year.

Pakistan’s cotton output reached a high of 14.1m bales in the year 2004-05. But it dropped to 7m bales in 2020-21 and about 9.45m bales in 2021-22 as the country’s per acre yield contracted to half of the crop productivity in other countries of the region.

Expressing concern over the continuous decline in cotton production and acreage over the years, a recent meeting of the Economic Coordination Committee (ECC) approved Rs8,500 per 40kg as the intervention price on a summary submitted by the Ministry of National Food Security and Research to attract growers towards the crop.

Pricing

The ministry informed the ECC that in order to draw up a cotton intervention price proposal, consultations were held with all stakeholders including the provincial governments, growers and cotton associations in January and February.

Stakeholders, including the All Pakistan Textile Mills Association, called for pegging the cotton intervention price with the import parity price in line with the policy adopted over the past two years.

The ECC constituted a cotton price review committee with the mandate to review market prices and propose intervention on a fortnightly basis.

Comment by Riaz Haq on May 23, 2023 at 7:41am

Textile exports plummet by 14% to $13.7 billion
Attributable to global recession, challenging domestic environment


https://tribune.com.pk/story/2418100/textile-exports-plummet-by-14-...


KARACHI:
Pakistan’s textile exports have experienced a significant decline of approximately 14% during the 10-month period of fiscal year 2023, dropping to $13.7 billion, according to data released by the Pakistan Bureau of Statistics (PBS). This marks a substantial decrease from the previous year’s figure of $15.9 billion.


Experts attribute this slowdown to the global recession, resulting in lower export orders, combined with a challenging domestic environment. Insight Research, textile analyst, Asim Hassan states, “The slowdown is mainly attributable to the global recession resulting in lower export orders coupled with challenging domestic environment.”

In April 2023, textile exports witnessed a year-on-year decrease of 29%, amounting to $1.23 billion. Arif Habib Limited (AHL), Head of Research, Tahir Abbas notes that this marks the seventh consecutive year-on-year decline in monthly textile exports.

Topline Securities, textile analyst, Nasheed Malik explains that compared to April 2022, Pakistan’s textile exports were down by 29% year-on-year and 9% year-on-year in Pakistan rupee terms.

This decline is primarily attributed to a 29% and 32% drop in the value-added and basic segments, respectively. In the value-added segment, bedwear, knitwear, readymade garments, and towels witnessed declines of 22%, 34%, 29%, and 26% respectively.

In a month-on-month comparison, Pakistan’s textile exports for April 2023 stood at $1.23 billion, experiencing only a 2% decrease. Similarly, in Pakistan rupee terms, exports remained flat month-on-month, amounting to Rs351 billion, said Malik.

The value-added textile exports reached $867 million, maintaining stability month-on-month. Bedwear increased by 11% and knitwear by 3% compared to the previous month.

However, readymade garments witnessed a 10% decline, balancing out the overall export performance. Basic textiles decreased by 7% month-on-month, with cotton cloth and cotton yarn experiencing almost the same decline.

In terms of volume, bedwear and knitwear witnessed a positive trend, increasing by 9% and 3% respectively month-on-month. On the other hand, towels decreased by 3%, and readymade garments remained flat compared to the previous month.

Malik highlights that textile manufacturers in Pakistan have observed improved orders from Europe and the United States for the value-added segment, as indicated by the resilience in volumes. However, among basic textiles, cotton yarn decreased by 8%, and cotton cloth declined by 6% month-on-month.

Insight Researches’ analyst acknowledges that textile exports have remained sluggish due to various challenges in the domestic environment and weakening global demand. He expects textile exports to increase in volumetric terms as the inventory pileup gradually declines and demand resurges in export destinations.

However, the decline in product prices is likely to offset the impact. Additionally, headwinds in the domestic economy, such as unavailability of locally produced cotton, delays in clearance of imported cotton and other essential inputs, elevated gas and electricity tariffs, and increased finance costs, will continue to hinder textile players.

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