Asian viscose staple fibre markets in Asia although described as quiet in the week ended 17 January 2014, prices continued to move up. However, as downstream mills in China were in the process of idling for Lunar New Year holiday, they were largely unreceptive to new prices and were not interested in building stock before the holidays. This implies that they expect prices to soften post holidays. Prices in India and Pakistan generally rolled over in an inactive week.

Cost support was still firm for viscose producers. Discussions for softwood pulp were heard at US$920-930 a ton while those for hardwood pulp were at US$870 a ton.

In China, medium-end VSF were pegged at US$2.02-2.03 a kg, with trading values at US$1.98-2.00 a kg. High-end VSF were firm and talks were in the range of US$2.06-2.08 a kg. Low end VSF were at US$2.05 a kg. Indian VSF prices rolled over at US$2.22-2.33 a kg while domestic prices in Pakistan were steady at US$2.23 a kg in the Karachi market.

Viscose markets were also supported by the firming cotton prices across markets, as spinner will switch to low priced fibre. This week, the US Cotton Futures hit a near 5-month high and ended the week up 5 percent as strong speculation drove buying and strong US exports stoked worry over tight supplies in the world's top exporter, even as world inventories balloon. The benchmark March cotton contract on ICE Futures US closed up US cents 4.21 on the week.

Cotlook A index also gained US cents 4.50 In Pakistan, cotton prices moved up sharply on rising demand by mills and spinners. The Karachi Cotton Association (KCA) spot rate was added PakRs50 this week ending at PakRs 7205 per maund. In India, demand for cotton softened on increased market arrivals, resulting in prices of lint and raw cotton falling. India is estimated to have produced 37.6 million bales (170 kg each) during the current season ending September, an increase of 5 per cent, said the Cotton Association of India

Courtesy - Weekly PriceWatch Report