Surge in value-added exports lifts Textile Exports in 7MFY20

February 19, 2020 (MLN): The overall exports of the textile group, during the month of January 2020 stood at $ 1.19 billion i.e. around 4.59 % higher as compared to the previous month and an increase of 2.25% as compared to the same period last year.

According to the research note by BIPL securities, the meagre YoY increase was attributed to a 3% YoY increase in the value-added exports on the back of an increase of 5% YoY in readymade garments when compared with the same period last year. Also, the non-value added export slightly went up by 1% YoY due to cotton yarn exports, registering an increase of 10.4% YoY.

On a sequential basis, a 4.59% increase in textile exports was accredited to a growth of 20% MoM in non-value added textile exports. Conversely, the value-added part showed a negligible growth of 1% MoM as per BIPL research.

During 7MFY20, the overall exports of textile group witnessed an increase of 3.68% YoY to stand at $8.09 billion against $7.8 billion, as per the latest data issued by the Pakistan Bureau of Statistics on export receipts by commodities.

The segment-wise analysis revealed that value-added reported growth of 6% while non-value added depicted the decline of 2% on a cumulative basis, the research added.

The report highlighted that cotton production stood at 8.6 bales, down by 20% YoY as opposed to 10.7 bales in the same period last year. The key reasons for the low productivity of cotton crop were heatwave, heavy rainfall and pest attacks.

Going forward, it is expected that textile exports might suffer in the medium term on account of ongoing Coronavirus in China which might hamper Pakistan’s exports with China, the report added.

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