Pakistan Textile Exports Surge by 17.9% in September 2024

Fabric Rolls, textile, hygiene

The textile industry of Pakistan made the headlines in September 2024, when exports increased by a whopping 17.9% yoy. During the month, textile exports were $1.605 billion as compared to $1. This is the second month in a row that exports have grown at rates even higher —as solid export of made-up textile commodities pulls the growth.

The numbers point to an ever-more competitive world for Pakistani textile sector, despite economic hardships at home and competition globally. Pakistan has been riding on finished goods till now, and this is also one of the major reasons why Pakistan is growing in terms of agro-exports,you see they have to shift from raw material exportation towards completely made up value based consignment.

Growth Fuelled By Finished Goods Exports

To me, the single most indicative trend from this data is that finished goods are being targeted far more often than raw or unfinished items. It is in line with the shift taking place from Pakistan’s textile industry to more profitable ready-to-wear and value-added items for treatment on a global scale. Among these, ready-made garments emerged as the best performer during September, growing at an astonishing 35%.

In Pakistan as well, the trend is becoming common among exports activities rather than focusing on individual executed goods — lucrative aspect for revenue generation and higher margin. This transformation not only adds more value to the exports of the country but also positions Pakistan as a significant player in global textile supply chains due to its high quality finished products.

Top 10 Commodities to Lead Export Basket

The divide of best/worst performing textile categories indicates the altered strength and diversity within the sector:

Readymade Garments: Exports rose 35 percent to $338.4m on strong demand from European and North American markets;

Knitwear: Pakistan also performed quite well in this sector and managed to accumulate around $448.3 million, escalating by 29.57% over the same month last year and proving that as a consistent source of high-quality knitted garments, it continues to remain one of the prominent vendors on global product segments .

Cotton Cloth $201 million: Exports of Cotton cloth witnessed a growth of 15.33%, courtesy increasing demand for fabric from important Asian and African markets yielding highest returns to the tune of US$208bn during FY19, benefiting Pakistan in particular due largely by freer tariff elimination on specific items mélange gray fabrics as continued hovering around prosthetic levels received across entire period FY019 relieving the industry about duty-free market access that led to have better ones functioning with others throughout this cycle ex post results sharply pushed give even year now showcasing begetment demonstrating certain perceivably serving salty demanding faces hence freeing food supply availability thereby inhibiting From essentials counteroffer at imported requires not allowanced excision _ labeling mask every menace races back crouch tasks.

Export of Raw Materials Suffers a Decline

Raw materials, in contrast to finished products were respectively 20% and 10%. This decline is indicative of a long-term trend in the structural transformation underway in Pakistan’s textile sector, with an increasing focus on higher value-added goods as opposed to raw material exports.

Cotton Yarn: Decrease in exports by 54.22% to ($52 million)

Raw Cotton: While exports of raw cotton had also dropped to zero as local demand takes precedence for value-added textile production.

To be honest, restricting raw material exports was part of this move to curtail dependence on low-margin products that can actually lead to negative margins layered with limitation of free cash flow, whereas focusing instead on finished goods routes in bettering the possibilities for exporters.

Performance (General) FY 2023 -24

Total textile exports of Pakistan reached $16.65 billion in fiscal year 2023-24 (July-June), marking a slight yearly increase of 0.9 percent, over the value recorded during the same period a year ago. While the total annual growth was quite small, this is still a nice demonstration of the resilience of fintech in an world where we are experiencing continued global financial challenges. The fiscal year was marked by headwinds –global inflation, supply chain disturbances and volatility in raw material prices which proved to be the challenge factors at play

Food Exports Growth

While September export growth was not limited to the textiles sector, the food sector experienced pleasing growth, with exports recording a 6.36% growth to $604.75 million. The growth was primarily driven by a 49% surge in rice exports amounting to $257 million. Basmati Rice: Exports grew by 10% to $70.6 million and non-Basmati exports amounted to $186.6 million after a 72% growth. Meat & Vegetables: Meat exports slightly increased by 1.36% to $40.5 million, and vegetable exports grew by 12.6% to $20.65 million. Sugar: Sugar exports were estimated to be $28.26 million, compared to zero exports in the same month of the prior year. Exports of fish and fish preparations declined by 20%.

Fruit declined by 14.2%. Other Sectors:

Nothing to do – Exports reduced by 1.9% to $31.1 million, and footballs dropped by 9.76%. Surprisingly, Pakistan is a major global supplier of footballs, especially for major international events. Surgical Goods & Medical Instrument: Exports of surgical goods and medical instruments increased by 2.97% to reach $40.1 million. The country’s medical equipment exports are part of a broader wave of boom-of affordable healthcare solutions. Cement: Exports increased by 5.36% to stand at $28.5 million. Petroleum Imports Gains and Losses: Petroleum imports rose by 4.33% to $1.39 billion, driven by a 23.6% increase in LNG and 79.92% in LPG. Imports for crude oil slightly dropped by 1.14% and petroleum products by 5.6%.

Machinery Imports Surge

Machinery imports into Pakistan experienced the largest upswing in September 2024, rising by an annualised average of $711.4mn or 36.2%. Here is a breakdown of major sections:

Textile machinery increased by 42.2 percent  probably maintained to invest in establishment of more modern and efficient manufacturing units_pakistan earlier with part of the expected investment for upgradation process if not compliant yet.

Machinery for Power Generation: Income net of 72.3% to $57, three million led by power infrastructure usefortress.

Agricultural Machinery : Imported over 133% with total volume of $12.1 million as Pakistan aspire to turn its agricultural productivity around;

The increase in imports is driven by the transport sector

The transport sector also had a good month in September, helped by wider weakness than usual — with total imports 37 per cent higher. Key areas of growth included:

Road Motor Vehicles: Imports of built units and CKD/SKD kits rose by 33.2 percent to $166.3 million

Buses, trucks and other heavy vehicles: Buses‐trucks – oth h/vehicles where imports rose by 17%Equaled to$25.9 million

Motor CarsImports +28.9% to $20M (year ended Feb 21) CKD/SKD imports for cars +48.4% to $80.5 M.

Category Breakdown: Who’s Winning? 🏆

Let’s dig into the numbers:

  • Cotton Cloth: Up 15.33% to $201 million
  • Knitwear: Up 29.57% to $448.3 million
  • Bedwear: Up 24.8% to $290.2 million
  • Towels: Up 7.35% to $90.55 million
  • Ready-made Garments: Up 35% to $338.4 million (Wow!)

Conclusion

Striving towards diversifying its export base for more value-added productions, September 2024 was an auspicious month in that it seemed to mark a ‘turning of the corner’ as far as Pakistan’s textile sector -that drives much of the country’s economic growth- is concerned. The uptick was broadbased — both textiles and food exports did well –and highlights that Pakistan is in a good position to take advantage of global demand trends which are just beginning to develop. But the continuous restraints in raw exports and ups & downs of other segments, like sports goods indicate that our country is required to be proactive enough as per changing trading pattern.

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