Mills show interest in forward covers
Mills showed fresh interest in the purchase of fine type at present or mutually agreed prices in anticipation of rise in rates in the coming days, dealers said. Official spot rate was unchanged at Rs 6000, they said. Prices of cottonseed (phutti) in Sindh at Rs 2300-2700 and in Punjab rates were at Rs 2400-2800, they said. In ready business, above 15,000 bales of cotton finalised between Rs 5400 and Rs 6100, they said.
Copyright Business Recorder, 2013
Market sources said that mills showed fresh interest in purchasing of cotton to meet the requirements. It is expected that the prices may stabilise due to slight fall in production, they said. The Pakistan Cotton Ginners Association (PCGA) issued fortnightly report till January 1, 2013 is about at 11.6 million bales, showing a fall of nearly five lack bales against the last year, they said.
According to the Reuters: the US cotton closed higher on Wednesday as relief swept across the commodity market after an eleventh-hour deal by lawmakers averted the so-called "fiscal cliff" and offset weak sentiment and a stronger dollar. Initial euphoria over the US budget agreement, which for now prevents the world's largest economy falling off the "fiscal cliff" of drastic tax rises and spending cuts and into recession, pushed prices as high as 76.95 cents early on the first day of trading in 2013.
But prices swooned briefly in early afternoon trading as the US dollar recovered against the euro and grain prices tumbled, only to recover by the close as new speculative money rushed into commodities across the board. Fibers remain vulnerable to pressure without support from strong supply-and-demand fundamentals, brokers said. "The (budget deal) drove cotton up today, but it won't last," said one US broker. "If we break close to 74.38 cents, technically the market will be wounded."
The most-active March cotton contract on ICE Futures US settled up 0.22 cent, or 0.30 percent, at 75.36 cents per lb. While the market traded in a wide 2-cent range, it still held its recent trend and might be consolidating in a sideways move, analysts said. The front-month garnered support from technical buying after hitting its 20-day moving average at 74.88 cents.
The following deals were reported: 400 bales of cotton from Tando Adam at Rs 5400, 400 bales from Shahdadpur 5725, 400 bales from Khairpur (BCI) at Rs 6100, 4600 bales from Upper Sindh (BCI) at Rs 6100, 400 bales from Arifwala at Rs 5875, 200 bales from Burewala at Rs 5900, 200 bales from Qabola at Rs 5900, 400 bales from Kassowal at Rs 5900, 400 bales from Chichawatni at Rs 5900, 1400 bales from Fort Abbas at Rs 5950, 400 bales from Mian Chano at Rs 5950-6000, 800 bales from Shadan Lund at Rs 6000-6050, 1200 bales from Rahimyar Khan at Rs 6000-6100, 200 bales from Tonsa Sharif at Rs 6050, 400 bales from Haroonabad at Rs 6050, 1000 bales from Sadiqabad at Rs 6100, 800 bales from Mianwali at Rs 6100 and 400 bales from Rajanpur at Rs 6100, they said.