Thin activity was seen on the cotton market on Friday as mills were still sidelined due to less purchasing interest, dealers said. Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 13000, they said. In Sindh and Punjab Phutti prices of low type were inert at Rs 4500 and superior variety came down sharply by Rs 400 to Rs 6000, they said.
In ready business nearly 1000 bales of cotton changed hands at Rs 13200-13500, they said. Market sources said that mills were double minded due to prevailing uncertainty in the local and international market. During the last two sessions, prices fell in the global market, which forced the local buyers to adopt wait-and-see attitude, they said.
Explaining the recent upward trend in the cotton prices, some analysts said that the current demand and supply factor signalling the declining stock in the cotton producing countries, mainly India and the US due to panic buying by China and other major countries. This factor is giving an impression that the prices may not drift lower sharply in the coming days, they said.
In the meantime, country's textile sector may face some setbacks, whose major share in the foreign exchange is nearly 65, they said. How they will tackle the emerging situation in the world competitive markets?, because of soaring prices, they seened not so sure.
On Thursday US cotton futures closed lower mostly on spread trade and investor sales as players paid little heed to a pair of government reports, analysts said. The key May cotton contract on ICE Futures US fell 3.43 cents to finish at $2.0098 per lb, trading from $2.0038 to $2.0771.
Open interest in the market, an indicator of investment exposure in cotton, stood at 175,133 lots as of March 9, recovering slightly from the 7-1/2 month low at 173,688 lots as of March 8, data from ICE Futures US showed. There was no discernible boost given to the cotton market by the reports from the US Agriculture Department (USDA), which the trade believes should have had a bullish impact on fibre contracts.
The following deals were reported: some 800 bales of cotton from Khan Pur sold at Rs 13500 and 200 bales of cotton from Rahim Yar Khan at Rs 13200, they added.
===========================================================================
The KCA Official Spot Rate for Local Dealings in Pak Rupees
---------------------------------------------------------------------------
FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"
---------------------------------------------------------------------------
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
===========================================================================
Rate Ex-Gin Upcountry Spot Rate Spot Rate Difference
For Price Ex-Karachi Ex. KHI. As Ex-Karachi
on 10.03.2011
===========================================================================
37.324 Kgs 13,000 120 13,120 13,120 NIL
---------------------------------------------------------------------------
Equivalent
---------------------------------------------------------------------------
40 Kgs 13,932 120 14,052 14,052 NIL
===========================================================================
Comments
Comments are closed for this article.