Post-holiday session on cotton market spent on exchanging Eid greetings

Most of the participants were busy in exchange of Eid greetings during post-holiday session on the cotton market on Thursday, dealers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 5,450, they said.
Prices of seed-cotton of low type in Sindh were down by Rs 200 at Rs 1800 and rate of fine quality was unchanged at Rs 2400.Rates in Punjab were inert at Rs 2200 while rate of good type was lower by Rs 100 to Rs 2500, they said. In ready dealings about 1200 bales of cotton changed hands at Rs 3,800, they said. After Eid-ul-Azha holidays, main participants were busy in exchange of Eid-greetings, some analysts said. It looks that normal trading will start from next week, they added. In the meantime, exporters' entry into the market gave an impression that prices may not fall sharply, they opined.
But some other brokers said that in India prices of cotton fell as before one-week, cotton was at 92 cents per pound, now prices came down to 85 cents, which is not very good development under the circumstances. According to the reports, cotton arrivals in Indian spot markets fell 30 percent in October as non-seasonal rains delayed harvesting of the crop, an official at the state-run Cotton Corp of India said on Tuesday.
Arrivals stood at 1.48 million bales of 170 kg each as on October 30, compared with 2.1 million bales a year ago, the official, who requested anonymity, told Reuters. "Rainfall in north India delayed harvesting. It has been picking up and from next week we will see a sharp rise in arrivals, especially from Punjab, Maharashtra and Gujarat," he said.
Another report said that China is seen importing 3.3 million tonnes cotton this year, up 22.22 percent from last year's 2.7 million tonnes, a top industry body official said on Monday. The international cotton year is from August to July.
China is expected to produce seven million tonnes of cotton this year, while its consumption is seen at 10 million tonnes, Terry Townsend, executive director of International Cotton Advisory Committee told reporters on sidelines of World Cotton Research Conference. China is the world's largest exporter of textiles with a global market share of 28.3 percent last year, or 6.6 times India's share of 4.3 percent, Indian government data show.
On Monday the NY cotton futures slid to a weak close as index fund rolling put pressure on fibre contracts while another round of euro zone worries put financial markets on the defensive, dealers said. The key December cotton contract on ICE Futures US dropped 1.98 cents or by 2 percent to close at 96.76 cents per lb, moving from 96.51 to 98.96 cents.
Total volume traded Monday hit almost 25,700 lots, about two-thirds over the 30-day norm, preliminary Thomson Reuters data and ICE Futures US data showed. On Tuesday, the US cotton futures settled higher on late investor short-covering as the market staged a rebound after hitting its downside technical objectives, analysts said.
The key December cotton contract on ICE Futures US rose 0.86 cent to conclude at 97.62 cents per lb, moving from 95.96 to 97.96 cents. Total volume traded Tuesday hit almost 28,200 lots, more than three-quarters above the 30-day norm, preliminary Thomson Reuters data and ICE Futures US data showed.
On a technical level, dealers said the downside targets in cotton used to be the recent low of 96.47 cents, basis March. When that was breached in Tuesday's session, independent analyst Mike Stevens in Louisiana said the next target became "the lower end of the Bollinger Band (at) 95.78 (cents)." The March cotton contract came to within a hair of hitting 95.78 and then began coming back as the selling spree dried up.
On Wednesday, the NY cotton futures settled lower on investor sales and switch trade as macro weakness in Europe spilled into fiber contracts, although late short-covering pared losses, analysts said. The key December cotton contract on ICE Futures US fell 0.44 cent to conclude at 97.18 cents per lb, moving from 96.62 to 98.18 cents.
Total volume traded Wednesday hit around 20,300 lots, nearly a quarter above the 30-day norm, preliminary Thomson Reuters data and ICE Futures US data showed. Stocks and the euro tumbled Wednesday as Italian borrowing costs spiked, raising fears the country will be forced to seek a bailout that could overwhelm the euro zone's finances and push the region into recession.