Rebound in New York cotton futures helps prices to resist further fall
December 11, 2010
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Influenced with the NY cotton market track the domestic cotton prices resisted further slide on the cotton market on Friday, dealers said.
The Karachi Cotton Association (KCA) spot rate, which came down sharply during the last sessions, resisted fresh fall holding the overnight level at Rs 8,800.
In ready business trading was subdued as approximately 10,000 bales of cotton changed hands between Rs 8,500-9,000, they added.
Rebound in the NY cotton futures trade after several factors, helped the domestic cotton prices to resist further decline, they said.As a whole it appeared that mills, who were able to pay better rates to the sellers, were grabbing the best quality of cotton, the said.
Commenting on the slow trade and higher prices some experts said that there were some uncertainties among the buyers due to falling in Indian exports' news.
Presently no one was sure about the correct number of cotton exports from India, besides, many other buyers were on the sidelines due to year-end payments and also ahead of local holidays.In the meantime a few analysts observed that to bring down prices further, the mills and exporters made concrete efforts by curtailing the daily intake, now it is interesting to note that prices are again on upward trend.
In fact trend in the country market is influenced by the international track, analysts said.In the world market, fundamentally, the market received a boost from a report that India may miss its cotton export estimate of 5.5 million bales as well as a strong showing for US cotton in weekly export sales data from the US Agriculture Department.
US cotton exports stood at 436,600 running bales (RBs, 500 lbs each), above trade forecasts ranging from 300,000 to 400,000 RBs.
The trade will now turn its focus to the USDA's monthly supply/demand report, particularly its cotton estimates for China, Pakistan and India.On Thursday the US cotton futures finished up by their daily limit on investor buying spurred partly by strong export sales and talk that Indian cotton exports may fall short of trade expectations, brokers said.The benchmark March cotton contract on ICE Futures US rose by the 4.00-cent limit to finish at $1.3595 per lb, with the session low at $1.2967.
Trading volume hit 13,340 lots, about two-thirds below the 30-day average of 35,361 lots, Thomson Reuters preliminary data showed.
That would be the lowest daily volume since October 6.The following deals were reported: 600 bales of cotton from Nawabshah sold at Rs 8500-8700, 400 bales of cotton from Burewala at Rs 8700-8800, 1000 bales of cotton from Tando Adam at Rs 8500-8600, 200 bales of cotton from Jahanian at Rs 8700, 1000 bales of cotton from Shahdad Pur at Rs 8500-8700, 200 bales of cotton from Tiba Sultan Pur at Rs 8800, 600 bales of cotton from Khair Pur at Rs 8700, 200 bales of cotton from Vehari at Rs 8800, 600 bales of cotton from Haroonabad at Rs 9000, 200 bales of cotton from Kacha Khu at Rs 9000, 800 bales of cotton from Upper Sindh at Rs 8600-8750, 200 bales of cotton from Liaquat Pur at Rs 9000, 200 bales of cotton from Faqir wali at Rs 8600, 200 bales of cotton from Samandari at Rs 9000, 800 bales of cotton from Chistian at Rs 8700-8800, 400 bales of cotton from Sadiqabad at Rs 9000 and 400 bales of cotton from Hasil Pur 8700 at Rs 1000.
Copyright Business Recorder, 2010
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