Prices eace on panic selling by ginners

Panic selling by ginners eased prices on the cotton market in process of trading, dealers said on Friday. Karachi Cotton Association (KCA) official spot rate was downed by Rs 500 to Rs 9,500, they said. In Sindh and Punjab phutti price of low type was at Rs 2500 and that of superior type at Rs 3000, they said.
In ready business nearly 3200 bales of cotton changed hands between Rs 7,900-8500, they added. Market sources said that several factors caused continued fall in the cotton rates. They said that basic factor is lack of interest by the buyers and rising expectations for decline in the rates as prices went up during the last four-six months due to speculative buying in the international markets, which pushed the local prices to hit the record high level.
The mills are sidelined in anticipations of fall after the decline in the global market. Second major reason behind the thin business is expectations for bumper crop for the coming season, they said. The early reports reaching the market showing no pest attack or any negative impact on the fresh sowing and hopefully the target for 15 million bales may be achievable for the next season, Naseem Usman said.
Falling trend in the global market during the whole week, generally having bad impact on the local prices, in the meantime, the ginners, who were not willing to dispose of unsold stock now are selling the low quality following the fears of more decline in the rates, he said. Other brokers said that fine quality is available but above the Rs 10,000 level so, the mills preferred to remain sidelined to see prices come down to their psychological level.
On Thursday the US cotton futures were mixed, with nearby contracts falling and later-dated futures firming after steep selling in day-earlier business, but ample nearby supply was hurting May and July fibre prices. Most-active July cotton on ICE Futures US finished 1.37 cents lower at $1.5202, a 0.89 percent decline, after falling to the downside limit a day-earlier.
New-crop December cotton was up 1.98 cents, or 1.59 percent, at $1.2658 cents a lb. at the close. May cotton, which is undergoing deliveries, was down 2.07 cents, or 1.18 percent, to end at $1.7282 per lb. Thursday began with open interest of 5,350 lots for the May contract, only a slight decline from the 5,674 lots open as of Tuesday. Yet, delivery notices issued to date have been light.
The following deals were reported: 1000 bales of cotton from Rohri sold at Rs 8500, 200 bales of cotton from Rohri at Rs 8000, 400 bales from Gharmaraja at Rs 8000, 200 bales from Karor Pacca at Rs 8000, 200 bales from Haroonabad at Rs 8200, 200 bales from Lodhran a Rs 8000, 200 bales from Rahim Yar Khan at Rs 8000, 200 bales from Liyyah at Rs 8000 and 600 bales from Bakkhar at Rs 7900.

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The KCA Official Spot Rate for Local Dealings in Pak Rupees

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FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"

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                                    MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL

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Rate              Ex-Gin   Upcountry   Spot Rate    Spot Rate    Difference

                    For      Price     Ex-Karachi  Ex. KHI. As   Ex-Karachi

                                                  on 28.04.2011

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37.324 Kgs         9,500      120         9,620       10,120          - 500

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Equivalent

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40 Kgs            10,181      120        10,301       10,837          - 536

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