Steadier trend was seen on the cotton market on Saturday following the news that the Securities and Exchange Commission of Pakistan (SECP) allowed future trade in cotton and the news that India would fix quota on cotton yarn export, dealers said.
The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 9,000, 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, more than 4000 bales of cotton changed hands between Rs 7000-8500, they added. Market sources said that prices showed slight firmness after the news that the SECP permitted future trade in cotton and other news is speculated that India has fixed quota on export of cotton yarn.
Now the ginners were trying to increase the asking prices instead of panic selling, some analysts said. Besides, Naseem Usman welcomed the move by the SECP but he said that the decision is somewhat surprising for the members and brokers of the Karachi Cotton Association (KCA) as the SECP is allowing the future business at the Pakistan Merchantile Exchange Limited (PMEX) instead of to the KCA members and brokers.
On Friday the US cotton futures finished mixed as the market appeared to be stabilising after a savage sell-off in the commodity sector over the last few sessions, analysts said. "Cotton's trying to hold its own," said Mike Stevens, an independent cotton analyst in Louisiana. "It's stabilising, but the interest on a Friday is at a very low level."
The key July cotton contract on ICE Futures US fell 1.30 cents to settle at $1.4556 per lb, trading from $1.438 to $1.491. It was the lowest close for cotton in almost four months, Thomson Reuters data showed. The new-crop December cotton futures rose 0.21 cent to close at $1.2229 cents per lb. Volume traded stood at almost 12,000 lots, around 50 percent below the 30-day norm, Thomson Reuters preliminary data showed.
Traders said investors were unwinding positions in the benchmark July cotton contract since old crop supplies are practically gone and turning their attention to December, against which producers will price the upcoming 2011/12 cotton crop. They added that consumer demand has also started showing up in the December contract, lending support to the market. The market will be looking for leads next week on buying intentions by mills from China, the world's leading consumer of cotton, analysts said.
Open interest in the cotton market dropped to 148,291 lots as of May 5, the lowest level since October 2009, from 149,172 lots in the previous session, data from ICE Futures US showed. Volume traded in the cotton market was at 10,679 lots as of May 5, versus the previous tally of 10,679 lots, exchange data reported.
Steamed beans may sour record coffee price gap The following deals were reported: 400 bales from Mir Pur Khas sold at Rs 8400, 300 bales from Mir Pur Khas at Rs 7800, 800 bales from Khipro at Rs 8450, 1000 bales from Rohri at Rs 8000, 903 bales form Dharki at Rs 8500, 400 bales from Shujabad at Rs 8500, 811 bales from Haroonabad at Rs 8200-8500 and 200 bales from Burewala at Rs 7000, (delivery for July), they added.
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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 06.05.2011
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37.324 Kgs 9,000 120 9,120 9,120 NIL
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Equivalent
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40 Kgs 9,645 120 9,765 9,765 NIL
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