Activity improved on the cotton market on Thursday following exporters' participation in buying and partly because of recovery in the NY cotton futures, dealers said. The Karachi Cotton Association (KCA) official spot rate was inert at Rs 8,500, 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 6000 bales of cotton changed hands between Rs 6,500-8500, they added. According to the market sources exporters showed interest in fresh buying due to lower rates and demand increased by the foreign buyers and partly because of shortage of cotton to meet the local demand. It is felt that country is facing shortage problem to meet the export consignments, they said adding that falling demand of cotton yarn in local and international market also creating problems for the spinning sector.
Apart from other factors prices are on the down side because of expectations for better cotton production in the next season, they said. Besides, according to a report Ivory Coast has forecasted to produce 216,000 tonnes of cotton in 2011-2012, up from around 175,000 tonnes the previous season, the executive secretary of the cotton ginners association said on Wednesday.
Ivory Coast, the world biggest cocoa producer, was also one of the West African region's major cotton exporters, with an annual output of about 400,000 tonnes, before a 2002-2003 civil war halved the production. On Wednesday the US cotton futures reeled from investor sales to finish lower as another round of liquidation hit the commodities sector, analysts said. The key July cotton contract on ICE Futures US dropped 1.10 cents to settle at $1.503 per lb, dealing from $1.4776 to $1.5512.
The new-crop December cotton futures shed 0.73 cent to close at $1.2519 cents. Volume traded stood at around 17,600 lots, about a quarter below the 30-day norm, Thomson Reuters preliminary data showed. "The spill-over from crude, silver and gold and the sharply higher dollar hit cotton," said Keith Brown, president of commodity firm Keith Brown and Co in Moultrie, Georgia.
The following deals were reported: 300 bales of cotton from Odiro Lal sold at Rs 6500, 200 bales of cotton from Sanghar at Rs 7800, 1000 bales of cotton from Rohri at Rs 8000, 400 bales from Rohri at Rs 8500, 200 bales from Faqir Wali sold at Rs 7700, 300 bales from Vehari at Rs 8000, 200 bales from Mian Channon at Rs 8000, 200 bales from Faqir Wali at Rs 8000, 800 bales from Lodhran at Rs 8200, 200 bales from Shujabad at Rs 8200, 200 bales from Ahmad Pur East at Rs 8500 and 1800 bales from Kabir Wala at Rs 8500, 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 11.05.2011
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37.324 Kgs 8,500 120 8,620 8,620 NIL
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Equivalent
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40 Kgs 9,109 120 9,229 9,229 NIL
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