KCA raises spot rate by Rs 25

The official spot rate was modestly higher following the heavy rains in Sindh and Punjab, dealers said at the cotton market on Thursday.
It seems that good days are ahead for the ginners as they might be able to sell unsold cotton at season's peak level in the near future due to delay in picking operation because of rainy season in the both the Punjab and Sindh, dealers said.
The Karachi Cotton Association (KCA) official spot rate was up by Rs 25 to Rs 2625, and As a result of fresh rains, a deal of some hundred bales of cotton struck at Rs 2800, they said.
According to the market sources, the current rains in the cotton growing areas are good for the crop. Timely rains are good and might not hurt the production as was speculated earlier.
Some cotton analysts said that several deals are in the pipeline between the ginners and mills as spinners were trying to grab all the lots on hovering fears that prices may touched the highest mark of the season.
There appears a possibility of softness in the cotton prices after the arrival of consignments of lint from India and some other parts of the world, they guessed.
An important factor is that the NY cotton market is showing an upward trend most of the time. The NYBOT's key December cotton contract settled up 0.24 cent, or 0.4 percent, at 61.69 cents a lb on Wednesday, after trading between 60.65 and 62.25 cents. Since Monday's close, the contract has gained almost 1.5 percent.
The rally comes amid trade expectations for a sizeable reduction in the acreage of cotton when the US Department of Agriculture issues a scheduled plantings report on Friday.
The solo deal was reported as some 1200 bales of cottton from Shujaabad at Rs 2800 Spot rates of cotton (Crop 2006-2007).

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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"

 MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL

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Rate           Ex-Gin     Upcountry    Spot Rate Ex-Karachi

for            Price                        Sales Tax @ 15%

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37.32 Kgs      2625.00        50                    2675.00

Equivalent-------------------------------------------------

40 Kgs         2813.00        50                    2863.00

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