Transaction at low ebb in absence of leads on cotton market

Small business was seen on the cotton market on Thursday as some needy mills stuck deals to meet the urgent needs, dealers said. Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 12,000, they said. In Sindh and Punjab, phutti price of low type was at Rs 4000 and superior type also unchanged at Rs 5000, they said.
In ready business nearly 2,400 bales of cotton finalised between Rs 12000-13000, they added. According to the market sources, mills were not very active in the absence of leads. It is expected that daily-intake by mills may take a lift in the near future, they said. On Tuesday the US cotton futures closed up their daily trading limit as modest investor buying was featured in otherwise subdued dealings, analysts said.
The key May cotton contract on ICE Futures US rose the seven-cent limit to end at $2.0596 per lb, with the session low at $1.9743. The contract has been limit-up in three of its last four sessions.
Volume of around 14,400 lots was over 50 percent below the 30-day norm, Thomson Reuters preliminary data showed. Open interest, an indicator of investment exposure, stood at 174,321 lots as of March 21, still near its lowest point since late July 2010, data from ICE Futures US showed.
On Wednesday the US cotton futures settled lower on investor profit-taking as the failure to extend the market's advance prompted players to liquidate positions in fibre contracts, analysts said.
The key May cotton contract on ICE Futures US fell 4.09 cents to end at $2.0187 per lb, dealing between $2.0997 and $1.9896, which was down the 7-cent trading limit. The volume stood at around 24,000 lots, about a fifth below the 30-day norm, Thomson Reuters preliminary data showed.
Open interest in the market, an indicator of investment exposure, stood at 176,065 lots as of March 22, a level that is above an 8-month low, data from ICE Futures US showed.
The following deals were reported: 400 bales of cotton from Salah Pat sold at Rs 13,000, 200 bales from Yazman Mandi and 1800 bales from Khan Pur at Rs 12,500.

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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 22.03.2011

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37.324 Kgs      12,000       120      12,120       12,120               NIL

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Equivalent

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40 Kgs          12,860       120      12,980       12,980               NIL

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