Thin trading activity was again witnessed on the cotton market on Wednesday because of lack of buying interest among spinners, dealers said. The official spot rate was unchanged at Rs 5500, dealers said. In the ready session, some 800 bales of cotton changed hands between Rs 4600 and Rs 5600, they said. Cotton analyst, Naseem Usman said that leading participants were conspicuous by the absence.
He attributed continued fall in the business activity to less buying interest and short supply of quality lint. Besides, the issue of the Gas Infrastructure Development Cess (GIDC) is also an issue, which is pushing the participants on the sidelines, he added. Measures announced in budget to propose 50 percent rise in the sales tax on exports had negative impact on the textile industry, other analysts said.
The new tax measures, GIDC and petrol price hike would discourage investors and textile industry, as well, they said.
Reuters adds: ICE cotton futures inched up on Tuesday, as funds continued to roll long positions forward and investors covered shorts amid expectations the US government will raise its forecast for US cotton exports in its monthly World Agriculture Supply and Demand Estimates Report. The most-active December contract on ICE Futures US settled up by 0.03 cent on Tuesday at 65.37 cents per pound. It traded within a range of 65.15 and 65.95 cents a pound. The December contract's premium to the July contract rose to 0.82 cent per lb from 0.54 the prior session. The following deals reported 100 bales of cotton from Hasilpur at Rs 4600, same figure from Multan at Rs 4850 and Rs 600 bales from Rahim Yar Khan at Rs 5600, they said.
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The KCA Official Spot Rate for Local Dealings in Pakistan 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 09.06.2015
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37.324 Kgs 5,500 150 5,650 5,650 Nil
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Equivalent
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40 Kgs 5,894 160 6,054 6,054 Nil
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