Prices continued to decline for the second day on the cotton market on Tuesday amid restricted buying by spinners and mills, dealers said. The official spot rate shed further Rs 50 to Rs 5,200, dealers said. In Sindh, seed cotton prices were at Rs 1500-2700, and in Punjab prices stayed put at Rs 1700 and Rs 2900, they said.
In the ready business, around 1200 bales of cotton changed hands between Rs 5100 and Rs 5400, they said. Commenting on the lethargic condition, cotton analyst, Naseem Usman said the ginners, who are suffering from losses, were trying to lower prices to attract buyers, but the spinners could not finalise deal even at the lower rate.
Other analysts said that huge quantity of import of fine quality hurting local market, so that the government should ban on imports of cotton.
Experts were of the view that the growers facing financial shortage due to unavailability of payments.
Adds Reuters: Cotton futures fell for a fourth straight session on Monday to the lowest since June 2009, as worries over demand in the world's top consumer China sparked selling early in the session and stop-loss orders exaggerated the day's declines.
China said on Monday it expects to lay off 1.8 million workers in the coal and steel industries, or about 15 percent of the workforce, triggering fresh fears over the economic strength of the top consumer.
The May contract on ICE Futures US settled down 1.03 cent, or 1.79 percent, at 56.5 cents per lb, breaching a key technical support level of 57 cents.
It traded within a range of 54.53, a contract low and the lowest since June 30, 2009, and 57.62 cents a lb.
The following deals reported: 400 bales of cotton from Yazman Mandi sold at Rs 5100, 632 bales from Burewala sold at Rs 5200 and 100 bales from Khanewal at Rs 5400, dealers 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 29-02-2016
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37.324 kg 5,200 135 5,335 5,385 -50
Equivalent
40 kgs 5,573 145 5,718 5,771 -53
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