Firmness prevailed on the cotton market on Thursday during the subdued business because of absence of active mills demand, dealers said. The Karachi Cotton Association (KCA) spot rate was unchanged at Rs 9000, they said. Seed cotton prices in Sindh and Punjab moved up at Rs 3,900-4,300, they said.
In ready business, approximately 7,000 bales of cotton changed hand between Rs 9000-9400, they said. Some brokers said that much activity was not witnessed as mills and ginners failed to find a meeting ground in the absence of guiding factors. They said that some mills took little interest as present rates were not matching with their psychological levels. It looks that present lacklustre condition may continue and normal business activity likely to begin in the middle of the first week of the New Year 2011, they said.
The mills are on the sidelines in expectations of slide in the prices but it is general perception in the market that the rates may go up due to short crop, some experts said. Cotton traders were mulling to import cotton from India as the stuff is cheaper against the other source, they added.
Most of the ginners tried to keep away from the market, not inclined to make any deal below the psychological level in view of short crop, they said. They also said that China is likely to lead the major importers of cotton yarn from Pakistan and this factor is making the spinning sector unable to make any option. Meanwhile, India's cotton export deadline will expire on February 25, Trade Secretary Rahul Khullar said on Thursday, for the remaining unshipped quantity of the 5.5 million bales allowed for overseas sales in the 2010/11 season. India, the world's second top cotton producer, has asked exporters to apply for cotton registration certificates between December 31 and January 6 for the unshipped quantities in the current season that began on October 1.
Khullar said the shipment for the remaining 2.5 million bales would start from January 11. According to a report Australia is set to reap a record cotton crop in 2011 despite crop losses caused by severe flooding in north-eastern Australian state of Queensland, a top cotton trading firm said on Thursday.
About 7,500 hectares of crop had been destroyed in Queensland state but that represented little more than one percent of 665,000 hectares planted across Australia, Industry body Cotton Australia said. On Wednesday the US cotton futures finished lower for the second straight session on investor liquidation although the market managed to hold the lower end of its trading range, analysts said.
The key March cotton contract on ICE Futures US declined 3.93 cents or 2.72 percent to finish at $1.4043 per lb, moving from $1.4038 to $1.4635. Volume was seen around 12,800 lots, about 50 percent below the 30-day norm, Thomson Reuters preliminary data showed.
The cotton market is one of the best performing commodities in the Reuters-Jefferies commodity index, up almost 75 percent year to date as the market rallied to hit levels that have not been seen since the US Civil War in the 19th century.
The following deals were reported : 800 bales of cotton from Shahdad Pur sold at Rs 9000, 600 bales of cotton from Nawabshah at Rs 9000, 1000 bales of cotton from Khair Pur at Rs 9300, 2000 bales of cotton from Upper Sindh at Rs 9300-9400, 400 bales of cotton from Faqirwali at Rs 9200, 200 bales from Fort Abbas at Rs 9200, 800 bales from Haroonabad at Rs 9250, 400 bales from Khanewal at Rs 9300 and 400 bales from Rajan Pur at Rs 9300.
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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 29.12.2010
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37.324 Kgs 9,000 120 9,120 9,120 Nil
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Equivalent
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40 Kgs 9,645 120 9,765 9,765 Nil
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