Prices maintained a surge on the cotton market on Friday as needy mills and spinners continued buying to keep the wheels moving to compete the challenges of the world, dealers said. The Karachi Cotton Association (KCA) spot rate was unchanged at Rs 9,900, they said. Seed cotton prices in Sindh and Punjab were at Rs 3,900-4,700, they said.
In ready business above 12000 bales of cotton changed hand between Rs 9,550-10500, they added. The feature of the day is prices touch Rs 10,500 mark, which means the rates may breach the record level of Rs 11,000 very soon, the market experts said.
They said that the government has imposed 3.5 percent Income Tax on agriculture products. As a result the cotton traders opposing the act and take out rallies and processions. It was noticed that buyers outstripped the sellers as demand was high following the continued rise in the prices of cotton, they said.
One of the major factors behind the persistent rise in the rates was textile exhibition in Germany, which has started from January 12 and will continue till 15 of current month. That's why sizeable number of exporters across the world are attending the fair to achieve booking orders, which would definitely help the prices to maintain the present levels or push them to go up further, experts said.
Secondly, textile ancillary industry has urged the government to make arrangements to regulate exports of cotton and yarn to stabilise rates in the local market, so that they will be able to compete the international challenges, they said. In the meantime, during some sessions, trading activity came down slightly as mills and spinners curtailed their daily intake to check further rise in the rates and were not inclined to go beyond their export parity levels, they said.
But it looks that this practice may not materialise because nobody can deny the fact that shortage of commodity may cause further increase in the prices inn the near future, they added On Thursday the US cotton futures settled sharply lower on investor profit-taking and producer sales ahead of a holiday weekend, with analysts saying the overall outlook for the market remained bullish.
The cotton market will be shut on Monday for the US Martin Luther King Jr. Day holiday. Trading reopens on Tuesday. The key March cotton contract on ICE Futures US fell 3.91 cents to settle at $1.4406 per lb, dealing from $1.4397 to $1.5163. Trading volume totalled around 25,000 lots, almost 40 percent above the 30-day norm, Thomson Reuters preliminary data showed.
The following deals were reported: 600 bales of cotton from Upper Sindh sold at Rs 10200, 200 bales of cotton from Burewala at Rs 9550, 200 bales of cotton from Vehari at Rs 9600, 400 bales of cotton from Bahawal Nagar at Rs 9600/9700, 400 bales of cotton from Samandari at Rs 9800, 200 bales of cotton from Chichawatni at Rs 9800, 200 bales of cotton from Muhammad Pur at Rs 9900, 200 bales of cotton from Layyah at Rs 9900, 1000 bales of cotton from Rajan Pur at Rs 9950/10000, 400 bales of cotton from Pul Bagarh at Rs 10000, 600 bales of cotton from Fort Abbas at Rs 10000, 400 bales of cotton from Mian wali at Rs 10000, 1600 bales of cotton from Sadiqabad at Rs 10000, 1200 bales from Rahim Yar Khan at Rs 10000/10200, 400 bales of cotton from Dera Ghazi Khan at Rs 10000, 400 bales of cotton from Rajan Pur at Rs 10000, 800 bales of cotton from Ahmed Pur at Rs 10000, 1000 bales of cotton from Noor Pur at Rs 10000, 1000 bales of cotton from Bahawal Pur at Rs 10000, 800 bales of cotton from Rajan Pur at Rs 10300/10500.
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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 13.01.2011
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37.324 Kgs 9,900 120 10,020 10,020 NIL
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Equivalent
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40 Kgs 10,610 120 10,730 10,730 NIL
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