Subdued business was seen on the cotton market on Saturday as leading buyers were conspicuous by their absence, dealers said. Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 12,500, 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, approximately 2000 bales of cotton changed hands between Rs 11800-12600, they added. No change was seen in present outlook as both buyers and sellers kept to the sideline due to spread of chaos after the tax measures, including textile sector, some analysts said.
It was noted that business activities slowed down for the last several sessions owing to tussle between the buyers and sellers, they said. They also said that some problems caused by rumour mongers, who created supply problems, which is causing also spike in the rates.
On Friday the US cotton rose the seven-cent limit for the second day in a row on protective short covering amid worries about the situation in Libya and the potential for further mishap in Japan this weekend, brokers said. With a 3.6 percent gain, the active May cotton contract on ICE Futures closed at $1.9912 per lb, extending the gain from Wednesday, when the market settled at a three-week low of $1.8512.
Still, for the week, the market is down 2.84 percent. Open interest, an indicator of investment exposure in cotton, stood at 172,925 lots as of March 17, a level that is still near the lowest since late July 2010, data from ICE Futures US showed.
Volume traded was estimated at 17,000 lots, the lowest level since February 28 and almost 50 percent below the 30-day norm, Thomson Reuters preliminary data showed. The following deals were reported : some 400 bales of cotton from Ali Pur sold at Rs 12500, 200 bales from Jalal Pur at the same rate, 400 beles from Fort Abbas at Rs 12600, 200 bales from Karoor Pakka at Rs 12000 and same figure from Rajan Pur at the same rate, equal number from Shujabad at the same rate and same number from Silian Wali at Rs 11800.
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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 18.03.2011
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37.324 Kgs 12,500 120 12,620 12,620 NIL
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Equivalent
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40 Kgs 13,396 120 13,516 13,516 NIL
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