Prices were steady on the cotton market on Monday in process of modest trading, dealers said. Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 12,200, 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 over 3000 bales of cotton changed hands between Rs 11000-13000, they added. Market sources said that trading activity improved slightly due to restoration of zero-rating for the textile exporters and cut the rate of General Sales Tax (GST) to four to six percent on sales of textile goods in the local market from the earlier notified 17 percent.
They also said that trading activity may pick up in the coming days. But it is most likely that the ginners may not sell their unsold stock below their psychological level due to short stock. According to a report, India's farmers could boost cotton acreage by 15 percent in the 2011/12 season, a trade body said on Monday, raising the possibility that domestic prices could ease from June from current near-record highs.
The Cotton Association of India (CAI) said its estimates of increased acreage for the crop were based on expectations higher earnings will prompt farmers to plant the fibre in more areas. Cotton prices in India touched a record high of 60,200 rupees per candy of 356 per kilogramme (kg) on March 22 mainly in line with global gains for the crop. Key New York May cotton futures touched an all-time high of $2.195 per lb on March 7 on supply concerns.
===========================================================================
The KCA Official Spot Rate for Local Dealings in Pak Rupees
---------------------------------------------------------------------------
FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"
---------------------------------------------------------------------------
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
===========================================================================
Rate Ex-Gin Upcountry Spot Rate Spot Rate Difference
For Price Ex-Karachi Ex. KHI. As Ex-Karachi
on 26.03.2011
===========================================================================
37.324 Kgs 12,200 120 12,320 12,320 NIL
---------------------------------------------------------------------------
Equivalent
---------------------------------------------------------------------------
40 Kgs 13,075 120 13,195 13,195 NIL
===========================================================================