Trading remains at low level due to high prices, tax issues (now settled); normalcy may return next week

Trading in cotton stayed restrained, as the rate did not fluctuate with the trend prevailing globally during the week ended on April 2, 2011. The spot rate was at Rs 12500 and the phutti rate was Rs 4000-5000.
WORLD SCENARIO:
Cotton futures have sustained dip in very slow pace. The most weekdays surge was usual but at the tail end. Despite general belief that cotton stocks and production will keep demand steady, unless fresh developments in North Africa and Middle East worsens and oil supplies receive set back. Australia has been reporting good on the front with exception of a negligible setback caused by floods and draught like situation, Uzbekistan had better than previous season crop. Only China and Pakistan will have to see to countries with cotton surplus.
America has already exhausted stocks to honour immediately on call. China has multiple sources such as South African countries and CIS. Pakistan has been lucky to get replacement of Indian indifference - India blatantly turned face with over one million bales remained in the pipeline. Uzbekistan terms will go a long way in consoling Pakistan, as offer is being made at terms this country would not have dreamt.
The quality of the lint, too is known to be comparable to any country's. Brazil patently soya and corn producing has plans to set aside acreage for sowing lint. Cotton growers in this country won't have required investment under disposal. They are handicapped and would share machinery and thus reap cotton and healthy return. India second largest cotton producer and exporter is in queue raising acreage by 15pc.
On Monday the US cotton futures closed the daily limit down due to light investor sales, as players began positioning themselves before release of a key government plantings report this week. The key May cotton contract on ICE Futures US dropped the seven-cents limit to end at $1.9749 per lb, with the session top at $2.04. Total volume was around 15,000 lots, almost 50 percent below the 30-day norm, Thomson Reuters preliminary data showed.
On Tuesday US cotton futures ended lower on investor sales, as the market dropped for the third straight session, with most players waiting for release of a key government plantings report this week. The key May cotton contract on ICE Futures US fell 2.61 cents to end at $1.9488 per lb, dealing from $1.941 to $2.01. Total volume traded in the cotton market was around 14,200 lots, almost 50 percent below the 30-day norm, Thomson Reuters preliminary data showed.
On Wednesday the US cotton futures ended slightly higher on investor buying, as players braced for next day's release of a keenly awaited government plantings report, analysts said. The US Agriculture Department will release its annual potential plantings data on Thursday at 8:30 am EDT (1230 GMT). The USDA report is the first government survey of likely plantings for major row crops in 2011. The key May cotton contract on ICE Futures US fell 1.21 cents to conclude at $1.9367 per lb, dealing from $1.9223 to $1.9993. Total volume traded in the cotton market was around 24,600 lots, about five percent below the 30-day norm, Thomson Reuters preliminary data showed.
On Thursday the US cotton futures ended the first quarter up 38.3 percent as the market, the best performing commodity of 2010, extended its historic rally fuelled by tight supplies and strong mill demand. The key May cotton contract was up the seven-cent limit on Thursday to end at $2.0023 per lb, against the end-2010 close in the market at $1.4481.
On Friday the US cotton futures closed lower on investor profit-taking as players opted to take cash home after fiber contracts surged in the previous session due to a bullish government plantings report. The key May cotton contract on ICE Futures US fell 4.68 cents, or 2.3 percent, to finish at $1.9555 per lb, dealing from $1.9506 to $2.0100. On the week, cotton is down 4.4 percent. The new-crop December cotton contract slipped 0.32 cent to end at $1.3218. Total volume traded in the cotton market was around 23,800 lots, about 3 percent below the 30-day norm, Thomson Reuters preliminary data showed. Volume traded on Thursday reached a six-week high of 41,765 lots, ICE Futures US data showed.
DOMESTIC MARKET:
The opening day saw low pace in trading owing to prices, which stay firm. The spot rate was unchanged at Rs 12,200. Low type phutti in Sindh and Punjab ruled at Rs 4000, while superior ruled unchanged at Rs 5000. The market sources expressed the hope that trading will improve following restoration of zero rating, while lower rate of GST was expected. Indian growers are likely to improve sowing over more acreage by 17 percent.
On Tuesday spot rate was raised by Rs 300 to Rs 12,500 in low trading activity, phutti rates were unchanged. In ready take off 800 bales of cotton were lifted, prices ranging between Rs 12500 and Rs 13000. Australia seems oblivious of fact that world rates are fluctuating. Unless reasonable rate of cotton is available in local markets so that textile products made place in foreign markets. The zero rate restoration will certainly help enhancement in exports.
On Wednesday cotton market depicted holiday mood due to Indo-Pak cricket match. The market was officially open but the cricket match - between Pakistan and India was always too sticky and people stay watching match rather than to attend to business. Spot rate was unchanged, so that of seed cotton. In ready some 1400 bales of cotton changed hands, showing some business was witnessed.
On Thursday firm trend was evident as leading participants were said to be conspicuous by their absence.
The buyers were looking for pace to lift cotton to their hearts' content, spot rate was steady at Rs 12,500, phutti prices in Sindh and Punjab were marked doing around Rs 4000 and Rs 5000, respectively. The buyers showed their disinterest in local prices, which were running against international rate keeping low. In the meantime China's desire to increase stockpile was certain to boost the sentiment.
On Friday Dullness persisted on the cotton market as leading mills and spinners were still double minded before striking any deal. Karachi Cotton Association (KCA) official spot rate was steady at Rs 12,500. In Sindh and Punjab phutti price of low type was at Rs 4000 and superior type also unchanged at Rs 5000. In ready business not a single deal finalised, as ginners were not ready to lower the asking prices.
On Saturday some activity was seen as needy mills came to meet the urgent needs after the settlement on the tax issues. Official spot rate was steady at Rs 12,500. In Sindh and Punjab, phutti price of low type was at Rs 4000 and superior type also unchanged at Rs 5000. In ready business nearly 1800 bales of cotton changed hands at Rs 13000.
CALL FOR NEW VARIETIES OF COTTON:
The cotton leaf curl virus (CLCV) and white fly have been deadly threats to cotton crop is often expressed with concern, but is never taken up as seriously as the threat demanded. The research institutes and centres do exist though in not large numbers. But they are manned by exports and senior people with hope that they would exercise experiments to get crops particularly of cotton crop rid of deadly diseases.
The two threats quoted above have been left on the mercy of God. Somehow the dangers to crop reached the president who promptly advised cotton committee to take up seriously specially in the Punjab to work on varieties that resist those diseases. In Punjab, as a whole cotton considered of acceptable quality, if CLCV and white fly curse are effectively arrested may be lame pretext to import quality cotton melt away. If cure of the two is not found, new varieties of cotton should be introduced. Apart from pay and perks, the meeting decided that research institution coming up with new varieties would be given a major share in the marketing rights with a view to promote research in agriculture.
The report indicating the above first published about a month back but those scientists and experts have been addressed with lucrative offer have kept silence. It is hoped some new varieties are found so that cotton is saved from pest and viral attacks.
GROW MORE COTTON RUMBLE THROUGH PRESIDENT'S HOUSE:
Thank God, the president had time to bother about growing more cotton who in a couple of years wished 15 million bales to minimise imports as far as possible.
The cotton consumers have always been noisy about growing cotton more and more, a lot do rot in the process though. Those who take care of their interest should keep in view other interest dear to and above all country's. The cotton growers have never failed to grow as much cotton as the consumers need. It often, however, happens that the consumers buy as much they need, the rest, what they call quality cotton import as a result growers fail to sell out their stock and in disgust often burn cotton. In the past press clubs in interior have seen flames rising out of the cotton that was ignored. The authorities should have in mind interest of different players.
Besides shortage of cotton, yarn users are always voicing either for shortage of yarn or high cost of yarn. Someday back good news about sharp jump in textile exports was afloat. Unless authorities are about cotton needs and its availability, similarly they must be on guard unscrupulous owes are kept on safe distance to harm individual or national interest. For one or the other reason spinners exploit all opening to export unmindful of the fact that local made export will suffer.
COTTON FROM NEW SOURCE AND AT EASY TERMS AVAILED:
Such pleasant music is not always as sweet as one million ton cotton will be finally arranged in order in warehouses, which was either destroyed by floods in August or similar quality deal was thrown down the drains by a neighbour. The two traditional cotton suppliers to Pakistan, annually without a break, were "bereaved" as incapacitated by had weather or hurriedly sold out owing to high returns.
However, recent very frequent and close contacts with Uzbekistan, with about half a dozen accord could strike cotton deal for supply of cotton about one million bales at very agreeable terms. Since India had cautioned Pakistan about possible neglect in supply, Pakistan consumers were nearly in utter "shock". They must have been pretty relieved also on failure of supplies from India, because hopes to have orders in hand from the "EU" states had dried up passage from "WTO" was negated.
A constituent of CIS, separated from Union of Soviet Socialist Republic (USSR), has been minute by minute coming closure to Pakistan, quite naturally because Pakistan still has leaning toward countries which have dear their interest to heart. Uzbekistan could have not only supplies to Pakistan cotton, good quality cotton, but would have imported made ups from this country. Pakistan thus suffered two way losses. Uzbekistan was offering cotton to China. Was Pakistan aware of this fact. Now as the approach has been made and excellent supply condition has been made possible for this country. The lint is expected by June 30, 2011 and time is suited to Pak cotton consumers.
DEEP SILENCE OVER EU'S LOUD CLAMOUR:
Thus for only twice EU offer for duty waiver submitted to formally give a positive nod has been quietly shelved. The authorities who are always busy with rendering some service for the good of the exports, economy and country have been found indifferent to the loss which definitely prove to be unbearable. About exporters who had invested their money and labour are under shock cannot be questioned. The EU had presented the likely gift to this country in December 2010 for assent for varieties of textile exports to have begun early January 2011 was held back for a country had opposed tooth and nail along with suggestion that would set a bad precedent.
However, honest feeling it was, a fickle economy like Pakistan was at the edge of, God for bid, going door to door. Sources have always held that none on this earth can push nations to roam about with begging bowl unless nations are bereft of an independent living. Even on Monday, there was nothing to indicate the textile made-up sector was mourning second consecutive reminder of nations with firm foot in the comity of nations. The cure being discussed was nowhere in the region of affording comfort, but could have given opportunity to exporters to keep engaged in useful pursuit. Breakdown has not been announced in clear terms. It is hoped and prayed the facility has been granted as the EU had adjudged best.