Firmness prevailed on the cotton market on Monday as there was cautious buying in the absence of fresh leads, dealers said. The Karachi Cotton Association (KCA) official spot rate retained the last week level at Rs 8,500, they said. In Sindh and Punjab phutty price of low type was at Rs 2500 and that of superior type at Rs 3000, they said.
In ready business, nearly 1000 bales changed hands between Rs 8500-9000, they added. Market sources said that there were some hesitations among the ginners as they were keen to get maximum rate of the fine type. On the other hand, the mills and spinners were hoping that the ginners, who have very little unsold stock may lower the asking prices ahead of beginning of new cotton season. The mills are hoping for improvement in the textile sector as announcements in the budget for the textile sector is not in a big way but better than the last year's budget package, some analysts said.
In the meantime some of them said that one percent cut in the sales tax on many by-products of cotton and it looks there is no immediate relief. One thing is clear that there was nothing on the issue of tax on the farm income despite speculations and that was a great relief, they said. The current season is near to its end and the impact of the fiscal steps for the textile sector in the general way will appear in the starting of the new season from September.
Some brokers said that the prices may not move sharply and it will be clear after the new phutti arrivals, the days are not far away, they said. The following deals were reported: 300 bales of cotton from Saleh Pat soldat Rs 8600, 400 bales from Mongi Bangla at Rs 7900, 200 bales from Rahim Yar Khan at Rs 8500 and same figure from Khanewal at Rs 9000.
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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 04.06.2011
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37.324 Kgs 8,500 120 8,620 8,620 NIL
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Equivalent
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40 Kgs 9,109 120 9,229 9,229 NIL
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