Steady price trend on cotton market despite ginners' keenness to sell
Just panic like selling by ginners was again seen on the cotton market on Thursday in process of trading, dealers said. The Karachi Cotton Association (KCA) official spot rate was retained at the overnight level at Rs 8,500, they said.
In Sindh prices of new crop phutti were higher at Rs 3650-3700 and old crop phutti in Sindh and Punjab the rates were: of low type at Rs 2500 and that of superior type at Rs 3000, they said. In ready business trading activity was good as nearly 6000 bales of cotton changed hands between Rs 7800-9000. The feature of the day that nearly 300 bales of cotton from the new crop were sold, they said.
According to the market sources the ginners were not hesitant in selling of old stuff due to arrival of new crop. The ginners are keen to dispose of all old stock as they are getting prices at their psychological levels. Other experts said that the cotton traders are confused over the issue of 3.5 percent tax by the government if they purchase from growers, they are not bound to pay tax but if they buy from others or third party, they have to pay tax on their buying.
On Wednesday the US cotton futures settled lower on investors liquidation as a commodity-wide sell-off spilled into the market, analysts said. Fundamentally, cotton is still looking at one of the worst droughts in a century damaging cotton crop in Texas, the top growing state in the country.
The key December cotton contract on ICE Futures US fell 5.98 cents to finish at $1.258 per lb, ranging from $1.3224 to down the six cent daily limit at $1.2578. The spot July contract dropped 3.58 cents to settle at $1.5196 per lb.
The following deals were reported: 100 bales of new crop from Burewala sold at Rs 8600, 200 bales from Shahdad Pur at Rs 8400 and from the old crop 247 bales from Mir Pur Mathelo at Rs 7850, 1300 bales from Bahawal Pur at Rs 9000, 150 bales from Uch Sharif at Rs 8650, 294 bales from Darran Wala at Rs 8000, 1265 bales from Rahim Yar Khan at Rs 8800, 1000 bales from Sadiqabad at Rs 8700, 400 bales from Mailsi at Rs 8600, 200 bales (mill to mill) at Rs 9000 and 1000 bales (mill to mill) 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 15.06.2011
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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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