Official spot rate drifted lower on the cotton market on Saturday due to higher cotton production and partly because of fears about decline exports, dealers said. The Karachi Cotton Association (KCA) official spot rate was lowered by Rs 200 to Rs 5,900, they said.
Prices of seedcotton in Sindh were down by Rs 200-100 at Rs 2000-2500 and rates in Punjab also followed same pattern, losing Rs 100 to Rs 2300-2600, they said. In ready dealings over 22,000 bales of cotton changed hands between Rs 4500-6,100, they added. Commenting on the present situation in the market, some analysts said that in the ready business, large volume of business is indicating that the ginners and mills have a ground to meet at the point to finalise the deals.
Limit-fall in the New York cotton market was a leading factor behind the rates decline, they said. It is interesting to note that how exports will perform in the competitive world because now-and-then the cotton prices are falling due to shortened demand the world over So, under the circumstances, the question emerges that how the mills or exporters would be able to export textile products, they said. The noticeable thing is Punjab type was retaining its firmness but now some ginners are in panic are selling at the lower prices to save themselves from futures losses, they said.
They also said that healthier trend in the phutti arrivals may create lethargic mood among the ginners On Friday, the NY cotton futures finished higher on investor buying as the market stabilised after falling to a 14-month low the previous session, analysts said.
The key December cotton contract on ICE Futures US rose 0.24 cent to close at 97.10 cents per lb, dealing from 96.47 to 98.80 cents. The market is down 4.7 percent for the week. On Thursday, the contract fell by almost 3 percent to end at 96.86 cents in the lowest settlement for the spot contract since September 2010.
Total volume traded on Thursday on the cotton market reached 22,529 lots, against the prior tally of 15,343 lots, ICE futures US data showed. It was also the first time in almost four weeks that the market broke a trading band that had confined December in a range from 98 cents to $1.04. Total volume traded on Friday was more than 12,800 lots, some five percent under the 30-day norm, preliminary Thomson Reuters data showed.
The following deals were reported: 1000 bales of cotton from Khipro sold at Rs 4500, 600 bales from Tando Adam at Rs 4500-5200, 2000 bales from Khair Pur at Rs 5200-5800, 2000 bales from Upper Sindh at Rs 5700/5800, 400 bales from Gojra at Rs 5650, 200 bales from Kassowal at Rs 5650, 200 bales from Mamo Kanjan at Rs 5650, 400 bales from Bahawal Nagar at Rs 650, 600 bales from Haroonabad at Rs 5675/5700, 1000 bales from Liaquat Pur at Rs 5700, 200 bales from Chistian at Rs 5700, 1000 bales from Ahmed Pur at Rs 5800/5900, 200 bales from Mohammad Pur at Rs 5900, 2000 bales from Rajan Pur at Rs 5900/6000, 2200 bales from Rahim yar Khan at Rs 5900, 1000 bales from Sadiqabad at Rs 5900, 1000 bales from Bahawal Pur at Rs 5900, 2000 bales from Burewala at Rs 5900/6100, 600 bales from Layyah at Rs 5950, 400 bales from Sillanwali at Rs 6000, 1000 bales from Khanewal at Rs 6000 and 400 bales from Mian Wali at Rs 6000.
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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 21.10.2011
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37.324 Kgs 5,900 130 6,030 6,230 - 200
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Equivalent
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40 Kgs 6,323 130 6,453 6,667 - 214
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