Business volume picking up on cotton market as rates remain range bound
Trading activity showed betterment on the cotton market on Friday so the prices managed to maintain firmness but it may prove short-lived due to fall in foreign demand, dealers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 5,300, they said.
Prices of seedcotton in Sindh were unchanged at Rs 1800-2300 and in Punjab rates were at Rs 2000-2500, they said. In ready dealings over 23,000 bales of cotton changed hands at Rs 3,800-5,400, they added. Some brokers said that the ginners were showing nervousness over the unforeseen outlook of future trend in the prices as they have invested to gain profits but it looks it may not come true.
According to market circles mills and spinners are still worried about the falling demand and prices of cotton, the world over. The local market is under pressure and it will remain so in the absence of proper demand by the foreign consumers, they added. On the other hand, the ginners are also uncertain following the statement by the Pakistan Cotton Ginners Association (PCGA), in which it announced that Association would suspend Phutti procurement from December 10, 20011, brokers said.
According to a report on the website of the China National Cotton Reserves Corp (www.cncotton.com), the prices for imported cotton in China are likely to extend their current decline on weak Christmas demand. Besides, it was also expected that the buying activity will come down by consumers as the report showing that Christmas orders had declined heavily this year and some cotton mills had suspended production earlier than in previous years.
Reuters add: On Thursday the US cotton futures settled slightly easier on thin investor sales as players eyed an EU summit on Friday to tackle the bloc's debt crisis and awaited release of a government crop report tomorrow, analysts said. Cotton was pressured by weak financial markets as investors were dismayed by the European Central Bank's lukewarm support for aggressive action to resolve the crisis.
Key March cotton futures slipped 0.26 cent to end at 92.05 cents per lb, moving from 91.66 to 92.99 cents. On Wednesday the trading band stood at 91.75 to 93.80 cents. Volume traded on Thursday stood at around 6,600 lots, over two-thirds under the 30-day average, according to ICE Futures data.
The following deals were reported: 400 bales of cotton from Mir Pur Khas sold at Rs 3800/3850, 2000 bales of cotton from Khair Pur at Rs 4600/4700, 1000 bales of cotton from Upper Sindh at Rs 5175/5200, 1000 bales of cotton from Haroonabad at Rs 5000/5025, 1200 bales of cotton from Hasil pur at Rs 5050, 200 bales of cotton from Faqirwali at Rs 5050, 400 bales of cotton from Samandari at Rs 5050, 200 bales of cotton from Gojra at Rs 5050, 400 bales of cotton from Sahiwal at Rs 5100, 400 bales of cotton from Bahawal Nagar at Rs 5100, 1200 bales of cotton from Chichawatni at Rs 5100/5200, 200 bales of cotton from Qabola at Rs 5150, 400 bales of cotton from Burewala at Rs 5150, 200 bales of cotton from Multan at Rs 5150, 800 bales of cotton from Vehari at Rs 5150/5200, 1200 bales of cotton from Fort Abbas at Rs 5150, 400 bales of cotton from Bahawal Pur 5200, 200 bales of cotton from Dunia Pur 5200, 1000 bales of cotton from Lodhran at Rs 5200/5300, 200 bales of cotton from Yazman Mandi at Rs 5200, 2500 bales of cotton from Khanewal at Rs 5200/5300, 600 bales of cotton from Liaquat Pur at Rs 5250, 400 bales of cotton from Khan Pur 5300, 200 bales of cotton from Kot Addu at Rs 5300, 200 bales of cotton from Kabbir Wala at Rs 5300, 400 bales of cotton from Sadiqabad at Rs 5300, 1000 bales of cotton from Rahim Yar Khan at Rs 5300, 600 bales of cotton from Layyah at Rs 5300, 400 bales of cotton from Jalal Pur 5300, 1000 bales of cotton from Shujabad at Rs 5300, 800 bales of cotton from Dera Ghazi Khan at Rs 5300/5325, 1400 bales of cotton from Mian Wali at Rs 5350/5400 and 400 bales of cotton from Fazil Pur at Rs 5400.
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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 08.12.2011
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37.324 Kgs 5,300 130 5,430 5,430 NIL
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Equivalent
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40 Kgs 5,680 130 5,810 5,810 NIL
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