Price fall continues despite mills' fresh buying on cotton market
Mills active buying was seen on the cotton market on Friday as falling trend in the prices attracted them and exporters were also in market but in few numbers, dealers said. The Karachi Cotton Association (KCA) official spot rate slashing was extended, lowered by Rs 100 to Rs 5,000, they said.
Prices of seed-cotton in Sindh were unchanged at Rs 1500-2200 and in the Punjab prices followed the same pattern, retaining overnight levels at Rs 1600-2300, they said. In ready dealings approximately 28,000 bales of cotton changed hands at Rs 3,125-5,000, they added.
One factor, which was very clear is panic selling by the ginners, who have already bought of the season, and now they are worried due to sharp fall in the prices, some experts said. To stabilise prices, the ginners asked the government to urge the Trading Corporation of Pakistan (TCP) to buy cotton, otherwise they will suffer further losses, they said.
Besides, the exporters were in the market but in little numbers because higher dollar rates are causing some relief for them, they added. A time, when cotton was in demand by consumer countries, hitting all-time high rate at Rs 1400 due to short supply but now when the supply is on the higher side, the buyers are not inclined to purchase even at the lower rates, they said.
Reuters adds: On Thursday the NY cotton futures finished with moderate gains, but prices could soon resume their downside trek, with little fundamental or technical news to keep them bolstered. On Wednesday, cotton dipped to a 16-month low, it's third in as many days. Though the selling was staunched on Thursday, and prices could continue to rise for a few days, they will likely unravel again, analysts said.
Benchmark March cotton futures closed 1.17 cents higher, up 1.37 percent, at 86.29 cents per lb. The contract set an inside day, trading at a lower high of 86.71 and a higher low at 85.0 cents. Generally, after an inside day whichever direction prices head next dictates their near-term outlook. Volume traded in the March futures came to 6,610 lots.
The following deals were reported: 400 bales from Mir Pur Khas sold at Rs 3125, 200 bales of cotton from Tando Adam at Rs 3150, 600 bales of cotton from Sultanabad at Rs 3200, 1000 bales of cotton from Nawabshah at Rs 3900, 400 bales of cotton from Shahdad Pur at Rs 4100, 1000 bales of cotton from Khair Pur at Rs 4250/4400, 1000 bales of cotton from Upper Sindh at Rs 4800, 400 bales of cotton from Khuzdar at Rs 5000, 600 bales of cotton from Yazman Mandi 4500, 2000 bales of cotton from Haroonabad at Rs 4500/4650, 400 bales of cotton from Chistian at Rs 4550, 1000 bales of cotton from Hasil Pur at Rs 4600/4800, 1000 bales of cotton from Faqir Wali at Rs 4500/4600, 1000 bales of cotton from Ahmed Pur at Rs 4600/4800, 2000 bales of cotton from Fort Abbas at Rs 4650/4700, 1000 bales of cotton from Bahawal Pur at Rs 4700/4800, 400 bales of cotton from Shujabad at Rs 4700, 600 bales of cotton from Burewala at Rs 4700, 1200 bales of cotton from Chichawatni at Rs 4700/4800, 400 bales of cotton from Mian Channu at Rs 4700, 400 bales of cotton from lodhran at Rs 4700, 2000 bales of cotton from Noor Pur at Rs 4800, 2000 bales of cottonn from Khanewal at Rs 4600/4900, 2000 bales of cotton from Rahim Yar Khan at Rs 4900, 1200 bales of cotton from Sadiqabad at Rs 4900, 1200 bales of cotton from Mian Wali at Rs 4900, 1000 bales of cotton from Kabirwala at Rs 4900, 400 bales of cotton from Tonsa Sharif at Rs 5000, 400 bales of cotton from Rajan Pur at Rs 5000.
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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 15.12.2011
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37.324 Kgs 5,000 130 5,130 5,230 -100
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Equivalent
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40 Kgs 5,358 130 5,488 5,596 -108
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