Prices held present firmness on the cotton market on Saturday following the short supply of fine variety of cotton, dealers said. The official spot rate was unchanged at Rs 5,450, dealers said. In Sindh, prices of seed cotton were at Rs 2000 and Rs 3000 and in the Punjab, rates were at Rs 2200 and Rs 3100, they said. In the ready business, over 6000 bales of cotton changed hands between Rs 4600 and Rs 5700, they said.
Market sources said that leading participants eagerly waiting for the Pakistan Cotton Ginners Association (PCGA) fortnightly data, expected next week. We could not find any visible change during the session as some needy mills and spinners were in the market to replenish their stock, they said. Cotton analyst, Naseem Usman said that to compete the international market, the exporters want to increase their demands by the foreign countries, particularly by the European Union (EU).
Other analysts observed that exports to the European Union rose 22 percent in 2014 due Generalised System of Preferences Plus (GSP) plus status granted by the EU, they said. Besides, a huge inventory of cotton held by China is not allowing prices to go up in the local market, but damage of cotton crop in Punjab, helping rates to keep present levels, they added.
Reuters adds: Cotton futures fell on Friday on pressure from sharp gains in the US dollar, a lack of clarity over China's potential plans to reduce its massive cotton stockpile, and data showing a drop in US export sales. March cotton on ICE Futures US settled down 0.23 cent, or 0.37 percent, at 61.13 cents per lb. It traded within a range of 60.76 and 61.89. US export sales totalled 128,300 bales last week, down 34 percent from the prior week, according to US government data released Friday morning.
The March contract fell 2.1 percent this week and 3.5 percent for January. Total futures market volume rose by 5,660 to 35,757 lots. Data showed total open interest gained 1,130 to 195,709 contracts in the previous session. The following deals reported: 800 bales from Shahdadpur at Rs 4600-4725, 400 bales from New Saeedabad at Rs 5250, 1200 bales from Pir Mehal at Rs 5000, 1000 bales from Bahawalpur at Rs 5375-5400, same figure from Sadiqabad at Rs 5600-5700 and 2000 bales from Haroonabad at Rs 5650-5700, they said.
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The KCA Official Spot Rate for Local Dealings in Pakistan 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 29-01-2016
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37.324 kg 5,450 135 5,585 5,585 NIL
Equivalent
40 kgs 5,841 145 5,986 5,986 NIL
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