Trading activity improved modestly on the cotton market on Wednesday ahead of the Pakistan Cotton Ginners Association (PCGA) fortnightly report, dealers said. The official spot rate resisted further erosion, holding overnight rate at Rs 5,200, dealers said. In Sindh, seed cotton prices were at Rs 1500-2700, and in Punjab prices stayed put at Rs 1700 and Rs 2900, they said.
In the ready business, around 4000 bales of cotton changed hands between Rs 4550 and Rs 5550, they said.
According to the market sources, some needy spinners came back to cover the immediate requirements. Cotton analyst, Naseem Usman said decline in cotton rates globally and poor demand from local spinning industry kept market under pressure these days.
Other analysts said that record low in NY cotton futures and reports that China, which is holding record 30 to 40 million bales, is now disposing them of in the international market, adding worries for the traders.
Besides, they said that there are deepening economic crisis the world over as China is planning to lay-off million of coal workers, locally a large number of mills closed down in Faisalabad, increasing number of jobless rate.
Adds Reuters: Cotton futures fell in muted trading on Tuesday as prices hovered near the prior session's 6-1/2 year low.
On Monday, cotton futures pared losses after falling to the lowest since June 2009 due to worries over demand in China, which had sparked selling early in the session.
Prices were consolidating after the prior day's volatile trade, said Peter Egli, director of risk management at British merchant Plexus Cotton, adding that the cotton market was oversold.
The May contract on ICE Futures US settled down 0.39 cent, or 0.69 percent, at 56.11 cents per lb, after hitting a low of 56.05 cents.
The following deals reported: 1000 bales from Qutubpur at Rs 4550-5100, 815 bales from Dunyapur at Rs 5100, 400 bales from Haroonabad at Rs 5250, 400 bales from Rahim Yar Khan sold at Rs 5300, 200 bales from Mianwali at Rs 5400 and 400 bales from Rajanpur at Rs 5550, dealers 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 01-03-2016
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37.324 kg 5,200 135 5,335 5,335 NIL
Equivalent
40 kgs 5,573 145 5,718 5,718 NIL
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