Cotton prices hit new high; phutti arrival starts

Cotton prices hit the new high at Rs 4200 on Tuesday as arrival of best quality of seed cotton was on rise, dealers said on the cotton market. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 3800, dealers said.
As phutti arrival starts, the prices in Punjab were at Rs 2000-2200 and in Sindh the seed cotton was trading at Rs 1800-1850. Nearly 200 bales of cotton from Pakpattan sold at the record high price at Rs 4200, they said
Cotton production may be less this year as farmers or growers were interested to grow the crop, that is more profitable for them such as rice, some analysts said. This year, most of the commodity items tended higher especially, rice as many exporting countries banned the commodity to meet the shortage or control the prices locally, they said. But some of them have lifted the ban over the exports or thinking to grow more rice in their countries. Similarly, in Pakistan, cotton growers after facing shortage of irrigation water, are mulling to cultivate rice instead of cotton for better profit, they said.
It appeared that cotton business is on the losing side due to higher cost of production and partly because of textile products have failed in fetching the desired foreign exchange due to contamination problem and some other, as well. On Monday, NY cotton futures finished lower on investor sales and in line with weaker soybean values in Chicago, dealers said.
The key December cotton contract fell 0.71 cent to end at 79.40 cents per lb, dealing from 78.80 to 80.12 cents. Spot July cotton lost 0.79 cent to close at 70.88 cents, trading from 70.50 to 71.79 cents.
Volume traded in the December contract stood at 7,483 lots at 2:44 pm EDT (1844 GMT) while July volume amounted to 2,689 lots. Following deals were reported as some 400bales of cotton from Sultanabad sold at Rs 3700 and 4500 bales from Khanpur at Rs 3850, they said.

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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"

MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL

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Rate           Ex-Gin     Upcountry    Spot Rate Ex-Karachi

for            Price                        Sales Tax @ 15%

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37.32 Kgs      3800.00       50                     3850.00

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Equivalent

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40 Kgs         4072.00       50                     4122.00

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