First-ever price peak seen in cotton business history

The first-ever peak was seen in the history of cotton business as supply was tight during the strong demand by the mills, dealers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 3,900, they said. In the ready business, phutti prices gained Rs 25 to Rs 2050-2100 in Punjab and in Sindh prices were down by Rs 25 to Rs 1975-2000, they added.
Approximately, prices of 200 bales from Pakpattan touched the historical level at Rs 4300 due to heightened demand by the spinners. According to the market sources, cotton prices hit the new high due to short supply position and following the fear of rise in shortage in the near future. It is expected that short supply position may cause further rise in the cotton rates, they said.
In the meantime, the Pakistan Cotton Ginners Association (PCGA) is going on strike from Wednesday against the imposition of different taxes and charges over the electricity and gas. Under the prevailing situation, the ginners and growers were trying to hold back the stuff for better return after the fresh sharp rise, they said.
On Monday, the NY cotton futures settled lower on light investor sales and the market may drift while waiting for news to provide direction to fiber contracts this week, brokers said. The key December cotton contract slipped 0.65 cent to close at 73.85 cents per lb, near the bottom of its 73.75 to 74.80 cents band.
The following deals were reported : some 200 bales of cotton from Sanghar sold at Rs 4150, 300 bales from Shadadpur at Rs 4100-4150, 600 bales from Hyderabad at Rs 4100-4200, 200 bales from Renalakhurd at 4190, 200 bales from Haroonabad at Rs 4200, 400 bales from Pir Mahal at Rs 4200, 200 bales from Arifwala 4200, 200 bales from Chichawatni at Rs 4125, 200 bales from Bhawalpur at Rs 4150, 400 bales from Pakpattan at Rs 4150, 200 bales from Hasilpur at Rs 4150, 400 bales from Chichawatni at Rs 4250 exporter to Mill for Karachi delivery, 100 bales from Sahiwal at Rs 4250, exporter to Mill for Karachi delivery, 100 bales from Burewala at Rs 4250 Exporter to Mill for Karachi deliver and 200 bales from Pakpattan at Rs 4300 exporter to mill for Karachi delivery, dealers 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     3,900.00        50                   3,950.00

Equivalent-------------------------------------------------

40 Kgs        4,180.00        50                   4,230.00

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