Brisk activity was seen on the cotton market on Friday as a result of renewed buying by the exporters and mills, dealers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 7000, they said. In the ready business, approximately 25,000 bales of cotton changed hands between Rs 6950-7200, they said.
Seed cotton prices in Sindh were higher by Rs 50 to Rs 3200-3250, in Punjab prices also picked up Rs 100-50 at Rs 3000-3150, they added. Commenting on the present trend in the market, some viewers said that prices firmed as ginners raised asking prices to earn better profits. Despite the higher trend in the market, the mills and exporters were active to cover the long position, they said.
In the meantime, cotton growers were hoping that the government would help them by releasing irrigation water to the standing crop, so the country can attain at least one million additional bales of cotton during the current month, they said.
Furthermore, Pakistan Cotton Forum (PCF), which is joint platform of growers, ginners and spinners demanded concession to the textile industry to increase the exports and also not bring them under the umbrella of value-added tax (VAT). They also observed that imposition of VAT may waste all concessions offered by the European Union (EU).
An industry body said on Thursday that Australia's cotton output is set to nearly double in 2010/11 as farmers respond to prices hovering near 15-year highs and ample rains by increasing acreage under the crop. Production could reach 3.5 million bales (4.4 bales equals one tonne), nearly double the 1.8 million bales produced in 2009/10, according to Cotton Australia, the industry body that promotes the commodity in the country. On Thursday the NY cotton futures closed sharply higher on speculative and trade buying as players braced for release of a key government crop report, brokers said.
ICE Futures US benchmark December cotton contract went up the 4.00-cent limit to finish at $1.0375 per lb, the highest close for the second position cotton contract in a week. The session low was at 99.64 cents. Back contracts posted gains from 0.83 cent to 2.03 cents. Total volume traded hit 30,642 lots at 2:53 pm EDT (1853 GMT), about two-thirds above the 30-day average at 18,305 lots, preliminary Thomson Reuters data showed.
The following deals were reported: 2000 bales of cotton from Shahdadpur sold at Rs 7050-7100, 3000 bales from Mirpurkhas at Rs 7075-7100, 2000 bales from Sanghar at Rs 7050-7100, 1200 bales from Tando Adam at Rs 7100-7150, 1000 bales from Hyderabad at Rs 7075-7100, 2500 bales from Nawabshah at Rs 7100, 3500 bales from Khairpur at Rs 7100-7200, 1600 bales from Upper Sindh at Rs 7150-7200, 600 bales from Chichawatni at Rs 7075, 200 bales from Bahawal Nagar at Rs 6950, 2000 bales from Burewala at Rs 7100, 1000 bales from Khanewal at Rs 7100, 600 bales from Chistian at Rs 6950, 400 bales from Gange Raja at Rs 7000, 400 bales from Muridwala at Rs 7100, 1000 bales from Sahiwal at Rs 7050-7100, 400 bales from Rahim Yar Khan at Rs 7100 and 600 bales from Kabirwala at Rs 7100.
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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 07.10.2010
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37.324 Kgs 7,000 120 7,120 7,170 NIL
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Equivalent
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40 Kgs 7,502 120 7,622 7,622 NIL
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