Hectic trading was seen on the cotton market on Tuesday as mills and exporters showed fresh interest in buying to meet the future demand, dealers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 6,200, they said. In the ready business more than 12000 bales of cotton changed hands between Rs 6000-6600 in process of trading, they added.
Market sources said that the exporters and mills were active to cover the short-term needs as prices were matching with their psychological level. In the meantime, it is expected that the prices may not fluctuate sharply as ginners' strike is continuing and it looks that the government may help in resolving the problem in the near future, they said.
The ginners refused to buy phutti from growers, seeking waiver of withholding tax, because these taxes are extra burden on them, ginners requested the Prime Minister to reduce or wave the tax, cotton analysts said. Rains are continue in Punjab and good are for the cotton crop, they said. It is expected that the country may get the target of above 15 million bales of cotton this year and its is also likely that it may not face cotton shortage problem, they said. According to a report, India's cotton output is set for a second successive record harvest in 2011/12, up about 10 percent over last year's 32.5 million bales, a Reuters poll showed, signalling higher supplies from the world's number two producer amid sliding global prices.
A survey of eight traders pegged the average output for the season starting in October at 35.7 million bales, on higher acreage and subject to well-distributed rains. On Monday the US cotton futures closed sharply lower on investor sales as the selling spree sparked by the US credit downgrade pulled fiber contracts down and will likely depress values this week, analysts said.
World stocks sank to the lowest level in nearly a year by Standard & Poor's downgrade of the US, with gold soaring to record ground above $1,700 an ounce. The key December cotton futures on ICE Futures US dropped 3.86 cents or by 3.8 percent to finish at 97.72 cents per lb, dealing from 97.58 cents to $1.015. Total volume traded stood over 14,000 lots, less than half a percent above the 30-day norm, Thomson Reuters preliminary data showed.
The following deals were reported: 800 bales of cotton from Hyderabad sold at Rs 6100-6200, 1200 bales of cotton from Sanghar at Rs 6100-6200, 400 bales of cotton from Tando Adam at Rs 6150-6200, 1000 bales of cotton from Shahdad Pur at Rs 6150-6200, 200 bales of cotton from Nooriabad at Rs 6200, 200 bales of cotton from Kotri at Rs 6200, 800 bales of cotton from Khipro at Rs 6100-6200, 400 bales of cotton from Mian Chunnu at Rs 6400-6500, 400 bales of cotton from Haroonabad at Rs 6400, 200 bales of cotton from Kasoowal at Rs 6400, 1000 bales of cotton from Burewala at Rs 6400-6500, 200 bales of cotton from Kabirwala at Rs 6450, 400 bales of cotton from Hasil Pur at Rs 6500, 1000 bales of cotton from Vehari at Rs 6500, 200 bales of cotton from Multan at Rs 6500, 200 bales of cotton from Chichawatni at Rs 6500, 200 bales of cotton from Tiba Sultan Pur at Rs 6500, 200 bales of cotton from Mamo Kanjan at Rs 6500, 200 bales of cotton from Sillan Wali at Rs 6500, 200 bales of cotton from Bahawal Pur at Rs 6550, 200 bales of cotton from Tandlianwala at Rs 6600, 2200 bales of cotton from Khanewal at Rs 6600.
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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 08.08.2011
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37.324 Kgs 6,200 120 6,330 6,330 NIL
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Equivalent
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40 Kgs 6,645 120 6,775 6,775 NIL
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