Prices fell on the cotton market on Saturday as the ginners lower asking prices, which caused rising demand by mills, dealers said. Official spot rate maintained overnight level at Rs 5,850, they said. In the ready business, over, 26,000 bales of cotton changed hands between Rs 5550-6000, they said. Prices of seed cotton (phutti) in Sindh were down by Rs 50 to Rs 2500-2700, while, rates maintained overnight levels in the Punjab at Rs 2600-2850, they said.
Commenting on the bearish trend in the market, cotton analyst Naseem Usman said that lack of buying interest among mills propelled ginners to cut down prices. This factor lifted daily-intake and hopefully, prices may fluctuate in a narrow in the coming days, other brokers said. Trading activity may improve as European Union (EU) waiver on customs duties for 75 items (mostly textiles) from Pakistan with effective from 1st November to 31st December 2013 has opened tremendous opportunities for Pakistan to increase its exports to 27 EU member countries.
According to the Reuters, US cotton futures hit fresh July lows on Thursday as index funds rolled long front-month positions forward and investors sold ahead of the US government crop report, expected to highlight continued weak demand and rising supplies. "The Goldman Sachs roll kicked in hard today," said Ron Lawson, a trader with brokerage logicadvisors.com in Sonoma, California.
The most-active December cotton contract on ICE Futures US settled 0.81 percent lower at 69.26 cents per lb. For a second session, it was its lowest settlement since end-July.
Volumes were heavy as index rolls made up a significant portion of activity. Almost 25,000 lots of December contracts changed hands, which was double average levels. On Friday, the US cotton futures closed higher, as a solid domestic Chinese price helped cushion the blow of another bearish monthly crop report, but the bounce still left the market down 1 percent on the week.
The US government raised its 2012/13 forecast for global cotton inventory to above 80 million 480-pound bales for the first time due to larger-than-expected output in the United States, the world's third largest producer, and falling demand from China, the world's largest consumer.
While analysts and traders expected the increase, surpassing the 80 million mark reinforced concerns about rising supplies and long-term demand as mills use more man-made fibers. The most-active December cotton contract on ICE Futures US settled 0.81 percent higher at 69.26 cents per lb but ended the week down more than 1 percent.
Following deals report: 1600 bales from Shahdadpur at Rs 5650/5700, 1400 bales from Tando Adam at Rs 5550/5700, 1200 bales from Sanghar at Rs 5650/5800, 2000 bales from Mir Pur Khas at Rs 555/580, 2000 bales from Khairpur at Rs 5900, 1000 bales from Upper Sindh at Rs 5900, 200 bales from Bahawalpur at Rs 5700/5800, 1600 bales from Hasilpur at Rs 5800/6000, 400 bales from Faqirwali at Rs 5800/5875, 800 bales from Pak Pattan at Rs 5815, 1400 bales from Fort Abbas at Rs 5825/5875, 400 bales from Khiciwala at Rs 5825, 800 bales from Shujabad at Rs 5875, 1200 bales from Mianwali at Rs 5865-6000, 400 bales from Haroonabad at Rs 5850, 200 bales from Chistian at Rs 5850, 200 bales from Vehari at Rs 5850, 200 bales from Kabbirwala at Rs 5925, 4000 bales from Rahim Yar Khan at Rs 5950-6000, 400 bales from Bakhar at Rs 5950, 1000 bales from Dera Ghazi Khan at Rs 6000, 800 bales from Rajanpur at Rs 6000, 800 bales from Shah Jewana on (Credit) at Rs 6000 and 800 bales from Fazilpur at Rs 6000, 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"
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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 08.11.2012
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37.324 Kgs 5,850 155 6,005 6,005 NIL
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Equivalent
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40 Kgs 6,269 155 6,424 6,424 NIL
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