Activity picks up on cotton market, further price rise feared

Cotton prices might depict further rise due to short supplies and sharp rise in the imported cotton rates, dealers said at the cotton market on Thursday.
In line with the market trend, the Karachi Cotton Association (KCA) official spot rate was up by Rs 50 to Rs 2650, without upcountry expenses. In the ready business deals struck between Rs 2600 and Rs 2800, they said.
Under the circumstances cotton analysts were expecting pries to touch the new high at Rs 3000. Appreciation of the Indian rupee is making imports of cotton from the neighbouring country expensive. The next direction of the market is entirely depending on the demand and supply factor, analysts said.
Signals from the New York cotton market were positive as the New York Board of Trade's May cotton contract added 0.21 cent to close at 53.26 cents per lb, dealing from 52.95 to 53.50 cents. July rose 0.30 to 54.74 cents. Three contracts aside, the rest went up 0.30 to 0.42 cent.
The Intercontinental Exchange's NYBOT electronic market for cotton showed the May contract up 0.25 cent to 53.30 cents at 2:32 pm EDT (1832 GMT), moving from 52.95 to 53.50 cents. After crossing the season's peak level at Rs 2800 at Rahim Yar Khan, analysts observed trading activity picked up as mills were active to cover their needs, they said.
THE FOLLOWING DEALS WERE REPORTED: 200 bales of cotton from Nawabshah sold at Rs 2700, same figure from Hyderabad at the same rate, 400 bales from Rohri at Rs 2600, 2600 bales of cotton from Rahim Yar Khan at Rs 2750, 1200 bales from Shujabad at Rs 2750, 400 bales from Karoorpacca at Rs 2700 and 200 bales from Lodhran at the same rate.

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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      2650.00        50                    2700.00

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

40 Kgs         2840.00        50                    2890.00

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