The firmer trend kept buyers sidelined bound waiting for happy change in prices or availability of strictly quality lint preferred by the importers. Prices stayed thus range bound. The spot opened at Rs 2725 and same rate was seen until close of the week.
WORLD SENARIO:
Sharp downturn was evident on market opening after long holidays. Switch trade evoked some life into trade setting futures to fluctuate either way.
The futures on Monday-May down 1.10 to 51.81 cents while July was down 1.00 cent to 53.55 cents a pound. The futures closed near 8-week low on being hammered by speculative liquidation, as players expected more similar situation. It was looking technically had picture, they said. They expressed burden some level of stocks was weighing heavily on fibre contracts. Cotton prices are hovering in a band.
Easier trend continued on Tuesday, players did not take note of lowered US exports in 2006-07 to just 13.5 million and cut in Chinese cotton imports. Analyst put focus on the market and will increasingly turn to growing and weather condition in particularly US cotton belt.
The third session turned futures looking upside owing to modest gains as switch trade was main feature. The players explained switching is a process where investors begin moving position out of spot month.
On Thursday rising tempo dipped to four-month low. As usual the switch trade and speculative sales caused the slide. The switch trade was expected to tell on the value of the futures. If anything will bring about visible change, it was spring growing conditions over next few weeks. Weekly export sales had nothing to do with the trading. Meanwhile weekly exports were registered at 327,500 RBs, substantially lower than previous week. The shipment reached 286,900 RBs, also lower then last weeks.
On Friday futures ended with mostly losses. There was trade buying too, but it had no effect as most leading player were moving out of May contract deliveries. The activity has no strength as all interested are in the plantings and following crop position. May contract was down 0.28 to 51.40 cents a pound.
LOCAL TRADING:
The ruling high prices depressed buying to a great extent. Both the sellers and buyers knew this day was ahead but the buyers were dilly-dallying expecting that better arrival would make prices favourable. But seemingly sellers had the day though quantity came on ground with a thud. Spot rate stayed at Rs 2725 while asking cotton prices touched the high of Rs 2800 per mound.
The Monday or opening session failed to see any outlet because prices were not attractive. However, how long will this sluggish state continue was wondered. Some immediate requirements remain there and buyers return is a matter of a day or two. Since sellers don't have stock of unmanageable size, they are not in a hurry to relax position.
On Tuesday prices remained main constraint in buying. Around 3000 bales of cotton changed hands between Rs 2735 and Rs 2800. The spinners and millers have accepted range bound prices upto Rs 2800. Once again talks of imports have been in the afloat, obviously to pressurise the sellers. The world rate is also on the higher side. But the buyers also are not panicky, cheaper cotton as alleged by the importers are in the pipeline.
On Wednesday only slight improvement in lifting cotton - at 4000 bales was seen, though at the season's highest. Change in prices was not there as sellers were happy with buyers coming to market under pressure.
The next day was drier as buyers were reluctant to bow as low the sellers would like. But they were also considering if package is released, stuck up with the govt may prompt return to market of the manufacturers and exporters. Market sources were surprised at the complete silence about imported cotton delivery. The daily announcement could help better to calculate their own cotton cost. However millers are light and are unlikely to come under pressure the sellers would like to.
On Friday pent up buying was marked as buyers concentrated on quality but buying around 8000 bales. The spot rate was put at Rs 2725 while rates in ready ranged between Rs 2640 and Rs 2800. The spinners resorted to buy cotton from growers directly but that did not affect price.
On Saturday situation was not much different. Some 1800 bales changed hands. prices ranging between Rs 2700 and Rs 2800. Spot rate remained static at Rs 2725.
TOO CAUSED CONFLICT:
The cotton yarn non-availability in the local market owing to un-bridled exports had some years back brought the value-added goods exporters and leading trade bodies closer to understanding. And now some common interest has again dragged them together. How long they will tolerate, or in other words, how long their interest will not be on odds? The shake hands some years back was very pleasing to all interested quarter.
It seemed all varied trade bodies will stick together to jointly safeguard their common interest at the epic venue FPCCI had reportedly opened with smiles but ended in utter confusion and probably deepened further. Fortunately, let us take this way, the WTO opened their eyes but it ultimately emerged that something blocked the opportunities rivals harvested but Pakistanis, both govt and exporters got entangled in the web of challenges. It would hear nice, probably, the Punjab which is on real prosperity path, announced it is determined to equip itself with likely shortfall due to ignorance.
This is flagrant realisation that exporters were to be held responsible and they should suffer. They should have got abreast with the vast opportunities. Instead the WTO with billions of dollar offer repeatedly fed by unnamed sponsors proved at the very advent a dreaded dream.
The traders and exporters with solid proof of doing business at high cost turned to govt putting all responsibilities on its shoulder and to bear the loss. It was here that traders and exporters stood firmly and made a platform to oppose govt move to set sprawling trade bodies on certain pattern. But not all have really stod against what is in discussion, TOO. To a great extent strong trade body KCCI has expressed surprise at the opposition on second thought as initially same bodies had supported when TOO (Ordinance 2006) was announced. According to M. Haroon Agar the basic purpose of the TOO is to eliminate bogus and fake chambers.
NOW BY END 2007:
Keeping alive hopes of some positive deal in WTO a cure for all ills, before year end appears convergence has been found, which is being kept by a few. The all cure WTO has missed celebration several times. But before it could be quietly buried some more optimistic soul infused new life.
Every time what was discovered the factor for making some developing country effective target snatching greater market access. There already are a couple of world organisations, which are not by any standard true to their name. Very lately two countries practically defaced had not strictly followed the democratic norms or majority vote.
The poor WTO is out to rescue the some dozens of sharp and shrewd philanthropists who gathered money for enough to keep in safety and security. Dozens of countries need today billions of dollars for agriculture and industrial development but risk factor blocks the sentiment. The way has been found to offer billions to so called developing countries but progress has been blocked effectively over margin of profit.
The developed countries, poked by some individual billionaires, have shown agreement to part with their calculated wealth but won't see dollar drained out for poor, who according to their calculation developing countries must allow more access to their market. The poor countries picked up leaders - Brazil and India were watching from distance more with apprehension than hope that developing countries would be delivered offered money. Taking so-called Doha Round, is ending its six years and all know Bush could sign it final version up to June 30, 2007.
The Democrats have declared they with power to do so won't like to patronise such deal or deals. Still there are people who are not tired of singing WTO success and with valid ground declare WTO will be a reality like League of Nations and the UNO. The American trade official has repeatedly expressed WTO is a reality but developing countries must come with more ground, And, some convergence seems to reached. Choice of a developing country is full of meaning.
REPEAT PERFORMANCE:
History is replete with repeat performances and waking people learn from mistakes. Not necessarily ones own but anyone. There are certain nations, who have been fair in communicating to those who come close to them that they are primarily fair to themselves. Thus making it clear that anybody who wants to be fair to themselves who can lead them to fall into pit holes? If Pak friends prefer to offer you charity which always has scope to fatten your bank balance, at the cost of govt kitty.
You, instead, want to prefer trade, investment to come or like things and friend's hand is light and he politely refuses to offer, but offers same facilities to your neighbour for one moment tarry and evaluate and try fathom factor or factors primarily your friend suffers weakness from.
It is history, when Pakistan was created quite naturally it needed friend, friends - friends in need. Pak neighbour also looked for a powerful country to help it also as powerful. Through the mirror of history any blind man can see the difference in two countries. Pakistan wanted dollars, not they, knowledgeable circles said so.
But history says resoundingly, Pak neighbour has knowledge and knows how, and whatever you call, can build from needle to railway engine, from 3-not-3 gun to best known fighter planes. While Pakistanis, for reasons known to them, today assemble tractors, trucks, buses, cars, TV and name anything that makes nations a competitive exporters to a good fighter.
Incidentally, the Russian PM was here the other day on a 3-day stay, long enough to learn vide variety of things if history is a real teacher. Despite bad condition are masters of all trade. If Pakistanis are not same old people, may be PM returns with a feeling that he had come to impart but Pakistanis took pride in taking PM round Expo-2007.
WHY CHOSEN INDIA?
If Bush fails to sign and puts his seal the WTO would renew its journey on similar uncertainty it faces today. Bush has not much time to do the wonders decidedly he did by attacking Iraq to be welcomed there to be known thereafter as the liberator. What would be WTO fate and certainly not as bad, if Republicans had conquered the two houses. But it is in the hands of Democrats who do not believe in such deals.
And it seem certain Democrats won't OK the WTO deal after giving more to the poor. Bush could have done this wonder by putting his seal on the WTO deal but that would have led to his fall. That, however, came. Today the leading nations trade ministers are gathering in New Delhi with fond hope of a deal after convincing Indian and Brazilian negotiators to allow rich more access to poor nations market and reap billions of dollar which will flow in or take away further from poor nations who survive or succeed in failing to pay due at the end of season.
How funny does it hear, said knowledgeable that trade chiefs hope to salvage Doha talk in a land which must be hoping to deliver a message that their products will be welcomed without high tariff in all the lucrative markets. But poor person or a nation is chosen to over power to snatch a deal. The African cotton growers have been least satisfied with the situation they are faced with the last they can do is to get rid of their traditional means of earning two square meals.
The design so far has come to light from rich countries responsible for this plight of WTO that deal of which could ensure happiness to those who have forgotten how to smile and sleep soundly with belly full of food. Any deal emerging from Indian meeting will give surprise if it is rich parted with which they were reluctant for the last few years.
TAIL PIECE:
April 14, 2007, or a date near to it NA standing committee on finance and revenue is likely to reach a definite end. The body took exception of clearance of brokers involved in the KSE biggest scam. The NA body rejected SECP chairman on face value. It decided to take to a convincing end. Chairman's justification that case was invalidated as dates were not available, besides authorities were not in favour of stretching probe to any limit. The body rightly censored the SECP decision as to why a case was instituted in fact the ousted SECP chairman had claimed all data was preserved that could speak the truth.
The knowledgeable circles reluctantly expressed how leaving probe in between the road, Pak economy has been rendered thin and sickly. The prosperity the authorities resounding talk about is not seen anywhere, they said. In another case, the other day, a Senator Enver Baig regretting a different case alleged SECP is now known a commission to protect white-collar criminals including stock mafia. Will NA body deliver the fact ever?
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