Prices were firm on the cotton market on Thursday as mills showed little interest in the fresh buying, dealers said. The official spot rate was unchanged at Rs 3,400. In the meantime, some 1,200 bales changed hands at Rs 3,300; they said. Market sources said that no change was seen in the present scenario on the cotton market as the spinners bought some hundred lots to meet the near-term needs.
But most of them were keen to do more purchase after further decline in the prices, they said adding that the ginners were worried over the continued fall in the rates. According to the news report in the forthcoming trade policy the government is to provide nearly Rs 40 billion incentives to the value-added textile sector, hopefully, this factor may help the textile sector to come out of the present crisis.
In the meantime, it seems very difficult to say any thing about the future direction of the market but one factor is evident that trading activity may not improve in a big way in the near future, they said.
Additionally, reports reaching the market that experts are suggesting the cotton growers to take precautionary measures to save the standing crop from the white fly or farm diseases, brokers said. In fact, it is necessary for the growers to take steps to prevent the spread of cotton leaf curl virus (CLCV), they added.
On Wednesday, the NY cotton futures settled at another seven-week low on follow-through technical sales and the market is looking for signs that a bottom will soon be reached in fiber contracts, brokers said. The July cotton contract fell 0.40 cent to finish at 52.03 cents per lb, dealing from 52 to 52.80 cents.
Wednesday's close was the lowest finish for cotton on a spot basis since late April. Volume traded in the July contract was at 7,564 lots at 2:39 pm EDT (1839 GMT). The new-crop December cotton contract shed 0.14 cent to settle at 57.60 cents, moving from 57.39 to 58.04 cents. The following deals were reported as some 600 bales of cotton from Shahdadpur at Rs 3300, 300 bales from Mirpur Mathelo at the same rate and 200 bales of cotton from Vehari at the same rate, 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"
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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37.324 Kgs 3,400.00 100 3,500.00
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Equivalent
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40 Kgs 3,644.00 100 3,744.00
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