Panic buying was seen on the cotton market on Wednesday as mills and exporters both were active to cover the forward buying, dealers said. The official spot rate was up by Rs 25 to Rs 3525 for the third day in a row. Phutti prices in Sindh also rose by Rs 50 to Rs 1725-1750 and in the Punjab, prices also gained the same amount to Rs 1750 and Rs 1800 due to quality facto, they said.
Volume of business was all-time high as above 56,000 bales of cotton changed hands between Rs 3450-3600, they said. Market sources said that the strong demand by the importing countries propelled mills and exporters to make huge forward buying. They also said that the quality factor was also a major reason behind the panic buying.
If the supply of good quality of cotton not improves in the Punjab, the prices may go up in the coming days, some analysts said. In the meantime the Trading Corporation of Pakistan (TCP) would to issue a tender of above 50,000 bales of cotton on 21 of this month to sell remaining stock with them, they said.
On Tuesday the NY cotton futures finished at a 13-month top on investor buying spurred by the weak dollar and the strong performance of outside markets, brokers said. The December cotton contract increased 1.20 cents to close at 65.88 cents per lb, dealing from 64.01 to 65.95 cents.
On a spot basis, it was the highest finish for cotton since early September 2008. December contract volume reached 12,836 lots at 2:45 pm EDT (1845 GMT). March cotton rose 1.15 cents to settle at 68.35 cents, ranging between 66.52 and 68.38 cents.
THE FOLLOWING DEALS WERE REPORTED: 5000 bales of cotton from Shahdadpur sold at Rs 3575-3600, 4800 bales from Tando Adam at Rs 3575-3600, 2000 bales from Mirpur Khas at Rs 3550-3575, 3000 bales from Sanghar at Rs 3575, 1200 bales from Nawabshah at Rs 3575, 3000 bales from Khair Pur at Rs 3600, 4000 bales from Upper Sindh at Rs 3600, 800 bales from Gajjgo at Rs 3600, 3000 bales from Ahmedpur East at Rs 3550, 3000 bales from Bahawal Pur at Rs 3550-3600, 1000 bales from Ali Pur at Rs 3575, 2000 bales from Burewala at Rs 3550-3575, 800 bales from Mongi Banglow at Rs 3550-3575, 6000 bales from Bahawal Nagar at Rs 3575-3600, 800 bales from Arifwala at Rs 3550-3600, 3000 bales from Rajan Pur at Rs 3600, 3000 bales from Fazil Pur at Rs 3600, 2000 bales from Dera Gazi Khan at Rs 3575-3600, 2000 bales from Ghazi Ghat at Rs 3575-3600, 1000 bales from Sahiwal at Rs 3550, 1000 bales from Mian Channu at Rs 3575, 600 bales from Gojra at Rs 3600, 1000 bales from Muridwala at Rs 3550-3575 and 2000 from Pak Pattan at Rs 3450-3500.
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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 3,525.00 100 3,625.00
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Equivalent
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40 Kgs 3,778.00 100 3,878.00
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