Bullish sentiment prevailed on the cotton market on Wednesday as prices tended higher due to tight supplies, dealers said. The Karachi Cotton Association (KCA) spot rate was raised by Rs 75 to Rs 4,450, dealers said. In the ready business prices also showed some Rs 100 rise as nearly 4000 bales changed hands between Rs 4400-460.
Phutti prices in Sindh and the Punjab were at Rs 2000-2300, they added. Some analysts said that the market is moving on the demand and supply factor. In India cotton prices went up and in the United States short position pushed the rates higher and China is also facing short supplies, they said.
Prices in local market followed the same track as reports indicated that phutti arrivals may show declining trend in the coming days, they added. Higher trend in the prices, kept the buyers on the sidelines as ginners raised the asking rates on rising perception of short supply, they guessed.
According to the reports the tight cotton supply in China, the world's largest consumer, after the government sold all of a planned release of its reserves, drove local futures to a record high on Tuesday. Besides, news that China's 2009-10 cotton crop would fall over 11 percent to 6.7 million tonnes, about 29 to 30 million (480-lb) bales, in the 2009/10 season.
On Tuesday the NY cotton futures closed easier on thin investor profit-taking as players appeared to be bracing for the New Year break, brokers said. The key March cotton contract fell 0.75 cent to close at 75.07 cents per lb, trading from 75 to 76.18 cents. Volume traded in the March contract hit 3,528 lots at 2:40 pm EST (1940 GMT).
THE FOLLOWING DEALS WERE REPORTED: 400 bales of cotton from Shahdadpur sold at Rs 4450, 400 bales from Shah Pur Chaker at Rs 4400, 400 bales from Khair Pur at Rs 4425, 800 bales from upper Sindh at Rs 4600, 600 bales from Dera Gazi Khan at Rs 4550, 400 bales from Muhammad Pur Divan at Rs 4550, 400 bales from Fazil Pur at Rs 4550, 200 bales from Taunsa Sharif at Rs 4550 and 233 bales from Rahim Yar Khan at Rs 4500, dealers 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 4,450.00 100 4,550.00
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Equivalent
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40 Kgs 4,769.00 100 4,869.00
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