Firmness prevailed on the cotton market on Thursday as the ginners did not lower the asking prices of fine quality, brokers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 8,500, they said. In Sindh and Punjab phutty price of low type was at Rs 2500 and that of superior type at Rs 3000, they said.
In ready business, above 1,500 bales of cotton changed hands between Rs 7,600-8,700, they added. Market sources said that the ginners have small number of unsold bales and they may not sell them at lover rates, most of the stock is of best quality. The mills were accepting offers despite the higher rates, they said.
The NY cotton futures are on upward following the drought news and less rains in the cotton belt, this factor is causing stable trend in the local market, they said. According to a report, cotton acreage in India, the world's second biggest producer, may rise by up to 15 percent in 2011/12 as record high prices in the current season may induce farmers to expand acreage, industry officials, traders and farmers said.
Most farmers in the country usually start cultivation of the natural fibre crop in June, while harvesting begins from October. "Prices have softened a bit in the past two months, but still we expect cotton acreage to go up in the range of 10-15 percent in the coming season," said Dhiren N Seth, President, Cotton Association of India.
Cotton prices in India touched a record high of 61,700 rupees per candy of 356 per kilogramme (kg) on March 30, boosted by a rally in the world market. Key New York May cotton futures hit an all-time high of $2.197 per lb on March 7 after adverse weather created a supply squeeze in the global market.
On Wednesday, the US Cotton finished with steep gains for a second day in a row, as two fronts of bad crop weather jeopardised the new planting season, leading participants to bet on a diminished crop in the United States. Cotton's new-crop, December, ended up 5.59 cents, or 4.44 percent, at $1.3135 per lb on ICE Futures US. Earlier, it reached a high last seen on April 26, a day after the contract posted its biggest gain since March 31, when it rose nearly six percent.
ICE's benchmark July cotton futures also settled with strong gains of 2.15 cents at $1.5603 per lb, a 1.40 percent rise. Trading volume in the December contract stood at around 8,418 lots, not far behind July's 9,052 lots. Overall volume on ICE cotton for Tuesday came to 20,112 lots and was above the 30-day average, after falling 70 percent below the norm on Monday, Thomson Reuters' data showed.
The following deals were reported: 200 bales of cotton from Dunia Pur sold at Rs 8600, 200 bales from Hasil Pur at Rs 8500, 103 bales of cotton from Ahmed Pur at Rs 8700, 336 bales from Chichawatni at Rs 7600, 200 bales of cotton from Mongi Bangla sold at Rs 8000, 200 bales from Sadiqabad at Rs 8500 and more 200 bales from Khan Pur at Rs 8500, they added.
===========================================================================
The KCA Official Spot Rate for Local Dealings in Pak Rupees
---------------------------------------------------------------------------
FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"
---------------------------------------------------------------------------
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
===========================================================================
Rate Ex-Gin Upcountry Spot Rate Spot Rate Difference
For Price Ex-Karachi Ex. KHI. As Ex-Karachi
on 25.05.2011
===========================================================================
37.324 Kgs 8,500 120 8,620 8,620 NIL
---------------------------------------------------------------------------
Equivalent
---------------------------------------------------------------------------
40 Kgs 9,109 120 9,229 9,229 NIL
===========================================================================
Comments
Comments are closed.