Activity came down on the cotton market on Saturday in process of trading, dealers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 6,200, they said. In Sindh see cotton prices were unchanged at Rs 2700-2750 and in Punjab rates were at Rs 2900-2950, they said.
In the ready business, over 7000 bales of cotton changed hands between Rs 6100-6500 in process of trading, they said. Commenting on the present trend in the market, Naseem Usman said that trading activity was down due to higher prices and partly because of ginners' strike against 3.5 withholding tax for purchasing of phutti from the third party. He also said that the ginners are demanding of the government to remove the tax, which under the circumstances, is an adding problem for the ginners.
Besides, he said that the world economy, which is already under pressure, now it may face more crisis as the United States has lost its top-notch AAA credit rating from Standard & Poor's on Friday in an unprecedented reversal of fortune for the world's largest economy.
According to the news, the S&P cut the long-term US credit rating by one notch to AA-plus on concerns about the government's budget deficits and rising debt burden. The move is likely to raise borrowing costs eventually for the American government, companies and consumers.
On Friday the US cotton futures were sharply lower on investor sales sparked by the weak global macro economic environment, but the ability to hold technical support meant fibre contracts should grind higher into next week, analysts said. The key December cotton futures on ICE Futures US dropped 3.34 cents or by 3.2 percent to finish at $1.0158 per lb, dealing from $1.0112 to $1.0541. The market traded below the 20-day moving average set at $1.0248. On the week, the market was off a fractional 0.19 percent. Total volume traded stood at 14,000 lots, around 2.6 percent below the 30-day norm, Thomson Reuters preliminary data showed.
The following deals were reported: 1000 bales of cotton from Shahdad Pur sold at Rs 6100-6300, 1000 bales of cotton from Tando Adam sold at Rs 6100-6200, 1000 bales of cotton from Sanghar at Rs 6100-6300, 200 bales from Shah Pur Chakar at Rs 6300, 600 bales from Hyderabad at Rs 6100-6350, 400 bales from Sillan Wali at Rs 6500, 200 bales from Dunia Pur at Rs 6500, 600 bales from Chichawatni at Rs 6500, 200 bales from Vehari at Rs 6500, 400 bales from Burewala at Rs 6500, 200 bales from Kassowal at Rs 6500, 400 bales from Bahawal Nagar at Rs 6500, 400 bales from Sahiwal at Rs 6500 and 400 bales from Hasil Pur at Rs 6500.
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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"
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MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
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Rate Ex-Gin Upcountry Spot Rate Spot Rate Difference
For Price Ex-Karachi Ex. KHI. As Ex-Karachi
on 05.08.2011
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37.324 Kgs 6,200 120 6,330 6,330 NIL
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Equivalent
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40 Kgs 6,645 120 6,775 6,775 NIL
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