Rate of cotton reached at highest level in history of Pakistan

KARACHI: The local market on Friday remained bullish and trading volume remained satisfactory.

As a result of bullish trend in the cotton market on Friday after noon the rate of cotton in Sindh reached at Rs 13,600 per maund and the rate of cotton in Punjab reached at Rs 13,900 to Rs 14100 per maund. The rate of cotton reached at the highest level in the history of Pakistan.

Cotton Analyst Naseem Usman told Business Recorder the rate of cotton in Sindh is in between Rs 13,450 to Rs 13,550 per maund. The rate of cotton in Punjab is in between Rs 13,700 to Rs 13,800 per maund.

The rate of the new crop of Phutti in Sindh was in between Rs 5,500 to Rs 6,000 per 40 Kg. The rate of Phutti in Punjab is in between Rs 5,500 to Rs 6,200 per 40 Kg. The rate of Banola in Sindh is in between Rs 1,750 to Rs 1,850 per maund. The rate of Banola in Punjab is in between Rs 1,700 to Rs 1,850 per maund. The rate of cotton in Balochistan is Rs 13,450 to Rs 13,500 per maund. The rate of Phutti in Balochistan is Rs 5,900- 6,300 per maund.

1,600 bales of Tando Adam were sold at Rs 13,450 to Rs 13,550 per maund, 2,800 bales of Shahdad Pur were sold in between Rs 13,400 to Rs 13,500 per maund, 1800 bales of Sanghar were sold at Rs 13,400 to Rs 13,500 per maund, 1,200 bales of Nawab Shah were sold at Rs 13,500 per maund, 1,400 bales of Mir Pur Khas were sold in between Rs 13,400 to Rs 13,500 per maund, 600 bales of Kotri were sold in between Rs 13,400 to Rs 13,450 per maund, 600 bales of Khadro, 400 bales of Jam Sahib were at Rs 13,500 per maund, 600 bales of Hyderabad were sold at Rs 13,450 per maund, 100 bales of Dolat Pur were sold at Rs 13,400 per maund, 600 bales of Askari were sold at Rs 13,500 per maund, 400 bales of Haroonabad, 400 bales of Chichawatni, 400 bales of Min Chanu were sold at Rs 13,800 per maund, 200 bales of Dera Ghazi Khan were sold at Rs 13,750 per maund, 200 bales of Dera Ghazi Khan were sold at Rs 13,750 per maund, 200 bales of Dunya Pur were sold at Rs 13,650 per maund, 400 bales of Gojra were sold at Rs 13,675 per maund, 200 bales of Murid Wala were sold at Rs 13,750 per maund and 1,200 bales of Vehari were sold at Rs 13,700 to Rs 13,800 per maund.

The cotton market was sharply higher Thursday as traders were not expecting USDA’s reduction in its August crop update. Last month’s cotton crop was pegged at 17.80 million bales, while expectations for day’s report centred on 18.38 million bales. The actual number was 17.26 million, a 540,000-bale cut.

One bearish nuance was the reduction in exports, however, overall, domestic ending stocks fell 300,000 to 3.0 million bales. As a side note, the report was essentially friendly for corn and beans.

Friday the CFTC will issue its weekly commitment of traders report. At last count, managed-money funds were nets long some 67,000 contracts. We are sure Thursday’s bullish action had that group buying more contracts.

A new poll says a majority of businesses (66%) indicate they can survive under current COVID-19 restrictions for more than a year. The survey comes as several cities and states are contemplating full-scale shutdowns or curfews.

To date, more than two-thirds of adults in the U.S. have received at least one dose of a COVID-19 vaccine, and those who have been fully vaccinated are largely protected from the worst effects of the virus. According to the CDC, COVID-19 now poses a much greater a risk to those who haven’t yet received a shot.

Due to the quarantine requirements of ships, all ships in China will be delayed for 14-21 days, depending on their previous ports of call. This is a new regulation implemented by China. Vessels are not allowed to enter the port unless the quarantine period is over. This also led to ships waiting in the port and further congestion.

In this month’s 2021/22 U.S. cotton projections, beginning stocks are slightly larger, and a 536,000-bale decrease in production results in lower exports and ending stocks. Beginning stocks are larger as estimated exports for 2020/21 are reduced 50,000 bales based on final Export Sales data and Census Bureau data through June. NASS’s first survey-based estimate of production for 2021/22 is 17.3 million bales. Exports are 200,000 bales lower than in July, and ending stocks are 300,000 bales lower, equating to 17 percent of expected use, the same as in 2020/21. The U.S. season-average price for upland cotton is forecast 5 cents per pound higher than in July which, at 80 cents, would be its highest since 2011/12.

Lower production is reducing this month’s 2021/22 global ending stocks forecast slightly. World production is forecast 546,000 bales lower as reduced production in Brazil, the United States, and Uzbekistan offsets higher projections for Australia, Mali, and Tanzania. Consumption is forecast slightly higher, up 170,000 bales, with gains for Bangladesh and Pakistan. World 2021/22 cotton ending stocks are projected at 87.2 million bales, about 500,000 bales lower than in July, and 4.6 million lower than in 2020/21.

A Covid outbreak that has partially shut one of the world’s busiest container ports is heightening concerns that the rapid spread of the delta variant will lead to a repeat of last year’s shipping nightmares.

The Port of Los Angeles, which saw its volumes dip because of a June Covid outbreak at the Yantian port in China, is bracing for another potential decline because of the latest shutdown at the Ningbo-Zhoushan port in China, a spokesman said. Anton Posner, chief executive officer of supply-chain management company Mercury Resources, said that many companies chartering ships are already adding Covid contract clauses as insurance so they won’t have to pay for stranded ships.

It seemed as if things were just starting to calm down, “and we’re now into delta delays,” Emmanouil Xidias, partner at Ifchor North America LLC, said in a phone interview. “You’re going to have a secondary hit.”

The shutdown at Ningbo-Zhoushan is raising fears that ports around the world will soon face the same kind of outbreaks and Covid restrictions that slowed the flows of everything from perishable food to electronics last year as the pandemic took hold. Infections are threatening to spread at docks just as the world’s shipping system is already struggling to handle unprecedented demand with economies reopening and manufacturing picking up.

Ningbo-Zhoushan Port said in a statement late Thursday that all other terminals aside from Meishan have been operating normally. The port is actively negotiating with shipping companies, directing them to other terminals, and releasing information on a real-time data platform, it said.

To minimize the impact, it’s also adjusting the operating time of other terminals to make sure clients can clear their shipments. A spokesman for the port said there were no further updates when contacted Friday.

The Spot Rate remained unchanged and closed it at Rs 13,500 per maund. The Polyester Fiber was available at Rs 222 per Kg.

Copyright Business Recorder, 2021