Listless business on cotton market

LAHORE: The local cotton market on Friday remained bearish while the trading volume remained low.

The Spot Rate remained unchanged. Cotton Analyst Nasseem Usman while talking to Business Recorder said that the price of Punjab’s Phutti attracted per 40 kilograms prices from Rs 7000 to Rs 9000.

Cotton of Sindh was traded from Rs 18000 to Rs 20,000 per maund, Punjab’s cotton was traded from Rs 18000 to Rs 20,000 per maund. He also told that 400 bales of Fort Abbas were sold at Rs 19200 per maund and 400 bales of Pano Aqil were sold at Rs 21500 per maund. While 400 bales of Dherki were sold at Rs 2100 per maund, he added.

Usman said that due to the war between Russia and Ukraine the prices of cotton witnessed a decline both locally and internationally.

ICE Cotton slips over 1% hit by Russia – Ukraine crisis, dollar jump

ICE cotton futures slipped more than 1% on Thursday weighed by a risk-off sentiment across equities after Russian forces invaded Ukraine and a stronger dollar.

The most active May cotton contract on ICE futures was down 2.20 cents, or 1.8%, at 119.10 cents per lb, at 12:05 ET. Prices had touched 125.13 cents earlier in the session, the highest level in three weeks.

“The ramifications from all that’s going on over in Europe are really what’s kind of driving the good and bad here today... If Ukraine moves the stock market, it’s going to help move the cotton one way or another,” said Jack Scoville, vice president at Chicago-based Price Futures Group.

“Currently the dollar’s up sharply, that’s weighing on sentiment for cotton,” Scoville added.

Russian forces invaded Ukraine in a mass assault by land, sea and air, the biggest attack by one state against another in Europe since World War Two.

Global stocks tumbled, while oil prices rose above $105 a barrel for the first time since 2014 after Russia strikes at Ukraine.

The dollar index rose 1.50% and was on pace for its biggest daily percentage gain since March 2020. A stronger greenback makes cotton more expensive for holders of other currencies.

Investors are also awaiting the U.S. Department of Agriculture’s (USDA) weekly export sales report due on Friday, delayed by a day due to a holiday on Monday.

Last week, the report showed net sales of 158,500 running bales for 2021/2022.

Total futures market volume rose by 9,591 to 25,998 lots. Data showed total open interest gained 1,517 to 238,226 contracts in the previous session.

The Spot Rate remained unchanged at Rs 20,000 per maund. Polyester Fibre was available at Rs 268 per kg.

Copyright Business Recorder, 2022