As dollar's surge halted, most of the leading mills refrained from routine business on the cotton market on Friday, dealers said. Official spot rate was unchanged at Rs 6000, they said. In ready business, nearly 9,000 bales of cotton finalised between Rs 5900 and Rs 6100, they said.
Prices of cottonseed (phutti) were down at Rs 2400-2650 and in Punjab rate of low type was lower by Rs 50 to Rs 2450 and the best type lost Rs 100 to Rs 2750, they said. Some brokers said that most of the leading mills and spinners were on the sidelines as hopes are fading for better margin of profit because dollar rate is coming down versus the rupee.
In addition, it is expected that the prices of cotton likely to show softness as the ginners may lower the asking prices because if they don't sell below the physical level, they have face short of finance ahead of bank closing and Christmas holiday, cotton analyst Naseem Usman said. Cotton eased again on Thursday on a wave of heavy selling across the commodity markets as investors fretted about the US budget crisis, with losses limited by continued speculative interest.
"Sideways trading would not normally be significant except that cotton was actually one of the best performers in the broader commodity complex," said INTL FCStone analysts. The most-active March cotton contract on ICE Futures US settled down 0.06 cent, or 0.07 percent, at 75.83 cents per lb, having recovered some lost ground shortly before the close. Prices languished in negative territory all day, but moved off an intraday low of 75.05 cents after finding support at its 10-day moving average.
"The firm support below 75.25 cents and the push higher at settlement demonstrate continued speculative interest in buying cotton, especially on the pullbacks," the broker's analysts said. The following deals were reported: 200 bales of cotton from Shahdadpur at Rs 5400, 100 bales from Sanghar at Rs 5400, 200 bales from Mirpurkhas at Rs 5400, 400 bales from Vehari at Rs 5900, 200 bales from Hasilpur at Rs 5900, 200 bales from Pul Bagar at Rs 5900, 200 bales from Kehror Pakka at Rs 5900, 400 bales from Alipur at Rs 5900, 1200 bales from Shujabad at Rs 5900, 600 bales from Bahawalpur at Rs 5900/5950, 400 bales from Layyah at Rs 6000, 400 bales from DipalPur at Rs 6000, 400 bales from Liaquatpur at Rs 6000, 800 bales from Jalalpur at Rs 6000, 400 bales from Tonsa Sharif at Rs 6000, 800 bales from Khanewal at Rs 6000/6100 and 2200 bales from Rahimyar Khan at Rs 6050, they 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"
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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 20.12.2012
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37.324 Kgs 6,000 155 6,155 6,155 NIL
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Equivalent
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40 Kgs 6,430 155 6,585 6,585 NIL
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