Business activity improved slightly on the cotton market Saturday following the emergence of fresh buying interest by millers and spinners, dealers said. The official spot rate resisted further decline, retaining the overnight level at Rs 6,300, they said. In the ready business, activity showed further improvement, as around 4,000 bales of cotton traded between Rs 4,650-6,500, dealers said.
In expectations of rise in demand by buyers in local and international market, millers indulged in fresh purchasing, cotton analyst Naseem Usman said. But on the other hand, cotton traders fear that in the absence of proper supply of gas and electricity, how they can meet orders on time? He added. According to Reuters, ICE Cotton futures edged up Friday in light trading volume, supported by outside commodities and financial markets and scaled-down mill buying, dealers said.
The most-active July cotton contract on ICE Futures US edged up 0.38 cent, or 0.4 percent, to settle at 86.41 cents per pound. The spot-contract was little changed from last week's close. The Thomson Reuters-Jefferies CRB Index, a benchmark for global commodities, posted gains. Besides, cotton prices in India are expected to be steady-to-lower next week due to sluggish demand from millers, tepid exports and sales from government reserves.
Buying by local millers has declined in the spot market due to the poor quality of supplies, traders said. Daily cotton supplies have been around 60,000 bales. The Cotton Corp of India (CCI) would conduct auctions on Monday, Tuesday and Wednesday of every week with around 20,000-25,000 bales to be offered in a single sale. It is likely to release 250,000 bales in the domestic market.
The following deals were reported: 400 bales of cotton from Sanghar at Rs 5,800, 200 bales of cotton from Nooriabad at Rs 6,000, same figure from Rasoolabad at the same rate, 400 bales from Chicha Watni (low type) at Rs 4,650, 266 bales from Multan at Rs 6,300, 200 bales from Yazman Mandi at Rs 6,000, same number from Vehari at the same rate, same figure from Sahiwal at Rs 6,375 and 800 bales from Sadiqabad at Rs 6,200-6,500, 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 17.05.2013
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37.324 Kgs 6,300 155 6,455 6,155 NIL
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Equivalent
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40 Kgs 6,752 155 6,907 6,907 NIL
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