Strong mills' demand pushed rates higher on the cotton market on Wednesday in the process of trading, dealers said. The official spot rate was higher by Rs 50 t0 Rs 6,050, they added. The prices of seed cotton in Sindh were at Rs 3300-3325 and in Punjab rates were at Rs 3100 and Rs 3200, they said. In the ready session, about 5000 bales of cotton changed hands between Rs 6100-6200, they said.
Some analysts said that mills were active in fresh buying of cotton ahead of Eid-ul-fitr holidays, they are trying to cover their needs as much as they can. Spinning mills were expecting that load shedding of power and gas may be reduced after Eid, as it looks that during the month of Ramazan, the government is providing power and gas facilities to the common citizens, instead of mills and industries, experts said.
Business activity in cotton producing countries, slowed down due to world recession, such as China reduced import from India and Pakistan, as well. Reports showing that China imported 218,600 tonnes of cotton in the month of June, down 19.1 percent on the year, but up 13.9 percent compared with the previous month, an industry association said on Tuesday, citing official customs data.
The China Cotton Association (CCA) said the average price of the imports stood at $2,132 per tonne, down $5 compared with the previous month. Imports of cotton were affected by China's decision to auction off its state reserves. Cotton analyst, Naseem Usman said that the present rates are matching with the exporters' psychological levels, availing change by finalising deals.
Reuters adds: ICE cotton slipped again on Tuesday, resuming the market's biggest rout in years as speculators resumed selling fiber amid concerns about growing oversupply and offsetting pockets of buying as mills chased bargains. The benchmark December cotton contract on ICE Futures US settled down 0.55 cent, or 0.8 percent, at 67.75 cents a lb. Volumes were lower than recent sessions.
The following deals were reported: 1200 bales from Sanghar at Rs 6125-6150, 600 bales from Tando Adam at Rs 6125-6150, 400 bales from Mir Pur Khas at Rs 6150, 200 bales of cotton from Golarchi at Rs 6150, 200 bales from Bahawal Pur at Rs 6100, 200 bales from Sahiwal at Rs 6100, 200 bales of cotton from Samandri at Rs 6125, 400 bales from Haroonabad at Rs 6150-6200, 400 bales from Khanewal at Rs 6150-6175 and 600 bales from Burewala at Rs 6150/6175, dealers 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 15.07.2014
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37.324 Kgs 6,050 155 6,205 6,155 +50
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Equivalent
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40 Kgs 6,484 155 6,639 6,585 +54
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