Cotton prices extended overnight gains amid short supply of quality lint in the process of trading, dealers said on Saturday. The official spot rate maintained rising trend for the second day, gaining further Rs 50 more at Rs 5,300, dealers said. In Sindh, seed cotton prices were at Rs 2000-2200, and in Punjab prices at Rs 2500 and Rs 2900, they said. In the ready business, around 13,000 bales of cotton changed hands between Rs 5100 and Rs 5500, they said.
Market sources said that some motivating factors propelled mills and spinners to make fresh deals despite the fact that rates were not matching with their psychological levels. Other experts said that in fact buyers were under pressure, trying to replenish their stock amid rising fears of further increase in quality cotton in the coming days.
According to a fortnightly report of Pakistan Cotton Ginners Association (PCGA), out of total arrivals, Phutti equivalent to 9.73 million bales had undergone the ginning process. Besides, recent rains in cotton belt delaying sowing, giving impression about further dearth of lint cotton, they said.
The experts, however, advised growers to start the cultivation of cotton and complete it before the mid May to get bumper yield. They were also of the view that farmers should cultivate approved varieties of cotton seeds over maximum space because its production not only plays a pivotal role in meeting food and cloth requirements of people but it also helps growers in mitigating financial issues.
Reuters adds: Cotton futures slipped over two percent on Friday on rumours that world's top consumer China is preparing to auction off some of its vast stockpile of the natural fibre next month, potentially unleashing fresh supply on a saturated global market.
Speculators upped a bearish bet in cotton to the biggest on record in the week ended March 15, US government data showed on Friday. The front-month May contract on ICE Futures US settled down 1.2 cents, or 2.06 percent - the biggest percentage loss in more than a week - at 57.16 cents per lb, after touching a low of 56.82 cents. The contract ended the week down about 3 percent.
The following deals finalised: 800 bales of cotton from Mirpur Mathilo at Rs 5300, 700 bales from Khanpur Mehar at the same rate, 800 bales from Multan at Rs 5100-5275, 400 bales from Liaquatpur at Rs 5350, 3600 bales from Khanpur at Rs 5375-5475, 6000 bales from Rahim Yar Khan at Rs 5400 and 1311 bales from Fazilpur at Rs 5500, they said.
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The KCA Official Spot Rate for Local Dealings in Pakistan 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 18-03-2016
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37.324 kg 5,300 135 5,435 5,385 -50
Equivalent
40 kgs 5,680 145 5,825 5,771 -54
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