Cotton market: mills indulge in fresh buying on fears of further rise in rates

Mills indulged in fresh buying of cotton on Tuesday amid rising fears of more increase in rates, dealers said. The official spot rate held the week-end levels at Rs 8800, they added. In the ready session, about 4000 bales of cotton changed between Rs 7800-9400, they said. According to the market sources, quality factor is a main concern for the buyers, so the mills and spinners stuck deals at their psychological levels.
Cotton analyst, Naseem Usman said that the cotton is short of demand despite the fact that country is importing cotton to meet their requirements. Other experts said that prices of cotton may rise further if the US and China fail to finalise business deal, which was expected within some days. Adds Reuters: ICE cotton futures tumbled more than 3% on Monday, dropping to an over two-month low after US President Donald Trump said he would raise tariffs on Chinese goods this week, amidst aggressive trade talks between the two economies.
The most-active cotton contract on ICE Futures US July settled down 2.13 cent, or 2.81%, at 73.55 cents per lb. Total futures market volume rose by 30,995 to 47,380 lots. Data showed total open interest gained 658 to 219,888 contracts in the previous session.
The following deals reported: 400 bales of cotton from Nawabshah at Rs 8800, 722 bales from Bhira City at Rs 7800, 600 bales from Ghotki at Rs 9400, (Conditional) 1600 bales from Bahawalpur at Rs 8450/8500, 800 bales from Khanpur at Rs 9000 and 200 bales from Rahim Yar Khan at Rs 8900, 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 1-1/16"

                                    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 06-05-2019

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37.324 kg         8,800       160        8,960         8,960            Nil

Equivalent

40 kgs            9,431       171        9,602         9,602            Nil

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