Slow trading activity seen in cotton market

No visible change was seen on the cotton market on Tuesday as leading buyers were not taking interest in fresh deals due to lack of fresh leads, dealers said. The official spot rate was at Rs9100, they added. In the ready session, only 1600 bales of cotton from Fort Abbas was finalised at Rs8900-9275, they said.

Rate of seed cotton per 40kg in Sindh low quality was at Rs2800, while the best quality was unchanged at Rs4100, and in the Punjab prices of low quality were at Rs2800 while the fine type was available at Rs4600, they said. In Sindh, Binola prices per maund were at Rs1400-1800, in Punjab rates were at Rs1650-1800, they said and the rate of polyester fibre was at Rs176 per kg, they added.

Some market men observed that trading activity remained slow as both buyers and sellers remained on the sidelines. The market is sluggish as spinners are not making payments to ginners. Delay in payments is affecting cotton business. Due to huge losses, the growers and farmers were shifting their position from cotton sowing to other crops. The concerned authority is not able to meet growers' problems, despite long slogans of maximum facilities to the farmers. Besides, Minimum Export Price for cotton not announced.

Cotton analyst, Naseem Usman said that lacklustre condition likely to continue for the near future because of liquidity crunch and short supply of fine quality in the local market.

Adds Reuters: Cotton futures rose on Monday ahead of the government's monthly supply and demand crop report, which investors expected to show declines in production and ending stock numbers, while a gain in the US stock markets provided further support.

Cotton contracts for March rose 0.13 cent, or 0.19%, at 67.88 cents per lb by 01:22 p.m. EST (1823 GMT). It traded within a range of 67.62 and 68.36 cents a lb.

Total futures market volume fell by 27,813 to 35,449 lots. Data showed total open interest fell 12,929 to 240,086 contracts in the previous session.

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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  10-02-2020
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37.324 kg         9,100       160         9,260        9,260            NIL
Equivalent
40 kgs            9,752       171         9,923        9,923            NIL
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