The trading in cotton was boosted as ginners found themselves under pressure of expeditious phutti supply and exploit pest attack pretext seems to have not materialised during the week when the spot rate opened and closed at Rs 3450.
INTERNATIONAL SCENE:
The cotton futures as usual fluctuated both ways as players keeping an eye on nearly two weeks of US economic reports vaguely suggesting growth prospects to remain subdued for nearly a quarter or so. The major failure of cotton production in China has caused less concern than hope, which will help US known for largest exporters and worse sufferers from the on going recession. Still hopeful was USDA weekly crop report, which optimistically noted that US cotton crop was in excellent condition up to 53 percent, while only 17 pc depicting poor show.
Earlier during May/June weather condition was worrisome for the growers who abhorred hot and unfavourable weather. The week passed giving perception about the grains and commodities not very good, soya and wheat moving both ways. The players who watched the trend saw cotton could be in fair condition after the week and two still to come. The weekly export sales were absorbed for sure to show higher level adding to value of cotton to above 65 cents, basis December, often consumers buying cotton in good quantity sending futures on the rise and hoping good days ahead.
Besides day to day development, main being ongoing global decadence, the USDA supply/demand report offers players grip on the situation and firm direction how to tackle trading to reap gains. Towards the end of the week December lost nearly four-cent, as investors buying gradually slackened.
On Thursday the NY cotton futures settled easier on investor sales as the prospect of weak consumer sentiment is seen weighing on fibre contracts going cotton contract in New York eased 0.28 cent to end at 58.75 cents per lb, forward, brokers said. The December trading from 58.65 to 60 cents. Volume in the December contract was at 4,927 lots at 2:37 pm EDT (1837 GMT). March cotton shed 0.25 cent to finish at 61.19 cents.
On Friday New York Cotton futures settled softer on investor sales although trade buying enabled the market to hold its lows for the day while the trade mulled the market's next move. The December cotton contract in New York eased 0.12 cent to end at 58.63 cents per lb, trading from 58.53 to 60.34 cents. Volume in the December contract was at 6,207 lots at 2:42 pm EDT (1842 GMT).
March cotton shed 0.07 cent to finish at 61.12 cents.
Mike Stevens, an analyst for brokers SFS Futures in Mandeville, Louisiana, said that every time cotton futures slid to their lows for the session, "the possibility of trade buying" would stop the market from losing further ground.
But business was very light and subdued for the most part.
LOCAL TRADING:
The buyers must have been greatly consoled due to declining trend in the prices, to the extent that on Monday when 5000 bales of cotton changed hands, between Rs 3425 and Rs 3500. The spot rate was dropped by Rs 25 to Rs 34500 while phutti strangely rose in Sindh and Punjab to Rs 1750 and Rs 1775 and Rs 1800/1825. The falling trend caused some exporters too to be around. But both millers and exporters were cautions over differences in cotton prices and phutti prices. On Tuesday prices firmed as textile millers seen in renewed buying, as ginners seemed to have realised rising prices will not be in their interest. Good news is that Chinese team is coming to stem the rumour about pest and other deadly diseases.
However, farmers are also additionally being warned to keep watch on crop. The ginners for sometimes had been racing against the wind, raising prices on whimsical grounds including pest attack. On Wednesday they resorted to panic selling. Comprehending larger arrival of phutti. The TCP calling tender for selling 30,000 bales of cotton was another reason what made ginners apprehensive. However, the consumers lifted available lots nearly 10,000 bales in price range of Rs 3450 (equal to spot rate) and Rs 3540.
On Thursday phutti prices were set backed by expeditions arrival. Favourable prices allowed millers to lay hands on all the lots on offer hoping first five year textile policy may bring joy for them. The ginners according to market report fell in panic conditions turning unfavourable. Anyway on the day over 9000 bales of cotton changed hands at prices ranging between Rs 3425 and Rs 3550. Phutti prices ranged in Sindh and Punjab between Rs 1725 and Rs 1750. Spot rate was at Rs 3450.
On Friday trading activity gained momentum as mills continued buying on rising expectations about the exports of textile items to the US and European countries. The official spot rate was unchanged at Rs 3450, they said. In the ready business nearly 11,000 bales changed hands between Rs 3450-3550. Phutti prices, in Sindh were at Rs 1725-1750 and in Punjab, prices gained Rs 50 to Rs 1775-1800.
On Saturday strong mills' buying continued on the cotton market amid apprehensions about the pest attack on crop, dealers said. The official spot rate was unchanged at Rs 3450. In the ready business, approximately 11,000 bales changed hands between Rs 3425-3550, they said. Phutti prices fell modestly in Sindh were at Rs 1700-1725 and in Punjab prices dropped by Rs 50 to Rs 1725-1750, they added.
Market sources said that despite the fact that mills were busy in normal trading on fears of short supply as a result of slight damages by pest and cotton leaf curl virus (CLCV).
EU AGREES GSP PLUS STATUS:
The extent of happiness cannot be measured unless any amount coming in any way has put economy and country on sound footing. The EU has agreed, it had always been helping hand but country has gone from bad to worse. On some occasions, in the past rulers would take pride in arranging loans and spending leaving country in without anchor float. Till today country and economy has floated way ward allowing experts to call it a failed state. The dollar has always been considered as sheet anchor no matter what cost this country's poor paid.
The effects of the wars with India, in Afghanistan and today being fought within country mostly with our own people cannot be over emphasised. The coming time will bear witness what they paid in making this country strong and viable.
The finance minister is an excellent banker and man of finance has been proposing a lot of ways for effectively utilising the money being borrowed, which he perhaps knows not effectively worked in the past. But he is doing his best as he is trying to take with him all the so-called stakeholders to lead country to desired goal.
The US and the EU have always been helpful but they are being once again approached with little confidence this is the last beg. The EU, according to the finance minister was pursued for trade and market access so was the US. Both have been facing recession uncertain whether end is in sight. Hence talks with them will lead to some positive end are uncertain too.
TEX POLICY APPRECIATED:
Seemingly all the big wigs of textile industry have went out of the way to appreciate the new policy. This augurs well for the textile industry, which was looking for knowledge based export sector to replace it. Those in government public relations department should have sifted the past criticism of policy or just talk held between authorities and the praise being showered over textile policy. The time is required to follow things to come after five years - the government held out assurance to give all that textile manufacturers and exporters of textile products wanted.
The confidence in the textile ministry's efforts to meet needs squarely including, besides dozens of promises stuck up Rs 4 bn R&D amount and power and gas supply without hitch and let up. Such promises if considered by government possible, who on earth can doubt, the latter is bound.
The new government and new rulers vision regarding assessing things are different and positive which is very encouraging. The switch over in vision holds out assurance that economy and country is going for sure to present bridal look in not too long future.
Indeed, the assurance seems to have been based on fickle ground. The money that will have to be used to satisfy the demands of exporters of this country is coming at the cost of loans. Loans do not come without high interest rates. It is prayer God Almighty is merciful that new rulers begin a new and at the end of their terms praise is showered from all round.
"FINANCIAL EYE OF STORM HAS PASSED":
Is the above headline true for the global recession or the most Asia. As far as this country is concerned seems far off from above remark. The remark comes from Singapore PM Lee whose country or so-called city state, which was celebrating 44th anniversary of its independence - 18 years behind Pakistan's which celebrated 62nd anniversary the other day.
Singapore economy showed signs of rebound in the second quarter with GDP soaring 20.7 percent over the previous quarter. Pakistan is rejoicing first five-year textile policy, which has all the ingredients to achieve $25 billion (which is much less than South Korea's annual exports of textile products without basic raw materials of its own).
For the first time all belonging to textile sector expected the sector is going to have good days provided all the decision implemented in letter and spirit. The horribly awkward looking power and gas position is sunken neck deep and horribly yet is position that all consumers simply don't pay, meaning that cure is not in sight. Non payers turn habituated to ever pay any bill-besides, the decisions authorities take need to be implemented honestly. But issues remain in this country unresolved and every new government takes cover behind the wrongs done by the outgoing government.
STRIKE DEAL FIRST:
A successful Doha round trade deal could boost the global economy by $300-700 billion a year. Eight years back, rich men had called for the round, to help poor countries prosper through trade. The economists calculated are similar in size to stimulus packages deployed by the biggest countries to tackle the world economic recession.
The economists have given strong call in the Doha round by next year. The hope afresh has been expressed before Delhi meeting to re-launch the talks collapsed due largely to differences between the US, India and China over steps to protect subsistence farmers from floods of imports and eliminate duties in some industries.
The way report discusses the depth, gets confused how much was likely to yield in terms of billions. But some who are widely accepted as economists/rich meet at certain quantity. Taking proposed agreement in agriculture and industrial goods, they understand would increase exports by $65 billion annually. How these calculations, wrong or nearly right are going to help start talks and strike a deal? The world is large and all have experiment in one business or erecting dam - what they must have come to conclude at last that a deal is must. When the warmongers go for destroying the city built with hard labour they don't calculate casually and destruction. Thus if original creators of the WTO are serious they must strike the deal first.