Declining trend in supplies caused steep rise in prices on the cotton market on Wednesday, dealers said. The Karachi Cotton Association (KCA) official spot rate rose by 75 Rs 5,625, dealers said. In the ready business over 10,000 bales of cotton changed hands between Rs 5400-5850. On two-month credit, a deal of 300 bales of cotton from Daur station sold at Rs 5800.
Phutti prices in both the Punjab and Sindh were at Rs 2100-2200, they added. Falling quantum of supply at the end of current season and higher trend in the international market are basic factors pushing the rates up locally, they said. In India cotton is selling at 86 cents per pound, they added.
It looks that the prices may go up in the coming days due to short supply position, they said. According to a report the United States will change its export credit guarantee programme and create an assistance fund to try to end a long-standing trade dispute over cotton with Brazil, the US government said on Tuesday.
The last-minute agreement comes as Brazil was set to apply tariffs and lift patent protections on US goods worth $829 million after a 2009 World Trade Organisation (WTO) ruling against US cotton subsidies and export credit guarantees. On Tuesday the New York cotton futures settled mostly firmer on investor buying as players seemed to be adjusting their positions ahead of the release of a government crop report at the end of the week, brokers said.
The key May cotton contract added 0.01 cent to close at 82.29 cents a lb, trading from 82 to 83.17 cents. Volume in the May contract hit 8,439 lots at 2:35 pm EDT (1835 GMT). July cotton fell 0.16 cent to finish at 83.36 cents and new-crop December added 0.56 cent to conclude at 75.99 cents.
The following deals were reported: 300 bales of cotton from Daur sold at Rs 5800, 200 bales from Mirpur Khas at Rs 4850, 1260 bales from Chundko at Rs 5600, 1000 bales from Khan Pur Mehar at Rs 5700, 574 bales from Vehari at Rs 5400, 820 bales from Dunia Pur at Rs 5600, 1200 bales from Rahim yar Khan at Rs 5700 and 800 more bales from Khan pur at the same rate, they 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"
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
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Rate Ex-Gin Upcountry Spot Rate Ex-Karachi
for Price Sales Tax @ 15%
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37.324 Kgs 5,625.00 100 5,725.00
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Equivalent
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40 Kgs 6,028.00 100 6,128.00
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