Some activity was seen on the cotton market on Saturday as needy mills came to meet the urgent needs after the settlement on the tax issues, dealers said. Karachi Cotton Association (KCA) official spot rate was steady at Rs 12,500, they said. In Sindh and Punjab, phutti price of low type was at Rs 4000 and superior type also unchanged at Rs 5000, they said.
In ready business nearly 1800 bales of cotton changed hands at Rs 13000, they added. According to the market sources, spinners and mills were a bit active to make urgent needs as some issues, which were creating confusions among the cotton traders, now settled down and it looks that trading may pick up in the coming days.
In the meantime, it seems the ginners may not lower the asking prices due to short unsold stock with them, they said. Unregistered firms came under the net of tax, other registered firms are not bound to pay tax rates, they said. On Friday the US cotton futures closed lower on investor profit-taking as players opted to take cash home after fiber contracts surged in the previous session due to a bullish government plantings report, analysts said.
The key May cotton contract on ICE Futures US fell 4.68 cents, or 2.3 percent, to finish at $1.9555 per lb, dealing from $1.9506 to $2.0100. On the week, cotton is down 4.4 percent. The new-crop December cotton contract slipped 0.32 cent to end at $1.3218. Total volume traded in the cotton market was around 23,800 lots, about 3 percent below the 30-day norm, Thomson Reuters preliminary data showed. Volume traded on Thursday reached a six-week high of 41,765 lots, ICE Futures US data showed. The following deals were reported: some 600 bales of cotton from Ghotki sold at Rs 13000, 200 bales from Khanpur, 600 bales from Alipur and 400 more bales from Arifwala at the same rate at Rs 13000.
===========================================================================
The KCA Official Spot Rate for Local Dealings in Pak Rupees
---------------------------------------------------------------------------
FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"
---------------------------------------------------------------------------
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
===========================================================================
Rate Ex-Gin Upcountry Spot Rate Spot Rate Difference
For Price Ex-Karachi Ex. KHI. As Ex-Karachi
on 01.04.2011
===========================================================================
37.324 Kgs 12,500 120 12,620 12,620 NIL
---------------------------------------------------------------------------
Equivalent
---------------------------------------------------------------------------
40 Kgs 13,396 120 13,516 13,516 NIL
===========================================================================