Growers' strategy not to sell cotton at lower-than-expected levels boosted the spot rate and prices in ready business on the cotton market on Wednesday, dealers said The Karachi Cotton Association (KCA) official spot rate was raised by Rs 200 to Rs 5200, they said. In both, Sindh and Punjab, seedcotton rates showed an improvement of Rs 200 to Rs 2300-2400, they said.
Additionally, in the ready business, trading activity was nearly half as over 8,000 bales of cotton changed hands between Rs 5000-5350, dealers said. Some brokers said that trading came down as a result of growers' attitude towards the strategy for minimising the losses. It is most likely that prices may retain the present level in the near future. Naseem Usman said that mills were ready to buy but growers and ginners were not ready to sell at the lower rates.
In the beginning season of picking operation, watch must be kept over the rates, why should rates come sharply down? Some experts said. One factor appears that bulk of phutti arrivals, made the growers worried but it does not mean that they want to make loss instead of gains, they said. On Tuesday the NY cotton futures ended limit up as speculators bought on technical signals and analysts said momentum from the rally would continue tomorrow, analysts said.
Benchmark December on ICE Futures US rose its four-cent daily limit to conclude at $1.0076 per lb, with the session low at 93.20 cents. Volume hit around 19,200 lots at 2:50 pm EDT (1750 GMT), almost 15 percent above the 30-day norm, Thomson Reuters preliminary data showed.
The following deals were reported: 400 bales of cotton from Tando Adam sold at Rs 5200, 1000 bales from Sanghar at Rs 5000-5200, 800 bales from Shahdad Pur at Rs 5100-5200, 400 bales from Mir Pur Khas at Rs 5200, 600 bales from Chichawatni at Rs 5000-5200, 400 bales from Bahawal Pur at Rs 5100-5200, 200 bales from Noor Pur at Rs 5100, 200 bales from Pir Mahal at Rs 5100, 200 bales of cotton from Kassowal at Rs 5200, 200 bales from Mailsi at Rs 5200, 400 bales from Lodhran at Rs 5200, 200 bales from Multan at Rs 5200, 1000 bales from Burewala at Rs 5200-5350, 200 bales from Vehari at Rs 5200, 200 bales from Arifwala at Rs 5250, 200 bales from Shujabad at Rs 5250, 200 bales of cotton from Mian Chaunnu at Rs 5300, 200 bales from Haroonabad at Rs 5300.
===========================================================================
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 26.07.2011
===========================================================================
37.324 Kgs 5,200 120 5,320 5,120 +200
---------------------------------------------------------------------------
Equivalent
---------------------------------------------------------------------------
40 Kgs 5,573 120 5,693 5,478 +215
===========================================================================