Mills and spinners were busy in finalising news deals because rates were matching with their psychological level, dealers said on Saturday. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 6,500, they said. In the ready business nearly 7,000 bales of cotton changed hands between Rs 6300-6650, they said.
The seed-cotton in Sindh was unchanged at Rs 2700-2800 and rates in Punjab were also same at Rs 2700-2950, they said. According to the market sources mills took interest in fresh buying as prices were matching with their psychological level. In the meantime some were on the sidelines to observe the latest development, so it is expected that prices may move slightly in pre and post-Eid sessions.
Some brokers said that prices stabilised during the week due to damage to standing crop in Sindh cotton growing areas. After the cultivation of Bt cotton, there were expectations for bumper crop, but it looks damage to crop may cause rise in prices, they said. The mills and spinners are not able to make deals in a big way because of economic crisis the world over, they said. In order to keep growers' earning at a certain level if prices fall, the Sindh Agriculture Department after recent sharp fall in the cotton prices, recommended a support price of Rs 3,600 per 40 kg for seedcotton.
As a result of recent sharp decline in the prices, growers came under pressure due to heavy cost of production, but they could not get fair return, some analysts said. Report showing that India's largest textile maker Alok Industries expects its cotton consumption to rise more than 10 percent in the current fiscal year, faster than the economy, even though polyester will drive most of its growth, the firm's finance head said.
On Friday the NY cotton futures finished easier on investor sales inspired by turmoil in outside markets, although worries over crop problems in several countries pared losses, analysts said. European stocks slid while US stocks see-sawed, with gold scaling record highs and other commodities climbing on the dollar's weakness.
The key December cotton contract on ICE Futures US fell 0.73 cent to finish at $1.0622 per lb, moving from $1.0839 to $1.0513. On the week, the market was up almost one percent. Trading volume totalled more than 8,600 lots, over 50 percent below the 30-day norm, Reuters data showed. Total volume traded on Thursday hit 14,682 lots, up from the Tuesday level of 7,113 lots, which was the lowest level of business since May 23, ICE Futures US data showed.
The following deals reported: 1000 bales of cotton from Shahdad Pur sold at Rs 6300-6350, 1000 bales from Tando Adam at Rs 6300, 1000 bales from Sanghar at Rs 6300, 1000 bales from Burewala at Rs 6500-6650, 200 bales from Head Bakainee at Rs 6650, 200 bales from Sadiqabad at Rs 6600, 400 bales from Arifwala at Rs 6600, 400 bales of cotton from Sahiwal at Rs 6500-6600, 200 bales from Chichawatni at Rs 6600, 200 bales of cotton from Toba Tek Singh at Rs 6600, 200 bales from Murid Wala at Rs 6600, 400 bales from Pir Mahal at Rs 6550, 400 bales from Kabirwala at Rs 6550, 400 bales from Vehari at Rs 6550, 200 bales from Mian Chunnun at Rs 6550, 400 bales from Haroonabad at Rs 6500, 200 bales from Chistian at Rs 6500 and 200 bales from Mailsi at Rs 6500, 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"
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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 19.08.2011
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37.324 Kgs 6,500 120 6,630 6,630 NIL
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Equivalent
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40 Kgs 6,966 120 7,096 7,096 NIL
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