Prices drifted lower on the cotton market on Monday as main participants were on the sidelines, hoping for a further decline in the rates, dealers said. The official spot rate was unchanged at Rs 6,900, they said. Rates of seed cotton in Sindh were unchanged at Rs 2,200 and 2,800, in the Punjab prices were also inert at Rs 2,200, while the best type shed Rs 100 to Rs 3,100, they said.
In the ready business, over 2,000 bales of cotton changed hands between Rs 6,350 and Rs 7,000, they said. In cotton trade, there was no buying interest among businessmen due to falling demand in the world market, if foreign demand emerges, prices might improve in the coming days, some dealers said. Sharing the same views, cotton analyst, Naseem Usman said that despite having very little stock of fine quality, buyers were not moving ahead to grab all stock offered by ginners.
According to the Reuters, China - the world's top cotton consumer - kept volumes of cotton offered from its state reserves steady on Monday, defying expectations that it could ramp up sales to help ease tight domestic supplies after stockpiling most of the domestic crop. A government official had previously said Beijing would boost sales of state cotton reserves from April, which would hurt domestic and international cotton prices.
Besides, cotton prices in India are expected to edge higher this week, supported by lower supplies in the local market while lower-than-expected release from China and expectations that US farmers will sow a historically small crop are seen aiding sentiment. The April cotton futures contract on the Multi Commodity Exchange (MCX) rose 0.16 percent to 19,360 rupees per bale of 170 kg each at 0802 GMT. "Less than expected release by China and forecast of lower acreage in the United States are expected to keep cotton prices firm," said Prerana Desai, vice-president of research at Kotak Commodities. The following deals were reported: 515 bales of cotton from Pano Aqil at Rs 6,800, 400 bales from Ghotki at Rs 7,000, 200 bales from Mian Chano at Rs 6,350, 200 bales from Karmawala at Rs 6,350, same figure from Shujabad at Rs 6,500 an 400 bales from Lodhran at Rs 6,600, 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 30.03.2013
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37.324 Kgs 6,900 155 7,055 7,055 NIL
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Equivalent
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40 Kgs 7,395 155 7,550 7,550 NIL
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