KARACHI: A festive mood prevailed on the cotton market when trading resumed on Tuesday after Eidul Azha holidays, however activity remained poor due to thin attendance of traders.
Phutti (seed cotton) arrival has yet to resume and as a result most ginning units in Sindh and Punjab could not operate. However,cotton prices remained steady as there was demand and according to brokers around 4,000 to 5,000 bales were finalised at the rate ranging from Rs6,000 to Rs6,075 per maund.
It would take a few days before normal trading resumes on the market with improved flow of phutti from cotton fields into ginneries, traders said.
According to International Cotton Advisory Committee (ICAC), cottonconsumption for 2017-18 would be 2 per cent higher at 25.1 million tonnes over the last season (2016-17) when it rose by 1pc at 24.5m tonnes.
Meanwhile, the Indian government, seeing good results, has extended its cotton policy by another year.
The policy was ending on Sept 3, 2017.
The world`s leading cottonmarkets remained firm but New York cotton closed higher on fear of another hurricane hitting US state of Florida. Hurricane Harvey has already made extensive damage in Texas which is largest cotton growing state in America.
Physical prices remain firm at lint market
KARACHI: The buyers in need of better grades of lint made deals on paying premium price at lint market while market’s sentiments remained steady on forward trading, traders at the Karachi Cotton Association (KCA) said.
KCA kept the spot rate intact at Rs 6,050 per maund in order to provide support to weak stakeholders of raw grade to ward off minimal price level, said floor brokers.
During the trading session, buyers in Sindh and Punjab stations purchased better grades at around Rs 6,575 per maund, while sellers offered all grades of lint at around Rs 5,975 per maund to Rs 6,650 per maund in order to capitalise maximum returns on their proceeds, brokers said.
Demand for second grade of lint would remain on high side as spinners and mills need better stuff for blending purpose, said floor brokers.
Most of the buyers made deals according to their immediate need of lint on back of grade issue and in anticipation of decline in spot rate, they added. Buyers in Sindh and Punjab stations made one month forward deals for all grades on competitive price at around Rs 6,025 per maund to Rs 6,625 per maund while private sector commercial exporters bought all grades in Punjab and Sindh stations at around Rs 5,975 per maund to Rs 6,225 per aund, traders said. The textile sector is in need of better and second grade lint as it has to accomplish exports orders, said Shakeel Ahmad a fibre analyst.
Cotton import by textile sector would go up and demand for fine grades would also increase. Due to grade issue in parts of Sindh and Punjab stations and after effects of recent rains on crop, buyers made forward deals for all grades of lint at around Rs 6,175 per maund to Rs 6,575 per maund.
More than 900 bales changed hands with more than 60 percent of Punjab’s share in trading. New York October Futures 2017 contract remained firm at 75 cents per pound, December Futures 2017 contract at 75 cents per pound and Cotlook A Index was intact at 86 cents per pound.