Cotton market observes dull trading activity

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KARACHI: The cotton market witnessed dull trading activity on Wednesday when it opened after three days of closure, however, spot rate remained unchanged, a dealer said.

The spot rate remained unchanged at Rs5,300 per maund (37.324kg) and Rs5,680 per 40kg, while ex-Karachi spot rate remained firm at Rs5,330 per maund and Rs5,810 per 40kg after addition of Rs130 as upcountry expenses.

An analyst said that the market would remain tight in the coming days, as it is expected that the crop arrivals would increase till December 1. But, he said, an increase in prices in the international market would stabilise the local market.

According to the data released by Pakistan Cotton Ginners Association (PCGA), cotton arrival posted an increase of 15.47 percent to 9.65 million bales against the corresponding period last year. On a province-wise basis, cotton arrivals in Punjab increased by 43.30 percent, while arrivals from Sindh reported a decline of 31.84 percent.

Based on the data, major producing areas of Sindh; Hyderabad, Mirpurkhas, Sanghar and Benazirabad (Nawabshah) are badly hurt due to rains in the province. “However, continuous support from Punjab has been able to lift production in the country,” the analyst said.

The PCGA has urged the Trading Corporation of Pakistan (TCP) to enter as the second buyer in order to safeguard farmers and ginners from a sharp dip in prices against last year. In addition a minimum support price of cotton at Rs6,000 per maund has also been proposed by the PCGA along with the purchase of unsold stocks from the ginners.

The international market increased this week. December contracts at the New York cotton market increased by 1.80 cents to 93.31 cents per pound and March contracts increased by 1.59 cents to 93.81 cents per pound. China cotton index also increased by a few points.

Karachi cotton market recorded transactions of around 2, 200 bales in between Rs4,900 to Rs5,300 per maund. Upper Sindh’s 1,000 bales were sold at Rs5,100 to Rs5,200 per maund, 400 bales of Garh Maharaja at Rs4,900 to Rs5,000, while 400 bales each of Sadiqabad and Rahim Yar Khan were sold at Rs5,300 per maund.

Source: http://www.thenews.com.pk/TodaysPrintDetail.aspx?ID=81127&Cat=3

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