Most of the buyers were on the sidelines on the cotton market on Tuesday after a two-year low in the NY cotton futures, dealers said. The official spot rate extended its slide, losing more Rs 100 to Rs 6,200, they added. The prices of seed cotton from Sindh lost Rs 100 to Rs 3200 and Rs 3225, and the rates were same in the Punjab, they said. In the ready session, about 2600 bales of cotton sold at Rs 6200-6500, they said.
They said that some buyers took interest in buying due to lower prices of cotton. Unfortunately, despite good cotton production in the country, main buyers failed to make deals in a big way due to short supply of power and gas, they said. Electricity and gas shortage made mills non-functional in the country, indicating not very picture for future, they added.
Cotton analyst, Naseem Usman said arrivals are improving in the Punjab, trade volume could not go up during the last days but now we expect buyers from Bangladesh and Vietnam would show interest in fresh buying, which may help in reviving activity in the cotton trade. Both countries were main buyers but they were conspicuous by their absence during the last days, other analysts said.
Reuters adds: ICE cotton fell to a two-year low on Monday on hedge pressure and bearish expectations that the government would raise its outlook for supplies in United States, the world’s top exporter. The benchmark December cotton contract on ICE Futures US tumbled to the psychological support of 70 cents before ending down 1.85 cents, or 2.6 percent, at 70.21 cents a lb. Selling began shortly after the market opened late, following the US Fourth of July holiday on Friday, pushing futures to fresh lows as volumes picked up. It was the lowest for the third-month contract since July 2012.
The following deals were reported: 200 bales from Mirpurkhas sold at Rs 6200, 600 bales from Kotri at Rs 6200-6250, 400 bales from Tando Adam at the same rate, 800 bales of cotton from Sanghar, 400 bales from Shahdadpur at the same rates and 200 bales from Burewala at Rs 6500, dealers said.