KARACHI, Feb 9: The physical trading on the cotton market on Saturday showed further expansion as spinners covered positions at the attractively lower levels on the perception of positive outcome of the president’s US visit.
Already the shipment of textiles against previous as well as fresh orders has started picking up and spinners and mills hope the pace could accelerate after the president’s visit.
“What seems to have encouraged spinners to resume buying operations is the perception of some quota relaxation, which could give further depth to textile exports to the US,” floor brokers said.
But spinners claim they are still facing the problem of large unsold inventories built-up because of Afghan war in the absence of fresh import orders, the situation is, however, improving.
“It is still a takeoff point,” one spinner says, adding “we have to go a long way to clear the unsold positions.”
The US is claimed to be the largest buyer of Pakistani textiles after the European Union and if the president manages to lift quota curbs there will be a boom in the cotton trade and the current export figure could swell to $3 billion from $2.5 billion.
The US is billed as one of the largest trading partners of Pakistan in textiles and any slight easing of the prevailing quota restrictions could give the needed push to exports, hit by worldwide recession, dealers said.
For the last couple of sessions, spinners and mills are in the market as a prelude of president’s US visit and predictions of a positive outcome, which could give the needed boost to exports.
Market sources said the revival of mill demand though was modest, it had forestalled further decline in prices as for the last couple of sessions prices had stabilized between Rs1,550 to Rs1,600 per maund.
Meanwhile, ginners are still unhappy over the developing conditions and seeking official help as prices of both phutti and lint have declined well below the official support rates.
But as stipulated in the cotton policy, the intervention from the TCP is now overdue to forestall further decline in prices, ginners say.
Ready offtake was active for the second session in a row as till late in the evening another 10,000 were sold as under:
SINDH TYPE: 200 bales of Sanghar at Rs1,490, 400 bales, Bucheri at Rs1,600, 200 bales, Daur at Rs1,600, 1,200 bales, Mehrabpur at Rs1,550, 400 bales, Rasoolpur at Rs1,525 and 400 bales, at Rs1,550.
PUNJAB VARIETY: 2,000 bales of Bahawalpur at Rs1,525, 1,000 bales at Rs1,550 and 1,000 bales at Rs1,590.
