KARACHI, Jan 18: Cotton market on Tuesday showed firm trend as ginners raised their asking prices by Rs25-Rs50 per maund amid predictions of pressure on ready supplies.
The arrival figures of phutti into the ginneries released by the Pakistan Cotton Ginners Association (PCGA) at 13.761m bales were said be well below the market expectations viewed in the backdrop of rising mill demand against their export commitments, says a leading cotton analyst.
"The market has been eyeing on the arrival target of 14m bales plus for the current fortnight ended January 15, but the figures show a declining trend for the first time during the current season", he adds.As a result, ginners raised their asking prices amid speculation there could be a pressure on ready supplies towards the close of the current season, although spinners were in no obliging mood.
What worries spinners most is a considerable decline in the unsold stock lying in the ginneries at 1.1m bales, which reflects that big groups are out to grab the floating stocks at the current prices before it is too late, brokers said.
The TCP tally so far is around 2.7m bales but it is not clear whether or not it remain in the market in the backdrop of falling unsold stocks with the ginners, dealers said.
"The fears of short supply could cause a price flare-up in the coming weeks as is reflected by an instant rise in prices the very next day after the release of the arrival figures", they said.
Moreover, global cotton markets are also heating up as winter demand is picking by those countries, whose industry is fed by import from the surplus countries. Official spot rates were, therefore, firmly held at the last levels, although some of the deals reported in the ready section were done well above them depending on the quality.
Ready business was light as spinners played safe partly owing to delivery problems and partly to higher asking prices and as a result about 4,000 bales changed hands as under: 1,600 bales, Pak pattan and 200 bales, Kabula at Rs2,100 and 1,000 bales, Hasilpur at Rs2,050 to Rs2,060.
The following are Tuesday's new crop Karachi Cotton Association (KCA) official spot rates for local dealings in Pak rupees for base grade 3 staple length 1-1/32" micronair value between 3.8 to 4.9 NCL.
