KARACHI, March 15: Cotton market on Tuesday recovered from the recent lows after ginners raised their asking prices followed by reports of lower than market expectations phutti arrival figures for the fortnight ending March 15.
But market sources said it was unannounced re-entry of the spinners and mills to grab the floating stock irrespective of the price tag, and signals were well-received by the ginners who immediately raised their asking prices by Rs50 to Rs100 per maund.
However, ginners who have been under pressure for the last couple of sessions after having lost more than Rs150 per maund in selling prices were not in an obliging mood and held on to their positions rather than selling below their asking prices, they added.
An idea of sharp increase in prices may well be had from the fact that some of the deals for fine lots were finalized around Rs2,400 and some dealers predicted that there could be a free-for-all after the official figures were released by the Pakistan Cotton Ginners Association during the next couple of days.
“Strange are the signals from the cotton trade as it seldom follow the rules of the game, notably supply and demand factor”, said a cotton specialist adding “Pakistan has just harvested a record crop of 14.255m bales but there is still pressure on supplies and some of the spinners are net importers”.
The floating stock of fine or contamination-free lots with ginners may not be sufficient to meet the mill demand but they will try to get a best price for it as the TCP is silent on the issues, he said.
Moreover, the rise of well above 50 cents per lb in foreign lint prices has made import more expensive and spinners and mills may not like to go beyond their export parity level for obvious reasons.
It was perhaps in this background that local fine stuff is expected to be more expensive in the sessions to come than may have thought at the fag-end of session.
Official spot rates were revised upward by Rs50 per maund in line with those at which physical trading is being done.
New York cotton futures on the other hand suffered a modest fall of 0.54 and 0.48 cents per lb at 53.11 and 54.43 cents per lb for both the ruling May and the distant July contracts respectively.
Ready off-take totalled about 15,000 bales mostly of fine lots, the following being some of the notable deals: 2,000 bales, Gothki, Dharki, Mirpur Mathelo at Rs2,300 to Rs2,400, 4,000 bales Rahimyar Khan at Rs2,325 to Rs2,350, 2,000 bales, Jalalpur and Shujabad at Rs2,300, 600 bales, Sadiqabad at Rs2,200 and 400 bales, Sanghar at Rs2,100.
