KARACHI, April 29: Physical activity on the cotton market on Friday showed a slight improvement as a section of central Sindh ginners tried to sell their unsold stock of inferior lots fearing fall in prices. They, however, held on to stray lots of fine quality lint on the perception that prices could rise from the current levels in the backdrop of TCP auction.
“Ginners are not worried over the reports that the TCP has successfully sold 58,500 bales out of the 60,000 bales offered for sale to both local and foreign buyers at a competitive prices in last week’s auction,” analysts said.
The TCP is planning to float an international tender for the sale of identical quantity possibly by the next week and later may go for weekly auction.
However, the next week’s auction if the TCP decides to go for it could be very crucial for the future price outlook, although some of the leading cotton analysts say “it should go slow and must eye a price above 60 cents per lb not in very distant future.”
New York cotton futures is now under the tight grip of speculative forces and could push forward prices to new highs after having already surpassed 15-year highs during the current week, they said.
“It may not be that easy to dispose of a huge quantity of 1.5m bales,” they said. “It has to increase the size of offer to make thing more easy for it.”
Market sources said the ruling international prices around 58 cents per lb is an ideal price as compared to TCP investment and it must go for bigger offers in bales to partly cash in on the higher stock holding and partly to rising consumer demand.
The local textile sector still need a substantial quantity of lint is willing to pay a fair profit to the TCP on its investment if it obliges them in a bigger number of bales, they said.
New York cotton futures on Thursday recovered 0.70 and 0.61 cents per lb at at 58.40 and 57.02 cents per lb for both the ruling May and the distant July contracts.
Local official spot rates were again firmly held at the last levels, although some of the deals in Sindh variety were done below them.
The following are some of the deals, which gone through late on Friday evening; 1,200 bales, Sarari at Rs2,100 to Rs2,125, 800 bales, Nawabshah at Rs2,175.00 and 364 bales of Shahdadpur at Rs2,050.00.
