KARACHI, May 17: Physical trading on the cotton market on Tuesday remained slow as leading spinners and mills were preparing for the next TCP auction. However, a stray lot of 800 bales came in for trading and as price ideas of buyers and sellers matched the deal was finalized around Rs2,060.
After having lost all hopes about an imminent price flare-up at the fag-end of the season, ginners holding on to stray stocks of both fine and inferior lots are now trying to sell them, floor brokers said. But latest decline in New York cotton futures may create some problems on the price front for both the ginners and the TCP, they fear. “The TCP held back its next tender until world prices stabilize around the previous levels.”
New York cotton futures during the last couple of sessions has dropped to 52.01 and 52.75 cents per lb including Monday’s fall of 1.74 and 1.20 cents for both the maturing May and the ruling July contracts. Meanwhile, reports coming from the major cotton growing areas including central, upper Sindh, southern Punjab and central Punjab show that sowing of the new crop is well in progress from May 15 and will end on June 15, billed as an ideal period to grow a good crop.
Based on the relative increase in the acreage, the next season’s production target is set at 15m bales as compared to current year’s 14.347m bales, achievement of which will largely depend on the weather conditions and an efficient pest control programme, market sources said.
The early sown cotton crop is claimed to be in a good conditions because of climatic conditions in the lower Sindh cotton belt, and the crop will arrive on the market in late July or early August, they said. Already, forward deals in the lower Sindh lint are being done at Rs2,300 per maund or at the official spot rates at that time.
Official spot rates were, therefore, again quoted unchanged at the last level of Rs2,200 per maund but in physical trading average price is quoted around Rs2,050 per maund. Ready off-take was light as barring a deal of 800 bales at Rs2,050, no other transaction was reported.
