KARACHI, May 21: Cotton market closed the weekend session on a steady note as stray business was reported at the higher rates and mostly at ginners’ options, brokers said. Cotton analysts said the US ban on some categories of textile imports from China has altogether changed the world market outlook amid perceptions that the local industry could bridge in the gap provided the situation is judiciously exploited.
The current mill scramble to corner the floating stock of lint both from the ginners and the TCP is reflective of the fact that the local industry is already on it. But it is not clear whether or not some of them have any signals from their American trading partners to standby and fill-in the gap where possible, they said.
Leading spinners groups were, therefore, out to lift all the lots being offered by the TCP in its May 21 auction. Some of the participants including leading brokers who were present in the proceeding said the bid rates were in line with the prevailing local as well as foreign rates.
“It could well prove another successful auction of 67,000 bales by the TCP as spinners and mills still needing more supplies have offered competitive prices for the fine lint”, market sources said.
The next tender date fall on May 28 and well mean that the TCP is gradually loading its long position of 1.6m bales, purchased during the season to support the market. Bulk of the lint in its godowns is claimed to be of fine quality having a medium staple length, while inferior stuff is also being offered at lower reference prices, they said.
Spinners and mills have so far purchased about 12m bales from the open market since the beginning of the season and may need another million or so bales to cover their forward sales of textiles, they said.
New York cotton futures showed fresh fractional decline of 0.10 and 0.20 cents per lb but did not breached the barrier of 50 cents for both the ruling July and the distant October contracts at 50.05 and 51.75 cents per lb respectively.
Local official spot rates on the other hand did not show any change and were firmly held at the last level of 2,250 per maund. On the ready counter, a lot of 200 bales, from a central Sindh ginnery of Buchri changed hands at Rs2,275 per maund.
