KARACHI, Sept 27: Trading activity on the cotton market on Tuesday was well-sustained for the sixth session in a row as price ideas of ginners and spinners have found a meeting ground.
Both are not going all-out to sell or grab the floating stock amid conflicting perceptions. While the ginners were holding on in part to their daily stocks in the hope of an increase in prices, the spinners were making guarded covering purchases to accelerate their daily intake in case of a price fall from the current levels, dealers said.
But the spinners are also ensuring that lint prices should not rise from the current levels, which could create some problems for them on the export front, notably their forward sales of cotton yarn and cloth, they claim.
“Spinners have curtailed their daily intake to an average 10,000 bales with a view to containing any speculative rise in lint prices,” brokers said. “The current increase in phutti prices to about Rs1,000 per 40 kg literally have no bullish impact on the prevailing prices at the buyers end and credit for this goes to the mills.”
Although there is a relative lull on the cotton export front owing to highly volatile world market, and foreign buyers’ reservations in regard to asking prices, local private sector exporters are treading slow on this front.
According to figures available from the Export Promotion Bureau, only 19,435 bales had been registered with it from Aug 1 to Sept 23, 2005.
Meanwhile, conflicting reports about the size of the crop and reported damage to the crop in some areas of the southern Punjab belt because of rain and floods have no negative or positive impact on the price line, which are stable around previous levels for the last two weeks.
Higher New York cotton futures followed by damage to the US crop in the recent hurricanes failed to influence local prices on the higher side as supply and demand factors remained the guiding force before the sellers and buyers, brokers said.
Official spot rates were, therefore, firmly held at the previous levels, despite the fact that in the ready section prices are quoted a bit higher.
Ready offtake was active totalling about 8,000 bales as under:
SINDH TYPE: 1,400 bales, Mirpurkhas at Rs2,130; 800 bales, Tando Muhammad at Rs2,150 to Rs2,175; 200 bales, Jhole at Rs2,140; 200 bales, Sarari at Rs2,175; 100 bales, Khipro at Rs2,140; 400 bales, Shahdadpur and 200 bales, Nawabshah at Rs2,160 to Rs2,175; 200 bales, each Buchari and Sakrand at Rs2,175.
PUNJAB VARIETY: 200 bales, Lodhran, Pul Bhaghar, Toba Tek Singh, Jhang, and DG Khan at Rs2,190; 200 bales, Gojra at Rs2,180; 400 bales, Pir Mahal, 200 bales, Sahiwal, 200 bales, Hasilpur, 400 bales, Mian Channu, and 200 bales, Rajanpur at Rs2,200; 600 bales, Burewala and 600 bales, Khanewal at Rs2,180 to Rs2,200.
