KARACHI, Oct 4: Cotton prices on Tuesday rose further by Rs25 per maund on active support extended by the mills followed by reports of a short crop well below the official target of 15m bales.
But in physical trading most of the deals in Sindh and Punjab varieties were finalized higher by Rs25 to Rs50 per maund, reinforcing the general perception that the crop may be lower than the target.
While Sindh variety was sold at a uniform rate of Rs2,250 per maund its counterpart in the Punjab was quoted around Rs2,300 per maund on the higher side, while inferior varieties were traded a bit lower.
“It is too early to predict about the shortfall in the crop”, cotton analysts said “the lower arrivals of phutti into the ginneries for the initial picking at about half million bales can’t be made the basis of crop shortfall”.
“The grower has now become a bit wiser after having received massive battering at the hands of middleman and some others”, brokers said “now he only sells his phutti to ginners after the price match his parity level otherwise he holds on to his stocks”.
Moreover the arrivals were based on the central Sindh and Punjab cotton belt where the picking of phutti has started now that too on modest scale, they said.
In cold night conditions, growers generally hold on to their stocks as there is fear of damage to the quality, although there is a danger of quality loss after February, they added.
They are expected to follow the line of sugarcane growers who are getting a fair price of their produce on cash basis since the last two years and the cotton growers are out to follow them and sell their phutti at the higher rates, market sources said.
The official arrival figures of phutti are due any day and will end the speculation about the crop shortage at least at this stage, they said.
The sentiment in part was also influenced favourably by the higher New York cotton futures, which were quoted higher by 1.05 and 1.13 cents at 52.55 and 54.24 cents per lb for both the ruling October and the distant December contracts.
Ready business was active totalling about 15,000 bales, the following being some of the notable deals.
SINDH VARIETY: 1,600 bales, each Nawabshah and Shahdadpur, 400, Shahpur Chakkar, 200 Sakrand, 600 bales each, Sangar, Khipro and 400 bales, Bucherai at Rs2,250.
PUNJAB TYPE: 2,800 bales, Jahania, 800 bales each Rahimyar Khan and Sadiqabad, 600 bales each Kabirwala Mian Channu and Khanewal, at Rs2,300, 200 bales, each Fort Abbas, Toba Tek Singh, Bahawalpur and Pakpattan at Rs2,250, 200 bales, each Khanpur and Vehari, Mamon Kanjan, Haroonabad, and 400 bales, Hasilpur at Rs2,275.
