KARACHI, Oct 19: Cotton prices on Wednesday eased from the overnight highs as ginners could not precisely decide how to operate in an uncertain crop outlook. That is perhaps why lint prices are showing an erratic movement, falling and rising on the negative and positive news about the size of the crop, without having an idea of the possible size based on the latest arrival figures released by the Pakistan Cotton Ginners Association (PCGA) on Oct 18, brokers said.
“The crop is short by over a million bales as the PCGA figures for the second consecutive fortnight show”, says a leading broker “miracles seldom happen essentially in the cotton world”.
Spinners have already adjusted their forward buying on the basis of a crop of 11 to 12m bales and what is now important for them is to have it at a competitive price, he added.
Persistent fall in New York cotton futures is also making imports of lint for them more competitive if there is need to supplement the local production in case it is lower than the current estimates, he said.
There could be an improvement in the total crop figure at the end of the season but certainly the target of 15m bales now appears to be an elusive goal and spinners and mill owners knew it through their own crop monitoring teams and are trying to keep prices within the current levels.
“It is now a straight fight between the spinners and the growers but latter who was in a commanding position some days back is now trying the hold the fort with a great effort”, some others said “but the fall in their selling prices of phutti reflects they are on the receiving end at least for the near-term”.
Official spot rates were lowered by Rs35 per maund and in physical trading most of the deals were finalized Rs50 down as compared to overnight rates.
New York cotton futures fell further by 0.63 and 0.42 cents for both the ruling December and the distant March settlements at 55.37 and 57.17 cents per lb respectively.
Ready off-take was relatively slow as ginners mostly held on to their positions and were not inclined to lower their asking prices. About 7,000 bales changed hands as under.
SINDH VARIETY: 600 bales, Sanghar at Rs2,315 to Rs2,325 and 600 bales, Nawabshah at Rs2,400.
PUNJAB VARIETY: 200 bales, Chistian, 600 bales, Jalalpur, 200 bales, Hasilpur, 2,000 bales, Jahania, 2,000 bales, Bahawalpur, 1,000 bales, Rajanpur, 200 bales, each Lahia, Tandiawali, Khanewal, and D.G.Khan at Rs2,400, 400 bales, Burewala and Mian Channu at Rs2,350 to Rs2,375, 400 bales, Haroonabad at Rs2,390 to Rs2,400 and 400 bales, Bahawalnagar at Rs2,350.
