KARACHI: Cotton prices came under pressure on Wednesday as buyers withdrew to the sidelines in front of highly volatile currency market. However, some buying was witnessed at the lower level from exporters.

Floor brokers said the rapid appreciation in the rupee’s value disturbed the entire trade and exports of the country as new price lines have started to emerge.

Not only the payments against export proceeds have come down after the local currency’s revaluation, the prices of raw materials held in inventory have also declined resulting in huge losses to the industry.

Cotton analyst Naseem Usman said cotton prices, which crossed Rs7,000 per maund during the season, have now come down to Rs5,900 to 6,400 per maund. He added that almost entire current season crop has been sold and only 0.5 million bales are lying with ginners.

This indicates that spinning industry is presently holding huge stocks of cotton to see the current season through for the remaining two to three months. This means that spinners on an average have purchased cotton at around Rs6,500 to Rs7,000 per maund, he added.

The world cotton markets also showed easy trend where New York cotton closed lower for all the future contracts.

The Karachi Cotton Association (KCA) reduced its spot rates by Rs100 to Rs6,400 per maund and trading on ready counter was slow.

The following transactions were reported to have changed hands on ready counter: 2,000 bales, Ranipur, at Rs5,900; 200 bales, Multan, at Rs6,100; 400 bales, Yazman Mandi, at Rs6,400; 400 bales, Bahawalpur, at Rs6,400; and 200 bales, Shadan Lund, at Rs6,400.