KARACHI: Fears of more rain and floods triggered some panic buying from spinner on the cotton market Thursday. The underlying sentiment remained firm and steady and outlook uncertain.

Reports of phutti (seed cotton) reaching ginneries have higher moisture content is feared to affect cotton quality which would also create problems for spinners.

Consequently, some renewed buying from millers helped prices move higher and activity also picked on strong buying from spinners. However, declining phutti prices are feared to hurt growers’ interest.

Cotton analysts believe that falling phutti prices — Rs1,700 to Rs2,200 per 40kg — are already below the threshold and it is feared that growers will have to use pesticide after rains to save their cash crop which will further add to their cost.

Meanwhile, the Trading Corporation of Pakistan (TCP) has accepted the offer of 6,800 bales offered by a spinning mill at Rs4,900 a maund.

The Karachi Cotton Association (KCA) raised its spot rates by Rs50, to Rs4,700 a maund.

The following major deals were reported on ready counter: 400 bales from Hyderabad done at Rs4700, 400 bales Sanghar at Rs4700, 400 bales Shahdadpur at Rs4700, 400 bales Tando Adam at Rs4700, 400 bales Kotri at Rs4700, 400 bales Sumandary at Rs4875, 400 bales Bahawalnagar at Rs4900, 200 bales Ranala Khurd at Rs4900, 200 bales Burewala at Rs4900, 200 bales Arifwala at Rs4900 and 400 bales Haroonabad at Rs5000.

On the New York cotton market all the future contracts closed with modest losses.

Published in Dawn, July 31st, 2015

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