KARACHI: Cotton prices rebounded on sudden revival of buying from leading spinners who chased quality lots in order to replenish their inventories.
A host of factors induced buying sentiment including reports that the Plant Protection Department (PPD) — despite collecting applications from spinners — has so far not issued ‘no objection certificate’ or withdrawn the notification banning cotton imports from India.
However, the main reason behind the buying spree were reports which suggest that cotton crop in India’s Maharashtra, a major cotton growing state, has suffered up to 50 per cent damage due to pest attack.
The crop loss is so huge that official estimates have pegged it at a whooping Rs150 billion. This has totally changed the spectrum of cotton crop in the region for both India and Pakistan.
As a result, Pakistani spinners are panicking and rushing to get hold of any lots which suit their quality standard. This buying rush has once again pushed cotton prices close to a seasonal high level of Rs7,000 per maund.
Buyers chased big lot deals and did not consider rising prices that may disturb their world parity in yarn.
A sudden turn in situation after Indian crop’s report of huge damage has disturbed the entire cotton economy.
The world leading cotton markets, however, came under correction with New York cotton closing all around easy on profit selling. However, Indian cotton moved higher after reports of crop damage in Maharashtra state.
The Karachi Cotton Association (KCA) spot rates were firm at overnight level.
The following deals were reported to have changed hands on ready counter: 1,000 bales, Mirpur Mathelo, at Rs7,000; 1,600 bales, Khanpur Maher, at Rs7,000; 1,200 bales, Ghotki, at Rs7,000; 3,400 bales, Daharki, at Rs6,900 to Rs7,000; 2000 bales, Khairpur, at Rs6,400 to Rs6,550; 1,200 bales, Shahdadpur, at Rs6,250; 800 bales, Sadiqabad, at Rs7,000; 1,200 bales, Rahimyar Khan, at Rs7,000; 1,400 bales, Shujabad, at Rs6,800 to Rs6,900; 1,400 bales, Mianwali, at Rs6,400; 1,400 bales, Chishtian, at Rs6,300 to Rs6,350; and 1,000 bales, Haroonabad, at Rs6,300 to Rs6,350.
Published in Dawn, December 7th, 2017
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