KARACHI: Trading on the cotton market remained slow and restricted on Tuesday due to poor demand for lint from leading spinners. Barring a few small and needy spinners, the trading ring gave a deserted look.
Sluggish off-take of yarn locally and falling world cotton prices continued to depress lint rates. Leading spinners already having long positions were conspicuous by their absence.
According to market sources, big spinners are currently holding around five million cotton bales. These spinners are facing a liquidity crunch because slow off-take of cotton yarn is challenging their cash flow, sources added.
Similarly, ginners are also holding around 0.8-0.9m bales while a small quantity of phutti (seed cotton) of around 1.5m bales are left behind in the fields.
Meanwhile, the Cotton Association of India (CAI) has claimed that the country would be producing around 0.8m bales less this season, with a total estimated output at around 375m bales.
India had opening stocks of near 3m bales. However, private estimates placed Indian cotton production even lesser at 366m bales because pink bollworm attack in Maharashtra and other cotton growing states extensively damaged cotton crop. After meeting domestic demand of around 320m bales will be left with small quantity of exportable surplus of around 5.5m bales.
The Karachi Cotton Association (KCA) spot rates were firm at overnight level of Rs7,000 per maund.
The following deals were reported to have changed hands on ready counter: 1,400 bales, Khanpur, at Rs7,000 to Rs7,200; 400 bales, Ferozah, at Rs7,200; 400 bales, Lodhran, at Rs6,800; 1,400 bales, Haroonabad, at Rs6,185-6,400; 200 bales, Chishtian, at Rs6,200; 400 bales, Yazman, at Rs6,200; and 400 bales, Fort Abbas, at Rs6,200.
Published in Dawn, February 14th, 2018