KARACHI: Slow phutti (seed-cotton) arrivals continued to restrict cotton trading on Wednesday. Though there was a strong demand but short supply of new cotton crop disappointed spinners.
The ongoing spell of rain and high moisture content in phutti coming Sindh cotton fields also inhibited ginners from processing since the quality of lint is being badly affected.
The prospects of good cotton crop this season have brightened because rains have also entered Sindh province up to Sukkur region and greatly helped standing cotton crop.
Trading was highlighted by upward revision in spot rates of the Karachi Cotton Association (KCA). It seems that the KCA’s rate committee finally wants to narrow down the gap between official spot rate and that of ready counter trading.
As local cotton price remained firm but still much below the world rates, phutti prices also hovered around Rs3,700 to Rs4,000 for Sindh quality and for Punjab in the range of Rs3,500 to Rs4,000 per 40kg.
Meanwhile, India has raised minimum support price for cotton by up to 25 per cent ahead of expectation of higher cotton production this season. This move on part of Indian government will help protect growers’ interest.
Contrary to this, there is no minimum support price for cotton in Pakistan which mostly results in depriving growers from getting fair price for their produce. However, there is minimum support price for wheat, sugarcane and rice.
The world leading cotton markets shown mixed trend with China and India closing steady. However, New York cotton — which last week touched a peak level of 93 cents per lb — was close on account of Independence Day.
The Karachi Cotton Association (KCA) spot rates were revised upward by Rs100 to Rs7,900 per maund.
The following deals were reported to have changed hands on ready counter: 200 bales, station Sanghar, at Rs8,150; and 200 bales, Tando Adam, at Rs8,150.
Published in Dawn, July 5th, 2018