KARACHI: Cotton prices scrambled to an eight-year high level on Wednesday as short supply of phutti (seed cotton) failed to meet rising demand from spinners.

A big deal of 1,600 bales from station Tando Adam was finalised between Rs8,500-8,600 per maund and purchased by a leading spinner. The deal stands as the second highest cotton rate in the history of the country. According market sources, in 2010-11 cotton season domestic cotton prices surged to all time high level at Rs14,000 per maund, influenced by world market where prices rose up to US $2.29 per lb on strong demand for cotton from China.

Phutti prices also moved higher in sympathy and were quoted in the range of Rs3,800 to Rs4,150 for Sindh variety and Rs3,700 to Rs4,300 per 40 kg for Punjab quality.

Although trading activity has gradually started to pick up but the issue of demand and supply continues to impact cotton prices.

Meanwhile, frustrated ginners are holding meetings in order to set some rules among themselves to face the short supply of phutti which is badly affecting their ginning operations.

The world leading cotton markets — after witnessing surge in prices recently — are currently under correction. The New York, Chinese and Indian cotton markets closed easy.

The Karachi Cotton Association (KCA) also further raised official spot rates by Rs100 to Rs8,300 per maund.

Trading on ready counter was moderate as some spinners managed to get hold of deals of their choice. The following transactions were reported to have changed hands: 1,600 bales, station Tando Adam, at Rs8,500 to Rs8,600; 800 bales, Shahdadpur, at Rs8,500, 200 bales, Kotri, at Rs8,475; 200 bales, Vehari, at Rs8,475; and 400 bales, Burewala, at Rs8,450.

Published in Dawn, July 12th, 2018