MULTAN: Cotton prices plunged by Rs700 per maund on Monday mainly due to rupee-dollar exchange rate volatility forcing exporters to stay out of the trading ring, market sources said.

“The export of cotton yarn has declined drastically up to 65 per cent during the last one week,” said Syed Mudabbir Shah, a Multan-based cotton expert.

Phutti (seed-cotton) prices also declined from Rs4,600 to Rs4,100 per 40kg.

“We never witnessed such a rapid decline in cotton prices and such a sharp increase in the rates of polyester fibre,” he said. Polyester fibre price has risen to Rs185.

Last week’s report of United States Department of Agriculture regarding the estimated production of cotton in the world also put negative impact on the prices according to which the production is more than the estimated consumption, he summed up.

As many as 17,000 bales changed hands on Monday, out of which 8,000 bales were from Punjab and 9,000 bales from Sindh.

The Karachi Cotton Association also reduced its spot rate by Rs200 to Rs8,700 per maund. Follow­ing deals were reported to have changed hands on the ready counter: 200 bales, Tandlianwala, at Rs8,500; 200 bales, Haroonabad, at Rs8,500; 200 bales, Khadro, at Rs8,350; 200 bales, Shahpur Chakar, at Rs8,350; 600 bales, Chichawatni, at Rs8,350; 400 bales, Vehari, at Rs8,400; and 400 bales, Jhang, at Rs8,300.

Published in Dawn, August 14th, 2018