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Cotton market steady

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KARACHI: Steady conditions prevailed on the cotton market on Friday where sustained buying from spinners and exporters kept trading volume very high.

However, phutti (seed cotton) prices rose on short supply. Phutti picking in Sindh has been stopped temporarily as the cotton picker women — mostly from the Hindu community — are celebrating a festival.

Due to slow off-take of yarn, cotton prices remained pegged at opening rates of the week though there was strong buying from millers and exporters.

Market sources said the deteriorating global economic conditions and falling value of currencies is affecting import and export trade severely. There are unofficial reports that a major import order 600 containers of yarn from China was cancelled. This has sent shock waves in the local textile industry.

The market is abuzz with talks that the government would soon throw a bombshell on masses by increasing gas tariffs up to 50 per cent because circular debt has already crossed over Rs1.3 trillion. This would trigger cost push inflation and also increase the cost of doing business which will make Pakistani products further uncompetitive in the world market.

Meanwhile, the government had been planning to give some relief to the masses by decreasing petrol prices by Rs2 per liter and diesel by Rs6 per liter but after a sudden increase in POL prices in the world market the chances for rate reduction have slimmed down.

The world leading cotton markets remained under pressure. The New York cotton market closed lower for second day while Chinese and India cotton were mixed to steady.

The Karachi Cotton Association (KCA) spot rates were firm at overnight level.

The following deals were reported to have changed hands on ready counter: 1,400 bales, station Shahdadpur, at Rs8,075-8,100; 2,000 bales, Tando Adam, at Rs8,075-8,100; 1,800 bales, Mirpurkhas, at Rs8,000-8,050; 1,000 bales, Hyderabad, at Rs8,050-8,100; 1,000 bales, Hala, at Rs8,050-8,100; 2,600 bales, Nawabshah, at Rs8,075-8,100; 400 bales, Ahmedpur East, at Rs8,300; 200 bales, Khanewal, at Rs8,300; 200 bales, Mian Channu, at Rs8,300; 600 bales, Burewala, at Rs8,235-8,250; and 400 bales, Chichawatni, at Rs8,200-8,300.

Published in Dawn, September 1st, 2018