KARACHI: The cotton market remained devoid of trading activity as buyers and sellers remained to the sidelines on Monday.
The year closing session was highly depressing with little hope of buoyancy in coming days.
In the absence of trading interest, the phutti (seed-cotton) prices also moved lower between Rs100-200 per 40kg.
Sindh phutti was being quoted between Rs3,000-3,800; Punjab remained in the range of Rs3,000-3,900 and Balochistan variety between Rs3,200-3,800 per 40kg.
A large scale closure of shuttle looms in Faisalabad is having a devastating impact on the entire cotton economy, the brokers said.
Reports have suggested that loom owners have started to sell their machines in scrap because they had been sustaining losses for the last 2-3 years.
This is resulting in building up of huge unsold cotton yarn stocks with spinners and cotton stocks with ginners.
Meanwhile, value-added textile industry, mostly engaged in exports, has urged the government to immediately release their outstanding funds against different schemes including Duty Drawback of taxes, Drawback on Local Taxes and Levies (DLTL) etc.
Leaders of value-added textile sector in a meeting held on Monday sought Prime Minister Imran Khan’s intervention and stated that if these long outstanding payments were not made, exporters would fail to fulfill export commitments.
In short, the entire textile industry is facing liquidity crunch and shortage of utilities including gas, power and water, brokers maintained.
The Karachi Cotton Association spot rates were unchanged at Rs8,800 per maund and trading on ready counter was hardly evident as no transactions were officially reported to have transpired.
Published in Dawn, January 1st, 2019