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KARACHI, Nov 8: Trading activity on the cotton market on Thursday was maintained on the higher as spinners and mills continued to make panic covering purchases to grab the floating stock, analysts said.
And in the process, prices were quoted further higher by Rs25 per maund at Rs3,325 per maund and analysts said it is pretty difficult to predict at this stage where the end will come.
Later in the evening some deals in the southern Punjab variety were done at Rs3,350 per maund, while some ginners were still seeking further rise in prices, dealers said.
“The price war among the leading textile groups is assuming alarming proportions each session,” said a broker, adding “their weaker links are at a disadvantage and thinking to shut their business at least for the near-term. But I don’t think prices will ease from the current higher levels as each one is trying to outwit each other without having an idea where to sell the expensive end-products,” he added.
“It is not clear at this stage who is the chief beneficiary of the current price flare-up,” said another cotton analyst “some say it is the grower, while other claim it is the ginner”.
He said spinners and mills appeared to be at the receiving end complained about larger unsold stocks of cotton yarn and textiles to which huge amounts were tied and were awaiting the pick up in world demand and competitive rates.
But one thing appears certain that export parity levels are badly disrupted by the current local price flare-up as there is no increase in rates of world textiles, he added.
Official spot rates were quoted further higher by Rs25 per maund at Rs3,175 per maund but in physical trading there were buyers at Rs3,325.
New York cotton futures on the other hand showed fractional decline of 0.10 and 0.06 cents per lb at 65.07 and 69.56 cents for both the ruling December and the forward March contracts respectively.
About 40,000 bales, changed hands in the ready section, the following being some of the notable deals:
SINDH VARIETY: 600 bales, each Shahdadpur, Dadu and Shahpur Chakar at Rs3,200.
PUNJAB TYPE: 1,000 bales, Head Bakairi Ghazi, 800 bales, each Ghat Dera Ghazi and Khan Queshi Mor and 200 bales, Chistian at Rs3,325, 2,000 bales, each Bahawalpur and Rahimyar Khan at Rs3,300, 1,000 bales, each Khanewal and Lodhran, Fazalpur, Liaquatpur, Ahmedpur East and 1,400 bales, Rajanpur, 600 bales, Chingoth, 800 bales, Jampur, 400 bales, Sardar Lund, Mubarakpur, Haroonabad, Burewala, Kossowal and 200 bales, each, Fort Abbas, Bahawalnagar and Hasilpur at Rs3,300.
The following are Thursday’s new crop Karachi Cotton Association (KCA) official spot rates for local dealings in Pak rupees for base grade 3 staple length 1-1/32” micronair value between 3.8 to 4.9 NCL.
Rate for Ex-Gin Price Up-country Spot rate
Expenses Ex-Karachi
37.324 kgs 3,175 50 3,225.00
Equivalent
40 kgs 3,403 50 3,453.00
