KARACHI, Jan 21: Cotton prices on Wednesday maintained their upward drive on panic mill buying amid fears that fine lots may hardly be found after the Trading Corporation of Pakistan floated a tender for 0.1m bales.
An idea of panic mill buying may well be had from the fact that well over 60,000 bales, largest tally in the current season in a single session, changed hands on Wednesday, floor brokers said.
Some of the deals were finalised as higher as Rs3,450 per muand, indicating that the market could heat up further in the coming sessions as ginners will opt for TCP tender.
After having purchased more than half million bales, spinners said the TCP should not have floated the fresh tender as it added to the current price flare-up in the backdrop of short crop.
As a second buyer its role is to ensure a fair price to the grower if the crop is surplus more than the local demand of the industry, they said, adding “the mid-season tender could create more problems for the already haunted industry on more than one counts.”
“There is a virtual run on the lint, both medium and fine lots, as the latest arrival figures of phutti into ginneries have showed that the crop could be around 10.5m bales despite revised targets,” they added.
Although the situation on the export front is still unclear, spinners and mills are not inclined to take even a calculated risk on the future supplies of lint, some others said.
Whether or not spinners and mills will opt for foreign lint to make up the local crop shortfall in the backdrop of fresh limit-fall in New York cotton futures at the lower rates, will be clear during the next couple of sessions, they said.
New York cotton futures on Tuesday suffered a sharp fall of 2.19 and 2.33 cents at 46.81 and 47.25, respectively, for both the ruling March and the forward May settlements, respectively.
There was, however, no change in the official spot rates for the third session, which were quoted at Rs3,300 per maund.
The following are some of the notable deals reported by the brokers:
SINDH TYPE: 1,600 bales, upper Sindh at Rs3,400, 1,600 bales, Bhiria at Rs3,150, 2,000 bales, Shahdadpur at Rs3,200 and 1,600 bales, Khipro at Rs3,175.
PUNJAB TYPE; 3,000 bales, Rajanpur at Rs3,450, 2,400 bales, Mohammadpur at Rs3,400 to Rs3,450, 7,400 bales, Ghazi Ghat at Rs3,300 to Rs3,450, 4,600 bales, Khanpur at Rs3,300 to Rs3,400, 1,000 bales, Alipur , 1,600 bales, each Mian Channu and Fazilpur at Rs3,400, 4,835 bales, Ahmedpur East at Rs3,300 to Rs3,300, 8,000 bales, Noorpur at Rs3,275 to Rs3,300, 1,000 bales, Choti at Rs3,300, 1,000 bales, Yazman at Rs3,275 and 1,400 bales, Faqirwali at Rs3,225.