KARACHI, Aug 27: Cotton prices on Wednesday eased from the previous highs as the lower Sindh ginners indulged in hasty selling followed by reports of steady arrivals of phutti into the ginneries.
Trading in the ready section resumed around Rs2,525 as compared to previous average rate of Rs2,550 and as the selling pressure further intensified prices fell to day’s lowest level of Rs2,500.
Some of the fine lots, however, managed to fetch higher rate of Rs2,560 to Rs2,575 per maund depending on quality of lint including micronaire, dealers said.
Prices of Punjab lint also eased sharply from the previous level as some of the deals were finalized at Rs2,525 as compared to Rs2,650 during the last couple of sessions.
“Spinners and mills were conspicuous by the absence hoping further decline in prices, which in turn accelerated the pace of selling by the ginners”, they said.
They said the snap reversal of the market from the recent highs to the lower level surprised leading brokers who claimed the “panic among the ginners seem to have caused by steady arrivals of phutti from the fields”.
It is presumed that the picking operations were not suspended owing to the recent rain as widely speculated here but they were accelerated to pick phutti well in time.
Floor brokers said official reports of higher crop estimate owing to increase in the sown acreage appears to be the ginners worry most of whom are not inclined to hold long positions and sold in a bit haste.
“It is not the question of holding capacity but perceptions of further fall in prices, which caused the reversal”, says a leading ginner and predicted further decline as the arrivals further improve.
The other negative factor was reports that picking operations in the central Punjab ginneries has picked up in the recent past as growers are out to get the maximum price of Rs1,100 per 40 kg for their phutti, he adds.
There was no change in the official spot rates for the third session in a row, although most of the deals finalized in the ready section were well below this rate.
Ready offtake was modest totalling 2,500 bales as under:
SINDH TYPE: 400 bales, Sultanabad at Rs2,525, 200 bales, at Rs2,515, 400 bales, Shahdadpur at Rs2,575, 100 bales, at Rs2,560, 100 bales, Mirpurkhas at Rs2,500 and 200 bales at Rs2,510.
PUNJAB VARIETY: 1,200 bales, Samundari at Rs2,650 and 200 bales, Tandliawali at Rs2,525.