KARACHI, Sept 22: Cotton market finished the weekend session on a firm note as official rate committee increased the official spot rates by Rs50 per maund amid brisk trading.
But in physical trading, some of the fine lots were sold Rs100 higher in the central Sindh cotton belt, which during the current season assumed the role of supplier of fine lint, floor brokers said.
Never before in Pakistan’s cotton trading history Sindh type was sold at premium as compared to its Punjab counterpart, which was known as medium staple length lint and was mostly sold at a premium over the local lint, they said.
“Spinners and the mills are the best judge of the quality of lint”, said a ginner adding “which type gives a better yield (after processing phutti into lint and cottonseed), fetches higher price”.
According to spinners Sindh yield is about 14 per cent as compared to Punjab’s 12.5 to 13 per cent and hence the price difference.
No one now doubts the size of the crop which is claimed to be well above the official estimate but what is important is that quality war has just begun and that could lead to further price hike, some ginners said.Another supporting factor leading to a tight market in future is said to be sharp increase in New York cotton futures, which has made imports more expensive.
Floor brokers and some leading spinners think the lint may be more expensive in the weeks to come in line with the developing situation on the world markets and the local market could hardly be an exception.“But how much the price flare-up could be is pretty difficult to speculate at this stage”, said a leading ginner “but thing is clear that prices has reacted from the early season peak of Rs3,450 to 2,750 followed by conflicting reports of damage to crop by rain and pest attack”. After several sessions, the official spot rates were revised upward by Rs50 per maund at Rs2,850 from previous Rs2,800 to match those at which business is being done.
New York cotton futures were quoted further higher by 1.28 and 1.21 cents per lb at 63.48 and 66.08 cents for both the ruling October and the forward December contracts, respectively.
Mill ready off-take was relatively slow owing to increase in prices and fell to about 10,000 bales as under:
SINDH TYPE: 1,000 bales, each Shahdadpur, Tando Adam, 200 bales each, Sarhari, Hala and Pithero, at Rs2,925, 200 bales, each Sanghar and Khipro at 2,900, 400 bales, Mirpurkhas at 2,900 to 2,910 and 400 bales, Nawabshah at 2,925 to 2,950.
PUNJAB VARIETY: 200 bales, each Rajanpur and Vehari at Rs.2,875, 600 bales, 400, 200, 200 bales, Hasilpur, Mian Channu, Gojra,and Sahiwal at 2,900, 600 bales, Chichawatani at 2,875 to 2,900, 800 bales, Pak Pattan at 2,870 to 2,890, and 800 bales, Bahawalpur at 2,875 to 2,900.