KARACHI, Aug 15: Cotton market on Thursday showed a relatively quieter trend as both the ginners and the spinners were a bit cautious for making fresh commitments owing to conflicting reports about the arrivals of phutti into the ginneries.
The slow business in part was also attributed to the recent TCP tender for local sales as spinners were awaiting the details of successful bidders and the lots they managed to buy at the TCP benchmark price or above it.
The prices on the local market are currently being guided by the rates at which the TCP managed to clinch most of the deals. But the last week’s price flare-up was largely attributed to reports of pest attack in some of the areas of the Punjab cotton belt and reported damage to standing crop.
However, official sources later denied any major damage, which could have negative impact on the total crop estimates. As a result, further speculative rise in prices was checked on last Tuesday.
Stray lots did change hands, mostly from the lower Sindh ginneries around Rs2,250 or slightly below this level depending on the quality of the lint in trade but spinners were a bit reluctant to make fresh commitments.
Unlike the last couple of sessions when spinners chased new crop lint price as high as Rs2,350 per maund, leading among them remained conspicuous by their absence, dealers said.
They said spinners’ main attention was focused on the outcome of Tuesday’s local sales by the TCP as most of them have bid for substantial lots claimed to be of fine quality.
Meanwhile, reports coming from the lower Sindh and central Punjab ginneries indicate that growers have accelerated the pace of arrivals of phutti into the ginneries after a modest fall in prices.
According to local brokers prices of phutti have, during the last two days, declined to Rs1,000 per 40 kg, from the peak level of Rs1,050 in the Punjab and Rs1,025 in the Sindh cotton belt, which in turn have halted the market’s upward drive.
The official spot rates did not show any change, although some of the deals were finalized above them, notably for the Sindh lint.
New York cotton futures on the other hand rose further by 0.50 and 0.60 cents per lb at 45.48 and 47.02 cents for both the ruling October and the distant December settlements.
Ready business was light as till late in the evening about 1,000 bales both from the Sindh and the Punjab ginneries changed hands mostly above the official spot rates.