KARACHI, Sept 11: Cotton market on Wednesday maintained its upward drive as spinners were not inclined to take even a technical breather amid fears of further increase in prices.
Physical business remained fairly steady for the third session in a row as both buyers and sellers fully participated in the day’s proceedings, notably ginners without holding back stocks in a bid to push prices further higher.
The market is responding positively to the changed situation on the world cotton front including firm posture of the New York cotton futures and indications are that spinners may be able to keep a judicious balance between the export and the local prices in the coming weeks also.
But some others said that the future direction of the market will largely depend on the size of the cotton crop and if there are reports of major damage in the Punjab cotton belt then the current status quo in supply and demand may not be sustained, dealers said.
Floor brokers said the sudden pick up in mill demand is attributed to steady inflow of import orders for cotton yarn from the foreign buyers after a relative dull for the last couple of weeks.
“Reports of short crop in China owing to damage caused by floods was cited as one of the reasons behind the firm market and rising prices”, they added “some positive local factors including large export orders being received by the spinners and mills also aided the sentiment”.
Official spot rates were raised further higher by Rs10 to Rs1,975 per maund excluding 15 per cent sales tax.
But in physical trading, a couple of big-lots changed hands at Rs2,025 per maund, reflecting steady increase in prices for the last three sessions. The net rise over the previous rate is said to be Rs25 to Rs50 per maund.
New York cotton futures showed mixed trend amid narrow price movements. While the ruling October delivery ended further fractionally higher by 0.4 cents at 43.43 cents per lb, the distant December fell by 0.3 cents at 45.21 cents per lb.
Ready offtake was on the higher side as till late in the evening about 6,000 bales changed hands mostly from the Sindh ginneries, the following being some of the notable deals: 1,500 bales, Tando Adam at Rs2,025, 800 bales, at Rs2,000, 1,400 bales, Shahdadpur at Rs2,025 and 200 bales, Mirpurkhas at Rs1,950.