KARACHI, Sept 13: Cotton prices on Friday eased further as ginners indulged in fresh hasty selling followed by reports of larger arrivals of phutti into the ginneries and spot selling by the growers.
Floor brokers said there appears to be major change in the market perceptions of growers who unlike the previous sessions are not inclined to hold on to their stocks to keep prices at a competitive level.
Ginners followed them as no one among them is inclined to take risk of holding on to the unsold stocks of lint in a market, which appears to be unsettled, they added.
What seems to have sent bearish signals among the ginners are reports of steep decline in the New York cotton futures and its likely sympathetic impact on the local prices in the coming weeks, says a leading ginner.
New York cotton futures on Thursday fell by 1.48 and 1.52 cents per lb for both the ruling October and the distant December settlements at 41.73 and 43.49 cents per lb respectively, sending bearish signals in the global markets including the local one.
“Indications are that they are heading to breach the 40 cents per lb barrier owing to persistent speculative selling and if that happens during the next week, local prices could fall further”, dealers said.
They said spinners and mills are watching the swift changes on the world markets and have curtailed their daily offtake in the hope to covering positions at the lower levels.
The next couple of sessions could be very crucial for the future market direction as the prevailing panic about the price outlook could turn into a nervous selling.
Already some of the deals in the central Sindh lint were done as low as Rs1,925, which reflect ginners intentions not to hold long positions at least for the near-term.
The other disturbing factor was that Punjab lint was also sold at par with that of its Sindh counterpart, which in normal trading sessions is sold a premium of Rs50 to Rs75 per maund.
Owing to fall in the ready prices, official spot rates were also lowered by Rs10 at Rs1965 per maund.
Ready offtake was relatively slow as till late in the evening about 3,000 bales changed hands as under:
SINDH TYPE: 200 bales, Shahdadpur at Rs2,000, 200 bales at Rs1,975, 200 bales, Mirpurkhas at Rs1,960, 400 bales, at Rs1,950, 200 bales, Khipro at Rs1,925 and 200 bales, Tando Adam at Rs1,975.
PUNJAB VARIETY: 200 bales, Gojra at Rs1,950, 200 bales, Tandialawali at Rs1,975 and 200 bales, Bahawalnagar at Rs1,950.