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Another quiet day in cotton market
KARACHI: (April 03 2004) The cotton market had
another quiet day on Friday, which is usually an
off day for upcountry ginneries.
Business interest was conspicuous by its absence.
Persistent decline in New York cotton futures and
the pending release of final crop report kept the
spinners glued to the sidelines.
A leading analyst said that tumbling prices on New
York market and lower yarn rates in the domestic
market are the main reasons for the depressed
outlook of the cotton market.
Cotton prices have crumbled by no less than Rs50
per maund this week under the weight of declining
yarn prices in the home market and persistent fall
in New York cotton futures.
The spinners are keeping away from the market
scrupulously avoiding taking of fresh positions.
The bearish outlook of the New York futures market
is attributed to higher planting intentions for
2004-05 US cotton crop raising the area under
cultivation to 14.4 million acres signifying an
increase of 7 per cent over last year.
This has resulted in limit down recorded in prices
of the frontal months on the New York Cotton
Futures Market on last Wednesday.
On April 1, the May and July settlements were down
by 0.57 and 0.55 cent at 61.53 cents and 63.35
cents, respectively. The situation is quite
worrisome for the local ginners who are now
inclined to dispose of accumulated stocks even at
reduced prices.
Spinners too have deferred further purchases
weighing prose and cons of importing cheaper
foreign cotton instead of going for expensive
domestic cotton.
They are also worried over the steep decline in
local yarn prices and may not like to add to their
burden unless the yarn outlook improves.
On Friday, official spot rate remained unchanged
at Rs2,925. Ready business stood at 100 bales of
Nawabshah sold at Rs2,725.
The News |
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Pakissan.com; Advisory Point
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